India blocks port imports and put restrictions on the import of several Bangladeshi products, hugely impacting India-Bangladesh trade. It is carried out because Bangladesh launched new trade policies limiting Indian exports via land routes. The new policy will limit the entry of readymade garments, processed food, plastic products, and wooden furniture via land ports and permit them only via certain seaports.

India Blocks Port Imports

As per the Directorate General of Foreign Trade (DGFT), the following products of Bangladesh will be prohibited entry via land customs stations (LCSs). Also integrated check posts (ICPs) in the state of Assam, Meghalaya, Tripura, Mizoram, and West Bengal:

Readymade garments

Fruit-flavored and carbonated beverages

Processed foods (baked foods, snacks, chips, confectionery)

Cotton and cotton yarn waste

PVC and plastic finished products

Dyes, plasticizers, and granules

Wooden furniture

But these restrictions will not apply to even essential items such as fish, LPG, edible oil, and crushed stone.

Why Has India Imposed These Restrictions?

The action follows Bangladesh’s recent trade measures, when imports of Indian yarn were curbed through land ports and permitted only through seaports. India has reciprocally imposed similar curbs on Bangladeshi goods. Authorities have declared Bangladesh cannot choose and discriminate in trade terms to its convenience while curtailing Indian exports.

In addition, diplomatic ties were also increased following the provocative remarks by Bangladesh’s interim government head, Muhammad Yunus, in China that India’s northeastern states are landlocked and depend on Bangladesh for access to the sea. The comments were received negatively in New Delhi, leading to further trade policy adjustments.

Impact on Trade and Economy

Bangladesh earns over $700 million of readymade garments from India annually. Bangladeshi exporters will now have to bear increased logistic expenses as they will be forced to send shipments through Kolkata and Nhava Sheva seaports instead of land ports. The move will have its implications on supply chains. Also targeting big brands that place orders for garments from Bangladesh like Zara, H&M, and UNIQLO.

India’s action to prohibit some Bangladeshi imports across land ports is a massive shift in the trade between the two countries. Although the step has been viewed as a retaliatory action, it could lead to negotiation or realignment of trade in the coming months. While both nations adjust to these modifications, exporters and companies will be compelled to integrate new trade routes and practices.

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