Bangladesh’s key exports to India, including readymade garments (RMG), are set to face significant disruptions following India’s sudden ban on the import of seven categories of Bangladeshi goods via land ports. The restrictions, which came into effect on Saturday, compel exporters to rely on longer, costlier maritime routes, raising concerns over trade stability and economic relations.
India’s move, part of a broader response to Bangladesh’s earlier decision to ban yarn imports from India via land ports, restricts imports of RMG and other consumer goods through 13 land border posts in West Bengal and the northeastern states. Indian authorities now only permit RMG imports through Kolkata and the Nhava Sheva port in Mumbai, while other consumer goods are barred from land crossings.
Bangladesh’s RMG sector, a vital pillar of its economy, exports approximately US $ 700 million worth of garments annually to India. According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), during the current fiscal year, RMG exports to India have already reached US $ 563 million in the first 10 months alone, with 93 per cent shipped via land ports. The disruption is expected to force exporters to reroute shipments through Kolkata and Mumbai, increasing transit times and costs.
Trade officials and industry leaders expressed concern that the restrictions will impact bilateral trade balances and strain economic ties. BGMEA Administrator Anwar Hossain emphasised the importance of land ports for smooth trade flows and called for bilateral talks to find solutions.
Bangladesh’s total annual trade with India is around US $ 13 billion, with exports of about US $ 2 billion. The latest restrictions threaten to destabilise this trade relationship further, amid ongoing trade tensions that have seen Bangladesh impose restrictions on Indian yarn and rice imports and increase inspections on Indian exports.
Indian officials justify the restrictions as an attempt to restore “equity” in trade and access to the northeastern markets, which Bangladesh has historically limited in terms of transit and market access. Some analysts see the move as a reciprocal response to Bangladesh’s measures, with Indian authorities aiming to balance trade and assert sovereignty over border trade channels.
Bangladesh’s interim Commerce Minister Sheikh Bashir Uddin stated that trade would continue in the interest of both nations’ consumers and businesses, adding that discussions would be held if issues arise. He highlighted Bangladesh’s competitive garment sector and its ongoing cooperation with India despite the restrictions.
As both countries navigate this trade standoff, industry stakeholders and policymakers are urging dialogue to mitigate the impact on Bangladesh’s exports and maintain healthy economic relations.
