Introduction

In the rapidly evolving landscape of global trade, Bangladesh has made noteworthy strides in transitioning towards digital trade transactions. The imperative for a preparatory process to engage in digital trade operations for importing and exporting goods is evident, fueled by the accelerated growth rate in digital trade compared to traditional methods. Projections for Bangladesh's digital commerce market anticipate a remarkable rise to $11 10 billion by 2023. Meanwhile, on a global scale, e-commerce constitutes 22% of retail sales and is poised to reach a staggering $5.4 trillion by 2026, underlining the escalating significance of digital trade. The worldwide trade volume in 2022 stood at USD 22 trillion.(Statistia, 2023)

The importance of digital trade is growing, comprising two key components: digitally accelerated trade in goods and services, commonly known as cross-border electronic commerce (e-commerce), and digitalize trade operation, which entails the global provision of services by using the web or other networks. However, there exists considerable disparity among nations about their level of readiness to participate in digital trade. In order to achieve the goal of increasing the contribution of developing nations, especially the least developed countries, in global trade as outlined in the 2030 Agenda for Sustainable Development, it is imperative to implement measures that enhance their ability to capitalize on digital trade. The urgency of this need has been further heightened by the global COVID-19 outbreak.

Although there is currently no universally acknowledged and agreed-upon definition of digital trade, there is an increasing consensus that it covers transactions facilitated by digital technology. These transactions involve the exchange of products and services, which can be given in either digital or physical formats. Recognizing that not all digital trade entails digital delivery is crucial, as it spans activities like online book purchases or accommodation reservations through matching programs, where physical delivery remains essential.

The fundamental basis of digital trade lies on the exchange and transmission of data. Data functions as a means of production and a valuable resource that may be commodified and leveraged for the delivery of services. Furthermore, it indirectly promotes physical commerce by enabling the implementation of trade facilitation initiatives. Data plays a pivotal role in the implementation of developing service supply models, including cloud computing, the Internet of Things (IOT), and additive manufacturing.

The transformative impact of digitalization extends beyond commerce, enhancing the magnitude, range, and velocity of commercial transactions. This technological progression enables companies, particularly smaller enterprises, to leverage cutting-edge digital technologies, overcoming barriers to expansion by utilizing cloud-based services and exploring alternative funding avenues like crowdfunding.

However, the transformative impact of digitalization introduces new challenges, especially in the realm of international trade and investment policies. Emerging technologies and innovative business models are revolutionizing the production and provision of services, blurring boundaries between commodities and services as well as means of delivery. The inefficiencies associated with border procedures now extend to affect parcel trade, and limitations on newly tradable services are becoming apparent.

This study aims to delve into these transformations, enhancing understanding of the characteristics and magnitude of emerging challenges. Through this comprehensive research seeks to contribute insights that will aid policymakers in establishing an environment conducive to innovation and facilitating the seamless exchange of digital products and services. The unparalleled speed at which these changes are occurring underscores the imperative for trade operations to exhibit enhanced speed and reliability, meeting the increasing interconnection and heightened need for timely delivery. Additionally, this study will contribute to the ongoing discourse on the necessity of revising or elucidating existing trade regulations and obligations, recognizing the evolving nature of business practices in the digital era.

Background of the study

This research has been documented for those with a comprehensive understanding of the international trade mechanism. To execute digital trade in Bangladesh, it is important to support aspects such as policies, logistics, infrastructure, knowledge, and end-user acceptance. It would also help to be aware of how local and global regulations pertaining to digital trade are used. Understanding the present global trade trends will be particularly helpful for those who apply these regulations. In our perspective, this will undeniably assist policymakers in aligning their actions with the prevailing trend. Currently, government has taken this type of initiative to transform trade into digital form.  The UN Economic and Social Commission for Asia and the Pacific (ESCAP) recently released an overview and solutions for Bangladesh's adoption of digital trade.

This article is being produced during a period in which trade is predominantly conducted through paper-based, traditional, and manual processes, which are currently undergoing a transition towards digitalization. Apart from this, despite a high standard of living and a high level of trust among business partners, the risks and difficulties associated with local or international transactions are made all the more difficult by the absence of banking laws, foreign exchange regulations, or policies, which are primarily problems in developing nations.

The digital trade transition has, nevertheless, been effectively implemented in many affluent countries. Buyers, sellers, and stakeholders all look for the safest, quickest, and fastest methods of payment for their global trade operations. The utilization of conventional letters of credit (LC) has emerged as an intermediary option for the practice of ‘payment undertaking’ and the more lenient approach. However, a study highlights the components required for Bangladesh to achieve the digital trade revolution given that the traditional letters of credit shifting into digital form and paper based trade are no longer very successful.

Methodology

Focus is placed mostly on import and export from Bangladesh also trigger with digital transactions. The methodology employed in this study primarily relies on both secondary and primary data sources.

The primary data was obtained through a survey conducted among trade finance practitioner, banking professionals from Private Commercial Banks (PCBs), Foreign Commercial Banks (FCBs), and Nationalized Commercial Banks (NCBs) in the Dhaka and Chittagong regions. The participants seemed primarily in-charges of trade finance desks, heads of FI units in international divisions, and few policymakers from Central Bank, National Board of Revenue (NBR), Ministry of Finance, and a small number of legal advisors and businessmen, academician and journalists. Encouragement also received from some of the top exporters and importers in the nation who took part in this inquiry. Interview over the phone or in person with business bodies were also conducted with a set of standardized questionnaire. 

Secondary data are gathered from public sources such as, the International Chamber of Commerce (ICC) Global Trade & Finance Survey, published data from Asian Development Bank (ADB), World Bank, the Balance of Payment and Export Import Position from Bangladesh Bank, and other secondary data. A survey questionnaire consists of 17 questions also formulated to gather relevant information and a descriptive research study also conducted from those collected information.

Literature Review

Worldwide digital trade- current status, laws, rules and regulation

The advent of digital transformation has resulted in a decrease in the expenses associated with participating in transnational trade, streamlined the integration of worldwide value chains, facilitated the dissemination of ideas and technology, and fostered more connectivity among a larger population of enterprises and consumers on a worldwide scale. However, despite the increased ease of participating in global trade, the implementation of novel business models has led to the emergence of intricate international trade transactions and policy concerns.

In the contemporary global landscape characterized by rapidity and interconnectivity, governments are confronted with novel regulatory obstacles. These problems extend beyond the management of digital disruption and encompass the imperative of facilitating the realization and equitable distribution of opportunities and advantages stemming from digital trade.

Forms of digital trade operations

The meaning of digital trade in the year 2020 was established by three transnational organizations, encompassing all forms of trade which involve digital ordering and/or digital delivery. According to the provided definition, digitally delivered trade refers to the process of conducting international transactions remotely through electronic means, utilizing computer networks. On the other hand, digitally placed trade pertains to the worldwide buying or selling of a product or service, simplified through computer networks by employing techniques specially developed for the drive of placing or receiving orders.(International Monetary Fund & United Nations Conference on Trade and Development and World Trade Organization, 2023)

Digitally delivered trade

The utilization of online platforms for purchasing and selling goods and services has witnessed a significant rise among individuals and enterprises. Moreover, there has been a notable shift towards the digitalization of global value chains. The ability to engage in digital trade has become a crucial requirement for enterprises operating in developing countries. The global health crisis has further emphasized the significance of digital technologies in facilitating international trade.

In the year 2020, there was a notable decline of 20 percent in global services exports when compared to the previous year, 2019. However, the exports of digitally deliverable services, which refer to services that can be remotely delivered through Information and Communications Technology (ICT) networks like the Internet, demonstrated a relatively resilient performance. These exports experienced a decline of only 1.8 percent, despite the significant economic disruption caused by the pandemic.(UNCTAD, 2021a) The user's text is too short to be rewritten academically. Consequently, the proportion of worldwide services exports accounted for by digitally delivered services was over 64% (refer to figure 1).

Services delivered digitally, by country and region of export [Figure 1]

Figure 1: Services delivered digitally, by country and region of export Click here to view Figure

The previously described developments have accelerated a current trend, namely the increasing importance of digitally delivered services within the services commerce domain. There was a discernible rise in the export of digitally transportable services worldwide between 2005 and 2019. The nominal growth rate of these exports was 12 percent on average annually, with growth rates as high as 21 percent in Asia. Within the total global services exports, the share of digitally delivered services increased from 45 percent in 2005 to 52 percent in 2019.

The category of "other business services" constitutes the most significant component of digitally deliverable services, encompassing a wide range of diverse offerings. It is closely followed by the category of "telecommunications, computer, and information services". The categorization of service categories has been recognized as digitally deliverable, often known as "potentially ICT-enabled."(Tn_unctad_ict4d03_en.Pdf, n.d.)

However, there is a lack of regular distinction between the proportions of services that are actually offered digitally. The United Nations Conference on Trade and Development (UNCTAD) is collaborating with several nations to assess this phenomenon by means of surveys. Preliminary findings derived from studies conducted in Costa Rica, India, and Thailand indicate that a significant proportion, ranging from 80 to 99 percent, of services that have the potential to be offered through information and communication technology (ICT) networks are indeed being delivered using this mode of delivery. The user's text is too short to be rewritten in an academic manner.(Tn_unctad_ict4d11_en.Pdf, n.d.)

Digitally Ordered Trade

Digitally ordered trade can be considered as a subcategory within the broader domain of electronic commerce. In the year 2020, a significant proportion of enterprises, namely 24%, reported receiving orders using online channels, while a somewhat higher percentage of firms, exceeding 40%, indicated that they made orders using online platforms (Presspb2021d10_en.Pdf, n.d.)The level of adoption differs according on the size of the organization, with large firms exhibiting a significantly higher proportion of online sales compared to small firms, on average (OECD, 2019). The number. Customers-wise, throughout 2019 almost 1.5 billion people, or 27% of the global population over the age of 15, participated in online buying action (UNCTAD, 2021b).

In 2020, there was a 5.2 percentage point increase in the proportion of individuals engaging in online shopping among the 27 member nations of the Organization for Economic Co-operation and Development (OECD) for which data is accessible (OCED. Stat, 2023). This marked the most substantial surge observed since the commencement of data collection in 2005. The global economic value of total e-commerce, encompassing both domestic and foreign transactions, is expected to have reached $26.7 trillion in 2019 (Tn_unctad_ict4d18_en.Pdf, n.d.). The accessibility of accurate statistical data regarding the proportion of cross-border e-commerce is restricted. It is believed that cross-border business-to-consumer transactions were approximately $440 billion out of the overall business-to-consumer e-commerce sales, which amounted to $4.9 trillion. In the year 2020, over 25% of those who engaged in internet shopping participated in cross-border transactions. Nevertheless, it is worth noting that a significant majority (82%) of e-commerce transactions are attributed to business-to-business interactions. However, the precise proportion of these transactions that are international in nature, and so contribute to the realm of digital trade, remains undetermined at present.

There exists a necessity to establish consensus regarding the methodologies employed in quantifying cross-border e-commerce, as well as to expand the scope of countries engaged in generating statistical data in this domain. Simultaneously, there is a need for additional development and wider compilation of statistics pertaining to digitally provided services trade, distinct from digitally deliverable services. This is essential in order to obtain comprehensive and reliable data on digital commerce, which can then be utilized to inform legislation based on facts.

Growth in digital trade is largely unequal

The proportion of exports attributed to digitally deliverable services remains significantly lower in the least developed countries, as well as in Africa, Latin America, and the Caribbean, compared to other global areas. In a comparable vein, it is noteworthy that whereas more than half of the population residing in high-income countries engaged in online shopping activities during the year 2019, this proportion was merely 2 percent in low-income countries. Countries with lower levels of digitalization face a disadvantage when it comes to utilizing electronic commerce. Moreover, their limited capacity to leverage the resilience of digitally transmitted services trade in response to unforeseen events like the pandemic renders them more susceptible to significant declines in export revenues and hindered economic progress. In a broader context, the growing significance of digital ordering and digital delivery has emerged as a critical factor in accessing markets across many regions globally. Consequently, persons who lack the capacity to engage in digital trade face the potential consequence of experiencing greater economic disadvantage.

Enhancing the capabilities of developing nations to leverage digital trade opportunities

Many developing nations must increase their capacities to participate in and profit from digital trade. The challenge for policymakers is to deal with the high level of uncertainty, general data scarcity, and quick rate of technological change. The formulation and implementation of pertinent policies, as well as international development aid, must be done in a comprehensive and coordinated manner across governments and with other stakeholders in order to ensure more equitable outcomes from digital trade.

Digital Trade Transactions

As global dynamics and advancements in digital technology continue to evolve, the trading community also undergoes transformation and adaptation. Currently, we find ourselves at the nascent phase of the digital trade transaction trajectory, wherein our primary focus lies on establishing the foundational elements that will support this transformative process and lay the groundwork for future advancements. In this context, it is appropriate to commence by establishing a precise definition for the term 'digital trade transaction'. The definition of a digital commercial transaction lacks widespread acceptance. The commerce industry has a significant obstacle wherein a considerable proportion of commodities are manufactured in foreign countries and subsequently transported to purchasers, rendering complete digitization of all transactions unfeasible. The potential utilization of technology, such as 3D printing, has been proposed as a means for consumers to produce goods within their local vicinity. However, it is important to note that this concept has not yet been fully realized.

Four billion documents are currently in circulation within the trade systems

In addition, it is worth noting that commercial transactions are commonly accompanied by a substantial volume of physical documentation. To be more precise, the International Chamber of Commerce (ICC) reports that approximately 4 billion documents are currently in circulation within the trade system. The aforementioned documents encompass essential details pertaining to the transaction in question, while also serving the purpose of documenting the rights and responsibilities of the parties concerned. The advancement of technological innovations aimed at digitizing, connecting, and automating trade processes presents novel opportunities to bring commerce closer to the envisioned state of being "digital at source." The integration of many technologies to establish an ecosystem enables the emergence of novel channels that enable the efficient transmission of data, which was previously limited to in-person interactions. Prominent illustrations encompass the process of digitizing title documents, which presently can be generated as a secure digital document or a mere electronic record stored on a shared database or ledger. Open application programming interfaces (APIs), cloud computing, distributed ledger technology, and various other technological advancements contribute to enhancing data openness and facilitating data accessibility.

However, a consistent regulatory framework is still absent in the digital trading environment. Certain stakeholders within the industry have already formulated their own sets of guidelines, while the industry as a collective endeavor to align with these standards.

Uniform Rules for Digital Trade Transactions: a new rules come into forced

The ICC Uniform Rules for Digital Trade Transactions (URDTT) [diagram:1] have been designed with the following objectives: (a) to cater to a completely digital setting; (b) to maintain impartiality towards technology and messaging standards; and (c) to encompass the corporate domain, encompassing commercial transactions as well as the expanding network of non-bank financial service providers.  The URDTT has been specifically created to ensure compatibility with the United Nations Commission on International Trade Law (UNCITRAL) Model Laws, which encompass many aspects of electronic commerce, electronic signatures, and electronic transferable records.

Diagram 1: How digital trade transactions works in respect of ICC regulatory frameworks Click here to view Diagram

Source: URDTT 2023, published by International Chamber of Commerce (ICC)

The Electronic Trade Documents Act 2023

The Electronic Trade Documents Act of 2023, come in forced from July 2023. The Electronic Trade Documents Act (ETDA) enacts the suggestions put up by the UK Law Commission in March 2022, thereby granting equivalent legal status to specific digital trade documents as their physical equivalents.

Diagram 2: How the electronic trade documents in place for making more secure digital trade. Click here to view Diagram

Source: ETDA 2023, published by International Chamber of Commerce (ICC).

The Electronic Trade Document Act (ETDA) pertains [diagram-2] to trade documents that require physical possession in order to possess legal validity and fulfil their intended purpose. According to the former legislation, the concept of possession was limited to tangible objects that could be physically handled. The current legal framework in the United Kingdom acknowledges the potential for individuals to own electronic documents.

Digital payments have a booming global market

The global volume of non-cash transactions, commonly referred to as digital payments, experienced a significant increase in the previous year, surpassing the 700 billion mark. This equates to an average of over 100 digital transactions per individual annually across the globe.  

The World Payments Report [figure 2], just published by Capgemini, provides a detailed analysis of the payments industry in over 40 representative areas worldwide. These markets include regions such as the Americas, Middle East, Africa, developing Asia, and mature Asia. The data was collected from reputable international sources such as the Bank for International Settlements, the European Central Bank, the World Bank, and various other organizations.The findings indicate a distinct shift towards digital payment methods, which aligns with an ongoing trajectory. Between the years 2018 and 2019, the global market share experienced a growth of 14%, resulting in a total of approximately 710 billion digital transactions by the conclusion of the previous year. According to Capgemini, this represents the most significant increase in market share observed in the past ten years.

Figure 2: The World Payments Report 2020 Click here to view Figure

The future digital payment market

The valuation of the global digital payment industry in 2022 [figure:3] amounted to USD 81.03 billion, with a projected compound annual growth rate (CAGR) of 20.8% from 2023 to 2030. In 2022, the global digital payments transactions reached a valuation over USD 8 trillion. The global surge in consumer demand for real-time payment solutions is a significant catalyst for the expansion of the market.  Based on statistical data presented by McKinsey & Company, the nation of India had a notable surge in real-time transactions, with a recorded total of 25.6 billion transactions in the year 2020.

This figure represents a substantial growth of 70% when compared to the previous year, 2019. The notable surge in the utilization of real-time payments inside the country can be identified as the primary factor contributing to the growing acceptance of mobile wallets. E-commerce service providers are actively endeavoring to enhance their competitive positions by transitioning from conventional credit card and consumer financing solutions to customer engagement solutions that harness the potential of digital payments.

Figure 3: The global digital payments industry report 2022. Click here to view Figure

Digitally delivered trade in Bangladesh

An overview and proposed solutions for the implementation of digital trade in Bangladesh was issued recently by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP). This report presents a comprehensive review of the current status of operations in Bangladesh pertaining to the electronic exchange of trade-related data, documents, and trade procedures. This report also examines the legislative frameworks that regulate electronic exchanges, encompassing both a broad perspective and a specific focus on adjacent countries. (ESCAP-2019-PB-Readiness-Assessment-Cross-Border-Paperless-Trade-Bangladesh.Pdf, n.d.).

The advancement of e-government development in Bangladesh has exhibited noteworthy achievements. The legal acknowledgment of electronic documents and electronic signatures is established by the Information and Communication Technology Act of 2006 and the Evidence Act of 1872, which has undergone recent revisions. To guarantee the safeguarding and conservation of data inside the territorial confines of Bangladesh, two legislative proposals have been presented for deliberation: The Digital Security Act of 2018 and the preliminary version of the Data Protection Act.

Presently, in the realm of commerce, the utilization of electronic means for transmitting bills of entry and bills of export, as well as import and export general manifests (IGM and EGM), is being implemented in seaports and airports. The electronic documents are sent to (The Automated System for Customs Data) ASYCUDA World (AW), a system that is fully functional in all customs stations. A supplementary provision that was enforced in January 2022 concerned electronic payment. A correlation has been established between the computer systems of Bangladesh Bank and AW for the purpose of validating LC-related data and Export Permission (EXP) Forms. As of September 2022, a functional interface has been established between the organization AW and the government agency-the Bangladesh Export Processing Zones Authority (BEPZA). To effectively evaluate, grant approval for, and streamline the transportation of imported and exported goods, it is essential to furnish tangible duplicates of the authentic paper documentation. Amendments were implemented to the Customs Act of 1969 with the purpose of facilitating the establishment of the Bangladesh Single Window and enabling the exchange of electronic trade information in accordance with international treaties.

The Chittagong Port Authority, which is tasked with the supervision of a significant portion of the country's global commerce, has effectively implemented the Terminal Operating System (TOS) and Automated Container Terminal Management System (CTMS) for the facilitation of imports. The Port Community System (PCS) serves as a platform for the digital submission of gate pass and delivery order applications, payment of relevant fees, and acquisition of essential documentation for the purpose of facilitating the operations of clearing and forwarding agencies, freight forwarders, and gate pass applicants.

In Bangladesh, there are comprehensive descriptions of trade procedures, including those pertaining to adjacent countries, that are readily accessible. The primary destinations for significant exporters are the United States, Germany, and the United Kingdom, with a notable focus on the ready-made garment (RMG) sector. Furthermore, it is worth noting that a significant proportion, namely over 40%, of all imports are sourced from China and India. These two countries primarily contribute to the import market by supplying energy resources and industrial raw materials, which constitute the primary categories of imported goods. In addition to its notable trading partners, Bangladesh's neighboring countries, namely India, Nepal, and Bhutan, with whom it has transit agreements, also hold considerable influence in the nation's international trade. Certain partner nations and businesses may provide priority to the electronic exchange of trade documents and data.

Bangladesh encounters three primary problems pertaining to overseas paperless trading. The challenges encompass the necessity of automating processes and enhancing the capabilities of personnel in border agencies, the establishment and complete execution of a unified platform for trade facilitation, and the imperative of forging agreements with trading partners and neighboring nations to facilitate the electronic exchange of trade-related information and documentation across borders.

The primary aim of this research is to examine the existing infrastructure in Bangladesh with regards to the electronic transmission of trade-related information. Bangladesh has successfully implemented and sustained the requisite systems. Presently, Bangladesh Customs System, commonly referred to as ASYCUDA World, is being employed. The ongoing process of developing the Bangladesh Single Window (BSW) is now focused on improving the flow of information across different government entities.

The research findings suggest that there is a requirement for more improvements in national systems, which encompass the complete execution of BSW and a broader adoption of the ASYCUDA World electronic document architecture, among other suggested measures.

In addition, the establishment of interoperability can be attained through adherence to globally acknowledged standards for the transmission of digital information. The study proposes the use of a flexible framework to enable the integration of developing technologies as needed in future times. Bangladesh has demonstrated its willingness to strengthen trade activities with neighboring and partner countries through the implementation of measures. The nation encounters three primary challenges concerning cross-border paperless trade, namely the necessity for automation and the enhancement of human capital within border agencies, the establishment and optimal operation of a unified window system, and the imperative for agreements with trading partners and neighboring countries to facilitate the electronic exchange of trade data and documents across national boundaries.

In order to facilitate effective transnational electronic data exchange, it is important to do a comprehensive analysis and identification of the appropriate target documents and target system(s) for the purpose of electronic data sharing.

The decision-making process for this choice should be carried out collaboratively, involving partner nations, while considering the interests and capabilities of all parties concerned. The research study proposes that Bangladesh should engage in discussions with its partner nations concerning the following official documents: (1) Pre-arrival information; (2) Certificate of Origin; (3) Customs Declaration; (4) Import General Manifest (IGM) and Export General Manifest (EGM); (5) Dangerous Goods Information; and (6) Invoice.

The report additionally suggests giving priority to the installation of ASYCUDA World as the primary system for the management of these materials. Once the target system has reached its maximum operating capability and has been fully established, it can be changed to function as a subsystem that is seamlessly integrated into the National Single Window (NSW).

It is also recommended to conceptualize the target system and the electronic data exchange system as distinct entities. The responsibility of the electronic data exchange system is to receive the designated electronic document from the specified system and thereafter transmit it to neighboring countries and partner nations. The aforementioned framework delineates the proposed strategies designed to enhance the transnational movement of electronic data. Prior to initiating the aforementioned procedure, it is crucial to execute the conversion of documents into a generally recognized e-message format that has been collectively defined and agreed upon by all relevant parties. There will be a prioritization of the transmission and reception of electronic documents from partner and neighboring nations to the designated system. Moreover, it is crucial to build a comprehensive cyber-security policy to effectively support the seamless transmission of electronic data across international boundaries. The selection of a governing entity or entities should align with the planned organizational strategy for implementing the future state model in the domain of electronic data interchange with partner nations. The National Board of Revenue (NBR) in Bangladesh might be considered as an exemplary example of such an organizational entity. In order to achieve optimal integration of their information systems, it is imperative for the designated lead agency or agencies to actively engage in collaborative initiatives.

It is recommended to utilize either ASYCUDA World or BSW as appropriate tools for documenting user needs and facilitating data interchange. The systematic and incremental implementation of the TO-BE idea for electronic data sharing with neighboring nations can be achieved through a deliberate and phased approach. The proposed measures involve the establishment of bilateral agreements aimed at facilitating the electronic transmission of data in cross-border trade, eliminating the requirement for physical paperwork.

The proposed course of action involves establishing a specialized task force, determining the particular government agencies or systems/documents to prioritize, evaluating and enhancing current legal frameworks, engaging in discussions regarding technical aspects such as security and data exchange methods, and executing and introducing the aforementioned initiatives. Given the circumstances outlined above, it is advisable to develop a strategy framework for the creation of an organization that can effectively implement the TO-BE model. This institution would be responsible for facilitating the seamless flow of electronic trade data between different countries.

The research highlights the significance of enhancing cross-border trade facilitation by means of collaborative endeavors with neighboring nations. This entails assessing the effectiveness and reciprocal benefits of such collaboration, as well as devising feasible solutions to promote the exchange of electronic trade information across many nations. Bangladesh's progress in attaining the goal of cross-border paperless trade would be bolstered by its commitment as a signatory to the Framework Agreement on Facilitation of Cross-border Paperless Trade in Asia and the Pacific (CPTA). The United States convention holds the potential to provide Bangladesh and its partner states with a comprehensive and enabling framework for supporting and advancing cross-border paperless trade.

Bangladesh has demonstrated its political resolve and commitment to promoting cross-border paperless trade by acceding to the Framework Agreement. Nevertheless, the effective execution of cross-border paperless trading necessitates a substantial investment of both time and financial resources. In order to promote the development of an effective electronic trade-related data exchange system with neighboring nations and trading partners, it is imperative for Bangladesh to continue its efforts in improving its national systems, infrastructure, and human resources.

Implementation of Digital Trade in Bangladesh: Perceptions of Stakeholders [Primary Data analysis]

The implementation of digital trade in Bangladesh refers to the use and integration of digital technologies in the country's commercial activities. The study aims to examine the implementation of digital trade in Bangladesh and its implications.

The focus of this research is to explore the perspectives and opinions of many stakeholders on this matter.

The outcomes of a survey conducted on digital trade in Bangladesh with 300 respondents and utilized a Likert Scale questionnaire with a 5-point response structure ranging from “Strongly Agree to Strongly Disagree “can be interpreted as providing insightful information.

Diagram 3: Frequency of recipient responding on digital transformation in Bangladesh Click here to view Diagram

Chart 1: Digital Trade Transformation in Bangladesh Click here to view Chart

This above chart 1, showing the relationship between Axis-(Y): which represent the responses of the sampled respondents, and axis-(X): which represent the surveyed questions. From those analyses it can be seen that, majority of the respondents are agreed with the following statements.

Bangladesh's competitiveness is enhanced using cross-border paperless trade:

Bangladesh's international trade has led to a growing integration of the country with the global economy. But unlike most of its rivals, Bangladesh's high trade costs continue to stand in the way of its ability to conduct international business more effectively. This high trade cost was mostly caused by the nation's border operations, which were extremely inefficient. With 44.5% of its implementation commitment completed, Bangladesh is also falling short of its WTO (World Trade Organization) Trade Facilitation Agreement (TFA) [figure 4].

Figure 4: Implementation status of WTO trade facilitation measures in Bangladesh, 2023 Click here to view Figure

Source: TFAD - Trade Facilitation Agreement Database (tfadatabase.org)

According to Figure 5 from the United Nation (UN) Global Survey on Digital and Sustainable Trade Facilitation 2023, it can be observed that Bangladesh's progress in implementing trade facilitation measures is comparatively lower than the average progress observed in the Asia-Pacific region. The implementation of cross-border paperless trade measures in the country lags behind the regional average.

Figure 5: Trade facilitation and paperless trade in Bangladesh, 2023 Click here to view Figure

Source: UN Global Survey on Digital and Sustainable Trade Facilitation (https://untfsurvey.org/)

In addition, the adoption of paperless and international trading regulations has the potential to substantially decrease trade expenses for a nation. According to a recent study conducted by the Asian Development Bank (ADB) and the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), it has been projected that the implementation of digital trade facilitation measures in Asia-Pacific nations will lead to an average reduction in trade costs.

The study estimates that the reduction will be more than 13 percent if the measures are fully implemented, and 7 percent if only the measures outlined in the Trade Facilitation Agreement (TFA) of the World Trade Organisation are implemented (ADB & ESCAP, 2021). By fully adopting a paperless approach to business, particularly in the context of cross-border trade, Bangladesh has the potential to enhance its competitiveness within the global trading arena. In order to facilitate international electronic commerce, which encompasses the transmission of trade-related information and documentation across borders, it is imperative to establish national digital systems that are sufficiently equipped with automation, interoperability, and robust information and communication technology infrastructure.

Due to the considerable time, resources, and efforts required for the full implementation of work automation systems for paperless trade at the national level, particularly in the context of cross-border transactions, countries frequently opt to initiate electronic exchange of trade-related data and documents at the agency level. The 2019 assessment of Bangladesh's preparedness for cross-border paperless trade encompassed the inclusion of an initial action plan and suggestions (ESCAP-2019-PB-Readiness-Assessment-Cross-Border-Paperless-Trade-Bangladesh.Pdf, n.d.).

This study utilizes the findings from the preliminary investigation and the subsequent update conducted in 2023 to substantiate a specific action item. The action item in question pertains to enabling the automation systems of relevant regulatory entities involved in both domestic and cross-border paperless trade. The potential implementation of a pilot program for electronic data and document exchange, which can be replicated and extended to encompass additional documents and agencies as required and in alignment with Bangladesh's defined objectives, presents a viable opportunity for Bangladesh to make progress towards cross-border paperless trade. Bangladesh is a signatory to the United Nations Framework Agreement on Facilitation of Cross-border Paperless Trade in Asia and the Pacific. This agreement has the potential to facilitate and advance the country's engagement in cross-border paperless transaction.

Bangladesh is ready to implement digital trade transactions: Current status

ESCAP conducts an examination of the current status of international electronic trade information and document interchange, trade procedures, relevant legal frameworks, and the ICT infrastructure of Bangladesh. This analysis specifically focuses on the country's significant trading partners and neighboring nations. Additionally, it offers a concise summary of the primary challenges and barriers, together with the necessary conditions and requirements, for the TO-BE model.

Policy supports

The import and export activities in Bangladesh are largely governed by three key legislations: The Foreign Exchange (Regulation) Act of 1947, the Customs Act of 1969 (Act No. IV of 1969), and the Imports and Exports (Control) Act, 1950 (Act No. XXXIX of 1950). These three complementing Acts give the Bangladeshi government the legal foundation upon which to build further guidelines, directives, and strategies to manage and carry out export- and import-related operations in Bangladesh. The regulation of imports and exports of goods and services is facilitated by the Imports and Exports (Control) Act of 1950, granting the government the authority to exercise control over these economic activities. There are two significant policy papers that govern export and import activities in Bangladesh. These are the Import Policy Order, which is presently in effect, and the Export Policy, specifically the Export Policy 2021–2024, which is currently in effect. Both of these policies are developed on a rolling three-year basis. Electronic transactions in Bangladesh are governed by a few additional laws and regulations.

Acceptance of trade data and document submission using electronic means

A few articles of the Customs Act, 1969, the main piece of legislation governing the conduct of international trade to and from Bangladesh, provide for the electronic submission of trade data and records. Bills of entry and other documents supplied electronically are accepted under Chapter IX, Article 79A. The Act mandates that bills of entry, bills of export, and import general manifests (IGM and EGM) be submitted electronically. It is also required to pay customs and taxes electronically beginning of January 2022. In order to create the Bangladesh Single Window, a new clause known as Article 197.D under Chapter XX was added in 2020 and modified in 2021. This clause mandates the electronic submission of all documentation, including certificates, licenses, and permits, for the import, export, warehousing, transit, and transshipments of goods.

Arrangements to facilitate trade through information exchange:

The Customs Act was amended with a new clause in June 2022 to enable cross-border information sharing for trade facilitation. The Government has the authority to engage in various forms of agreements, such as bilateral, regional, and multilateral agreements, as well as conventions or other arrangements. These agreements serve the purpose of facilitating trade, conducting effective risk analysis, verifying compliance and prevention measures, as well as combating and investigating offenses outlined in this Act. The criteria indicated above is specified in Article 204.B(2) in Chapter XX of the Customs Act of 1969. This provision grants the Government the authority to participate in bilateral, regional, or global agreements concerning the cross-border electronic exchange of business/trade data.

Usage of electronic records and digital signatures

The country initially accepted electronic signatures and records when the Information and Communication Technology (ICT) Act, 2006 was passed (and then revised in 2013). This law establishes a foundation for electronic records and digital signatures, which are the foundation of all electronic transactions within the nation. According to legal doctrine, data included in electronic records is entitled to the same legal protections as data or other materials that are typewritten, printed, or otherwise presented in written form. Likewise, any data or item can be verified through the use of a digital signature attached in a specific way. Since the Evidence Act 1872 was amended in November 2022, digital signatures and electronic records are now accepted as forms of evidence. The modification additionally permits the court to take into account as a material fact the certifying authority's view, which is the source of the digital signature certificate.

Foreign certifying authority has yet been approved digital certification by CCA:

An Office of the Controller of Certifying Authorities (CCA) has been established with the purpose of licensing, overseeing, and managing all Certifying Authorities responsible for issuing certificates for digital signatures, e-sign certifications, and related topics. As of April 2023, it has been observed that six certifying authorities in Bangladesh have been granted licenses by the CCA (Certification Authority). While it is currently the case that no foreign certifying authority has been officially awarded jurisdiction, the existing law does allow for the recognition of any foreign certifying body as a Certifying Authority.

Data protection and digital security:

In order to guarantee national digital security and establish legislation pertaining to the identification, prevention, suppression, trial, and other relevant offenses committed using digital devices, the government of Bangladesh passed the Digital Security Act, 2018. To stop computer-related and digital device-related cybercrimes, a Digital Security Agency was founded. Bangladesh does not yet have a data protection laws in place. The government is presently reviewing a draft Data Protection Act 2022, which stipulates that sensitive, user-generated, and classified data must be kept in Bangladesh and will not be subject to the jurisdiction of foreign courts or law enforcement agencies. However, provided that the data subject's consent is obtained, and with the aim of maintaining international relations, facilitating international trade, managing immigration, or for any other valid purpose involving countries or organizations outside the borders of Bangladesh, the transfer of sensitive and user-generated data beyond the nation is permitted.

Legal framework is mostly conducive to start digital trade:

The statutory structure in Bangladesh mostly supports the implementation of the provision of electronic documents and data as well as the participation in international electronic trade data exchange. However, it is essential to establish and enforce the appropriate agreements and processes with trading partners in order to ensure the successful implementation of cross-border interchange of electronic trade data. Moreover, it is crucial to establish the necessary information and communication technology (ICT) infrastructure and technical capabilities among relevant firms, including importers and exporters.

Policy implemented by Trade-related institutions:

The Ministry of Commerce (MOC) is the principal organization responsible for developing, putting into practice, upholding, coordinating, and overseeing the policies and initiatives associated with global trade in products and services. Additionally, it serves as the hub for trade discussions on a bilateral, regional, and global level. In Bangladesh, the highest authority for tax administration is the National Board of Revenue (NBR). In addition to negotiating tax treaties with foreign governments and taking part in inter-ministerial discussions on economic matters pertaining to fiscal policies and tax administration, NBR is in charge of creating and regularly reviewing tax-related legislation and regulations. One of the three tax collection organizations under NBR, Bangladesh Customs is in charge of organizing, developing, putting into effect, and routinely reviewing and reevaluating policies pertaining to customs-related issues. Bangladesh Customs also keeps an eye on the operations of Customs stations and gives field offices instructions and interpretations of laws and policies pertaining to customs. Other government Ministries and Departments are in charge of particular aspects of trade-related laws and initiatives in Bangladesh; in particular, Bangladesh Bank is the supreme authority to oversee and manage all commercial banks' operations when it comes to adopting digital trade transactions.   Goods have been released from customs with banks' active support and endorsement.

Logistics and ICT Infrastructural supports:

Over the past 20 years, Bangladesh has demonstrated a strong track record of ICT infrastructure expansion and development. A brief status report on the availability of energy, mobile network service, telecommunication, internet, data, and online services, as well as electronic payment choices.

Availability of Electricity:

In terms of the quality of its energy supply, Bangladesh was placed 68th out of 141 nations by the Global Competitive Index 2019. Nonetheless, recent years have seen a significant advancement in the production of electricity. As per the World Bank Global Electrification Database "Tracking SDG 7: The Energy Progress Report", 85.2% of Bangladesh's total population was connected to the electrical grid in 2020. In April 2022, Bangladesh's ability to supply energy was 23452 Megawatt (MW), with 1160 MW coming from imports. The Bangladeshi government is also exploring a range of methods, ideally utilizing renewable energy sources, to diversify the supply of electricity. Even still, renewable energy only makes up 1.1% of Bangladesh's total generation under the current generating scenario—0.98% comes from hydropower and 1.1% from solar power.

Internet access and the telecommunications network:

As of June 2022, the communications network of the country encompassed a comprehensive coverage of the nation's remote regions and islands, with the inclusion of the majority of these areas within its 64 districts. As of June 2022, the extent of optical fiber communication had expanded to a distance of 165.9 thousand kilometers, accompanied by a bandwidth capacity of 3,747 Gigabits per second (Gbps). Nevertheless, the actual utilization of bandwidth was at a lower level of 2,936 Gbps. The country possesses two landing places for underwater cables. The two submarine cable systems, namely SMW-4 in Cox's Bazar and SMW-5 in Kuakata, have been established for telecommunications purposes. SMW-4 was initially put into operation in 2005, while SMW-5 commenced its operations in 2017. The plan to construct a third undersea cable landing station in Cox's Bazar is now being considered. At now, the total number of mobile subscribers is at 184.4 million, exhibiting a mobile density of 106%. Currently, there is a total of 79.1 million mobile users who have the capability to connect to the 4G network. The global population of internet users is estimated to be 126.2 million individuals. Among these users, around 115 million individuals utilize mobile devices to access the internet, while 11.2 million individuals rely on PSTN and ISP networks for internet connectivity. The performance of Bangladesh throughout the course of the last two decades can be observed in Figure 10 of the United Nations E-Government Development Database (UNeGovDD) Telecommunication Infrastructure Index.

Information, Infrastructure, internet-based services & data center:

In 2010, Bangladesh set up a conventional data center with three tiers. Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS) are the three service categories offered by data centers. These categories include cloud, virtual private server (VPS), load balancing, collocation, email, web and application hosting, and managed services. In Kaliakair Hi-Tech Park, Dhaka Division, a new National 4-tier Data Center is being constructed to act as a backup for the original National Data Center. For the safe recovery of public data, there is also a Disaster Recovery Data Center.

Over the course of the past decade, the government has placed significant emphasis on the provision of electronic services to all inhabitants. In order to achieve this objective, a robust internet backbone network has been implemented, utilizing Dense Wavelength Division Multiplexing (DWDM) technology. This network has been deployed across various governmental entities, including ministries, government directorates/departments, all 64 districts, all 488 Upazilas (sub-districts), and 18,130 government offices. The primary goal of this initiative is to expand the reach of the government's information and communication technology (ICT) network to the most decentralized levels of administration and the general public. The ongoing initiative involves the provision of high-speed internet connectivity to all unions, which represent the lowest level of administrative units.

Additionally, since 2010, 4,554 Union digital centers have been in operation. These centers act as one-stop shops for information and service delivery for all union parishads, the lowest level of local government in Bangladesh, offering e-services to the local populace.

The establishment of the Bangladesh National Digital Architecture by the government aims to incorporate a range of standards, such as application architecture, business architecture, data architecture, e-Graphics Interchange Format (e-GIF), mobile services delivery platform, security, and technological architecture. The main goals of this effort encompass the provision of well-organized digital services, cost reduction in development, and the improvement of service quality by optimizing work methods.

Digital payments

In the past ten years, Bangladesh's payment system has experienced a fundamental transformation, and the country's digital payment market is exhibiting great promise. The National Payment Switch, which was implemented in 2012, is a significant advancement that forms the fundamental framework for financial system interoperability. As of the start of 2023, the nation had made significant progress in the areas of financial inclusion and internet access. Bangladesh has also seen a remarkable increase in the accessibility of digital financial accounts due to the spread of branchless banking. The full-service retail banking has been brought to people's doorsteps.

E-Governance and E-participation:

Bangladesh's government has taken steps to provide e-services by establishing a national service web portal (http://services.portal.gov.bd/), in response to the country's growing ICT infrastructure and rising citizen e-participation. Government online services are available through this platform in 761 forms. Furthermore, from October 2019, an online utility bill payment system has been available. When it comes to investment, the Bangladesh High-Tech Park Authority, Bangladesh Economic Zone Authority, Bangladesh Investment Development Authority, and Bangladesh Export Processing Zone Authority (BEPZA) all offer one-stop services. These changes were in line with Bangladesh's steady improvement over the previous 20 years in both the United Nations E-Government Development Database's (UNeGovDD) E-Government Development Index and E-Participation Index. Bangladesh dropped from 150 just 10 years ago in 2012 to 111 out of 193 nations in the E-Government Development Index in 2022 (UN E-Government Knowledgebase, 2023). Throughout this time, it showed a noticeable development in each of the three subcategories: online services, telecommunication infrastructure, and human capital index. Additionally, there was a significant improvement in E-Participation from 7.9 percent in 2012 to 52.2% in 2022.

E-Process Setting for Trade and Customs:

The creation of an e-Customs environment is a primary objective of the Modernization Plan of Bangladesh Customs, aimed at providing support to the e-Governance program implemented by the Bangladeshi government. Bangladesh Customs has been utilizing ASYCUDA World since 1994. The transition to ASYCUDA++ occurred in the year 1999. The Automated System for Customs Data (ASYCUDA4F2) was built in 1994. Currently, AYCUDA World accepts electronic submissions of several documents, including the IGM, EGM, Bill of Entry, Bill of Export, and Bill of Lading. Commencing in January 2022, it is mandatory to utilize electronic payment methods for the settlement of customs charges and fees. In order to streamline the process of both inbound and outgoing cargo, ASYCUDA World conducts customs inspections and utilizes computerized means to issue exit notes and orders. In order to obtain final permission for duty assessment and products clearance, it is necessary to present all paper paperwork, including but not limited to IGM, EGM, bill of entry, bill of export, invoice, and packing list.

ASYCUDA World provides a diverse range of electronic interfaces to promote essential communication between Bangladesh Customs and external entities. Currently, Bangladesh Bank and ASYCUDA World possess an interface that facilitates the authentication of LC-related data and EXP forms originating from approved dealers. Since September 2022, an interface has been built between ASYCUDA World and BEPZA to facilitate the electronic submission of export and import licenses issued by BEPZA. Import and export registration certificates and licenses are electronically awarded by the Chief Controller of Import and Export (CCI&E) based on online applications filed through the Online Licensing Module (OLM). Currently, there is no existing interaction between ASYCUDA World and OLM of CCI&E. The document can be confirmed by the Customs authority through the use of OLM. The outstanding relevant documents have not yet been submitted in hard copy format.

The Chattogram Port Authority, responsible for supervising the majority of the country's international trade, has successfully implemented the Automated Container Terminal Management System (CTMS). The present system facilitates the electronic submission of gate pass and delivery order applications, fee payments, and document retrieval for customs and freight agents, as well as freight forwarders. The Terminal Operating System (TOS) is being implemented as a replacement for the Container Terminal Management System (CTMS). The Port Community System (PCS) at Chattogram Port is a submodule of the Terminal Operating System (TOS). The Vessel Traffic Management Information System (VTMIS) is a seaport infrastructure that facilitates secure navigation and ensures the safety of foreign ships. The system is located at Mongla Port.

The goal of the Bangladesh Land Port Authority (BLPA) is to include electronic service (e-Service) into its routine activities. The implementation of the "e-port management system" was carried out by the Bangladesh Land Port Authority (BLPA) at the Burimari land port located in the Lalmonirhat district in the year 2020. The system's design was to ensure the digitalization of invoicing, posting of goods, issue of BLP gate passes, online delivery, online monitoring and reporting, online payment system, and other relevant information pertaining to Indian truck drivers and clearing and forwarding agents. The integration between e-port systems and ASYCUDA World has not been established at present. Based on the available information, it can be inferred that ASYCUDA World received the Import General Manifest (IGM) in an electronic format and subsequently transmitted it to the Port Authority by email. The Customs release order and exit letter can be accessed by the Port Authority using the ASYCUDA World online platform. The implementation of a "e-port management system" at Bhomra Land Port is being facilitated by the Bhomra Land Port Authority (BLPA) in collaboration with the Global Alliance for Trade Facilitation.

The current manual procedures utilized for the management of cargo, weight, gate passes, yard/shade, billing, and alerts will be substituted by the newly implemented, tailored system. The e-Inland traffic management system, now in the pilot stage of development, is being constructed by the Bangladesh Inland Water Transportation Authority (BIWTA) with manual processing.

The border agencies of Bangladesh, which encompass customs among other entities, are presently in the process of implementing automation measures. This will enable anyone to create an electronic interface for the purpose of submitting and verifying documents. The Customs Authority will establish a connection between ASYCUDA World and the Certificate/License/Permit Issuing Agencies (CLPIA) listed below.

The implementation of the Bangladesh National Single Window (BSW) was initiated in 2018 with the assistance of the World Bank's "Bangladesh Regional Connectivity Project," which offered support to the National Board of Revenue (NBR). The concurrent operation and integration of ASYCUDA and Bangladesh Single Window (BSW) has been established. To facilitate the implementation of BSW, the National Bureau of Regulations (NBR) established formal agreements, known as memorandums of understanding (MoUs), with 38 departments and entities. Additionally, certain Comprehensive Legal and Policy Impact Assessments (CLPIAs) would be integrated into the BSW framework. However, a significant proportion of these Cross-Linked Parallel Integrated Architectures (CLPIAs) are still in the process of being prepared for integration into a single window system. This delay in the complete integration of the Business System Workflow (BSW) could potentially occur as a result.

The establishment of BSW in Bangladesh has been pledged by the Government, with a targeted completion date of June 30, 2030, as indicated in the latest communication to the World Trade Organization (WTO document G/TFA/N/BGD/1/Add.5, dated August 19, 2022). The National Board of Revenue (NBR) foresees that BSW will commence operations well in advance of the date given by the World Trade Organization(WTO).

Work process digital trade for and documentary requirements

Bangladesh's import and export trade procedures are primarily regulated under the Customs Act of 1969. The prescribed requirements for document submission are delineated in the 2001 Prescribed Bill of Entry and Bill of Export Form Order issued by the National Board of Revenue of Bangladesh. The submission of manifest data, which encompasses a comprehensive description of the imported products transported by ship, to the Customs authorities in Bangladesh is a requirement that importers or their C&F agents must fulfill either through manual or computerized means. In order to facilitate the importation process into Bangladesh, importers or their C&F agents are required to submit their manifest data, containing a comprehensive description of the commodities being imported by ship, to the Customs authorities. This can be done either manually or electronically. When engaging in the importation of products by truck transportation, specifically through land customs stations, the driver or trucking firm assumes the responsibility of informing the customs authorities regarding the Import General Manifest (IGM). The Bill of Entry or statement must be submitted in a particular format called a Single Administrative Document (SAD). The following documentation (and the applicable laws within the bracket) must be submitted with the declaration for all import kinds in order for Customs to release the goods from Customs:

A supplementary document is required for a variety of commodities.

• According to the Import Policy Order, 2021–24, the possession of a certificate issued by the Bangladesh Standards and Testing Institution (BSTI) is mandatory in cases where an accredited laboratory certificate from the exporting country is not obtainable. Additionally, the clearance of 55 specific commodities necessitates compliance with the Bangladesh Standards (BDS) norm.
• This paper presents an analysis of the radioactivity tests conducted on food products by the responsible authority of the exporting countries, as outlined in the Import Policy Order of 2021-24.
• According to the Import Policy Order, 2021-24, it is required to get certificates of clearance from the Bangladesh Atomic Energy Commission as evidence that imported food items conform to acceptable radiation levels.
• The Pre-Shipment Inspection test report pertains to many commodities, including milk food products, powdered milk, coal, hard coke, Break Acrylic (HS 39.15 and 3915.90), M.S. Billets (7207), and things that are allowed for import by public sector organizations, provided their value is equal to or exceeds Taka fifty lac per item.
• The document pertaining to the authorization of explosives import is issued by the Chief Inspector of Explosives under the Ministry of Power, Energy, and Mineral Resources, in accordance with the Import Policy Order of 2021-24.
• According to Paragraph 5(6)(c) of the Import Policy Order, 2021-24, the importation of branded goods that are protected under intellectual property laws in Bangladesh necessitates the submission of an intellectual property certificate issued by the intellectual property rights holder in the exporting country.

The digital trade is being gradually modernized by a wave of new technology with challenges

Bangladesh has achieved notable strides in the realms of digital services, e-participation, and e-government. Arrangements are being taken to strengthen the governing environment for supporting electronic dealings, e-payment acceptance, e-signature recognition, and other aspects of digitalization. Both the ICT Act of 2006 and the recently updated Evidence Act of 1872 grant electronic records and electronic signatures legal legitimacy. The purpose of the newly proposed Data Protection Act and the Digital Security Act 2018 is to control cross-border transactions of electronic data and documents while also ensuring digital data security.

Several amendments have been implemented to the Customs Act of 1969 with the aim of facilitating commercial activities. One of the notable features is the capacity to electronically transmit Import General Manifests (IGM) and Export General Manifests (EGM), as well as bills of entry and bills of export, to ASYCUDA World, a system accessible at all customs stations.

Furthermore, the Act has undergone revisions to establish the Bangladesh Single Window and facilitate the electronic interchange of trade data through various bilateral, regional, multilateral, or other agreements with foreign countries. All seaports and airports currently have IGM and EGM, and ASYCUDA World receives electronically submitted bills of entry and export. To authenticate data connected to LC, an interface has been established between Bangladesh bank's computer system and ASYCUDA World. Since January 2022, e-payment of customs duties and fees is also required.

Nonetheless, original copies of all paper papers must still be submitted in order for import and export consignments to be evaluated, cleared, and released. The Chittagong Port Authority, responsible for overseeing the majority of Bangladesh's international trade, has successfully implemented the Automated Container Terminal Management System (CTMS) and Terminal Operating System (TOS). A similar system is presently being implemented at Bhomra Land Port, while another system known as the "e-port management system" has been introduced at Burimari Land Port. However, their functionality falls short of meeting the objectives of a fully paperless system.

In order to facilitate the implementation of cross-border paperless trade between Bangladesh and its trade partners, it is imperative that all border and trade-related agencies possess the essential ICT infrastructure and capacity. This includes the ability to connect digitally with one another and with their counterparts across borders through digital interfaces.

Bangladesh is now dealing with the following main obstacles and problems in adopting cross-border paperless trade:

Acceptability supports by the end users

The adoption of digital transactions is widely supported by various stakeholders, including banks, customers, businesses, and other entities involved in the financial system. The survey findings indicate that a significant majority, almost 58%, expressed high agreement with engaging in digital trade transactions.  

Findings

The following is a summary of the obligations from users and government agencies regarding the processing and exchange of electronic commerce data.

Promote collaboration with surrounding nations, particularly India.

E-customs system

The following graphic depicts the TO-BE paradigm. The e-Customs system of Bangladesh, known as ASYCUDA World, has the potential for further improvement in facilitating electronic processing of export and import processes, as well as promoting cross-border paperless trade and transit. The solid line in the illustration symbolizes the implemented aspects, while the dotted line signifies the areas that require further improvement or future implementation.
 

Figure 6: TO-BE target systems Electronic trade method and data exchange model Click here to view Figure

The implementation of the Bangladesh National Single Window
 

Future scope and implications

The transformation of digital trade has the potential to address compliance issues and necessitates the implementation of more secure data warehouses. Bangladesh, which aims to enhance digital trade, has new obstacles due to the cross-border nature of data flows. Bangladesh must strike a balance between the privacy and security concerns of its residents and the private sector's requirement for unrestricted data flow in order to engage in digital trade and global value chains (GVCs). Fifty Storing data locally does not offer greater security in comparison to storing the data in dedicated secure servers located overseas. In response to data flow restrictions imposed by other nations, Bangladesh can establish robust regulations that safeguard data in accordance with globally acknowledged principles, such as the OECD's Privacy Guidelines and its Declaration on Cross Border Data Flows, as well as the APEC's Privacy Framework. Obstacles to the movement of data can be addressed by international and regional accords, such as the Trans-Pacific Partnership Agreement.

Conclusion

International trade procedures must establish an effective processing system in order to handle the growing volume and value of cross-border commerce. Because of the widespread use of developing technologies in the trade and transit sectors, trade processing is undergoing a significant period of change. The implementation of cross-border paperless trade, which involves the utilization of electronic data and documents, can enhance the competitiveness and efficiency of international trade operations. The exchange of electronic trade data has the potential to facilitate paperless cross-border trade with partner nations, leading to improvements in transparency, predictability, and interoperability.

The nation made great strides in e-participation, infrastructure, and human capital—the three pillars of the digital economy—while putting the national vision of "Digital Bangladesh" into practice. Bangladesh has also consistently increased its exports and made significant strides toward enacting trade liberalization policies. To improve Bangladesh's trade competitiveness, however—and in particular, to embrace the digitization of trade procedures—much more work needs to be done. The implementation of global electronic exchange of trade data is a pivotal element in the process of digitizing trade procedures.

This research proposes the implementation of cross-border/internationally electronic trade data exchange in Bangladesh as a means to enhance national productivity and competitiveness in the global market, while also fostering the emergence of novel industries and services. The research proposes the implementation of trade system automation and the incorporation of emerging technologies, when feasible, as means to revolutionize trade procedures. By strengthening preemptive prevention and quick response, this will also assist the nation improve trade system productivity, dependability, and competitiveness while boosting safety and resilience. Such trade procedures can be made transparent, sustainable, and interoperable by automating tasks and implementing pertinent developing technology.

This paper presents a viable strategy for Bangladesh to establish electronic trade data and document exchange with its neighboring nations, emphasizing the significance of regional collaborations. The development of the suggested mechanism for exchanging cross-border electronic commerce data should take into account several factors, including prospective pilot-based service scenarios, target systems, procedural methodology, system architecture, organizational strategy, implementation timetable, and resource requirements.

The study outlines a comprehensive analysis of potential avenues for the electronic cross-border exchange of trade data, highlighting a multitude of discernible benefits. The assessment and endorsement of the proposed TO-BE model by the Government of Bangladesh, along by a suitable level of informatization and system computerization, is necessary to facilitate the implementation of cross-border electronic trade data interchange. In order to enhance the facilitation of cross-border paperless trade, it is imperative to engage in collaborative efforts with trading partners and neighboring countries. This Collaboration plays a crucial role in evaluating the collective benefits, ascertaining the viability of system compatibility and information interoperability, and devising mutually agreeable approaches to facilitate the international electronic flow of trade data.

Acknowledgement

The study is conducted with the primary aim of satisfying the researcher's personal fulfillment, while also making a contribution to the current state of knowledge by publishing an article that addresses contemporary concerns. Furthermore, the study contributed as a compulsory requirement for the researcher's academic evaluation.

I am hopeful that in the upcoming year, I will have the opportunity to enroll in a prestigious university's PhD program and devote myself in advanced academic pursuits.

Conflict of Interest

There is no Conflict of interest.

Funding Sources

There are no Funding.

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