Bangladesh has secured tariff exemptions for select garments and textile products made using American materials under a new trade agreement with the United States, according to a BBC report. As part of the arrangement, the US will also reduce tariffs on Bangladeshi goods to 19% from 20%, while Dhaka will widen access for American products in its domestic market.

The agreement follows months of negotiations after Washington imposed broad tariff measures on trading partners last year. Officials from both sides said the deal is intended to deepen economic ties and expand market access for exporters in both countries.

Under the pact, certain clothing and textile items produced with US cotton and synthetic fibres will qualify for duty-free entry into the American market. The scale of these tariff-free exports will be linked to the volume of US textile shipments to Bangladesh.

The clothing and textile sector remains critical to Bangladesh’s economy, accounting for more than four-fifths of export earnings and employing roughly 4mn workers. The country is currently the world’s second-largest apparel exporter after China.

In return for tariff concessions, Bangladesh has agreed to grant preferential access to a range of American goods, including agricultural produce and industrial products such as chemicals, medical equipment, automobile components, soy products and meat.

The agreement is expected to provide some relief to Bangladesh’s export sector while strengthening bilateral trade flows between the two countries.