Abdur Razzak was handed over during a "flag meeting" of troops from the nations in the Myanmar border township of Maungdaw, a Bangladesh Border Guard spokesman said.
"Razzak was handed over to our representative team this afternoon. His belongings (including) uniform, submachine gun, ammunition etc have also been returned," Major Abu Russell Siddiki told AFP.
BGB officials have said the Myanmar Border Guard Police held Razzak during the shoot-out on June 17 on the Naf river, which divides the two countries.
A Bangladeshi border guard was also wounded during the firing which a BGB director said was "the outcome of a total misunderstanding".
But tensions rose after photos of a handcuffed Razzak were circulated on social media in Bangladesh, drawing sharp reactions from civilians.
People smuggling is rife in Bangladesh's Cox's Bazar district, which borders Myanmar, and many former fishermen have joined smuggling rings because they are so lucrative.
The crisis followed a Thai crackdown on people smuggling that threw the multi-million dollar industry into disarray, leading gangmasters to abandon their victims on land and at sea.
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