The US midterms: What they mean for Bangladesh

According to early results from the US midterm elections as of November 4, the Democrats have won back control of the Senate. The Associated Press projects that they have taken at least six Republican-held seats, where they needed four for the majority.

They are also reported to have secured a majority in the House of Representatives, though the final count is still under way. President Donald Trump will therefore spend the last two years of his term under a divided government: one party in the White House, another in Congress.

Divided government does not mean a sudden U-turn in policy. It means checks and bargaining. The president keeps his executive orders, much of his trade authority and his veto. But the keys to the budget, new legislation, investigations and the funding of war now sit with Congress — in the Senate, at the very least. 

For Bangladesh, then, the question is not which party won. The question is which of the American decisions that touch our economy directly now rest in whose hands, and which of them can actually change.

Start with trade. The United States is Bangladesh’s largest single export destination. In fiscal 2025-26, Bangladesh shipped $9.04 billion worth of goods there, $7.74 billion of it ready-made garments; roughly 20 percent of the country’s garment exports go to America. 

Over the past year and a half, the tariff regime in that market has been the most uncertain chapter of all: Trump’s “reciprocal” tariffs in April 2025; the US Supreme Court striking them down in February 2026; a temporary 10 percent tariff after that; and from July, on a different legal footing — Section 301 of the Trade Act — another 10 percent. All told, Bangladeshi garments now face a total duty of about 25.62 percent, against 15.62 percent before 2025.

Can the new Congress bring that tariff down? Not directly, in all likelihood. Section 301 tariffs are imposed under the executive branch’s authority, and even if a law to scrap them were passed, getting it past a presidential veto would be hard. But tariff policy will no longer be the White House’s game alone; hearings, investigations and budget pressure will raise the political cost of imposing new tariffs. For Bangladesh, this means not quick relief, but some protection against even greater uncertainty. And one real bargaining opportunity is already on the table: the US Trade Representative’s office is considering a duty-free quota for goods made with American cotton and textile inputs for a handful of countries, Bangladesh among them. Both parties in Congress have members from cotton-growing states, which makes the proposal attractive regardless of party.

The second area is aid. When USAID’s programmes were shut down in 2025 and foreign aid was slashed, the most visible blow landed on the camps of Cox’s Bazar. The 2025 appeal for nearly 1.2 million Rohingya was only 46 percent funded, and the 2026 joint response plan asks for $710 million, 26 percent less than the year before. 

Democrats have traditionally backed humanitarian aid, and in budget negotiations they may try to restore some of the money for humanitarian work. But if the White House does not want it, there are obstacles even to spending that money, so Bangladesh should see this as a possibility, not a certainty.

The third area is remittances and immigration. Since January 1, 2026, a 1 percent tax has applied to remittances sent from the United States in cash, though money sent through banks or digital channels is exempt. Repealing the law would take a new act of Congress and the president’s signature, so hopes of a quick change are slim. 

If anything, it could become one more reason for expatriates to send money through formal channels, which is positive for Bangladesh. The application of immigration policy, such as visa controls or deportations, rests mainly with the executive branch; Congress can apply pressure through investigations and funding, but rewriting the policy wholesale is hard. 

For Bangladeshis living in the United States, this election may be a reassuring signal, but it is not a guaranteed solution.

Yet the biggest question for Bangladesh lies not in trade or aid, but in the Gulf. 

The Iran war that began on February 28 became, for American voters, a question of fuel prices and inflation, and many analysts believe that anger shaped the result. In September, a “war powers” resolution to limit the war failed in the Republican-controlled Senate by a single vote, 49 to 50. 

In the new Senate, such a resolution is more likely to pass, and Democrats are also talking about attaching conditions on war spending to the defence budget. The president can veto it, but in the Qatar-mediated talks now under way, this pressure from Congress could add momentum towards a ceasefire.

This is where Bangladesh’s biggest stake lies. Before the war, spot LNG in Asia cost about $10 per MMBtu; in September it rose again towards $30. More than 40 percent of the country’s electricity comes from imported LNG, fertiliser comes through the Strait of Hormuz, and a large share of remittances comes from the Gulf. 

If any decision in Washington helps end this war even a month sooner, its benefit will be felt in Bangladesh’s factories, irrigation pumps and kitchens far more than any change in American tariffs.

So what should Dhaka do? First, take diplomacy in Washington beyond the White House and the State Department, and reach the relevant committees and members of both parties in Congress. Second, push to finalise the proposed duty-free quota for garments made with American cotton, since it is acceptable to both parties. Third, keep up the pace of domestic reform with one fact in mind: congressional scrutiny of labour rights, factory safety and democratic governance may increase. And fourth, reduce dependence on any single market or single source of energy, because uncertainty in Washington will not ease over the next two years; with the 2028 presidential election ahead, it may well grow.

The US midterm election, then, is neither simple good news nor bad news for Bangladesh. It is a shift in the balance that will put some rein on the White House’s will alone. Tariffs will not fall overnight, and aid will not return overnight. But if this shift can end the war in the Gulf even a little sooner, that will be the greatest gain of this election for Bangladesh.

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***Murad Kibria is a writer and chartered accountant.