India has restricted the import of at least seven categories of Bangladeshi goods, including readymade garments, fruits and processed foods, through its land ports – just a month after Bangladesh banned yarn imports via the same route.
The ban, outlined in a 17 May notification from India's Directorate General of Foreign Trade under the Ministry of Commerce, stipulates that garments from Bangladesh may now only enter India through Kolkata and Nhava Sheva, Mumbai, seaports.
"All readymade garment imports from Bangladesh shall not be allowed from any land port, however, it is only through Nhava Sheva and Kolkata seaports," reads the circular.
The restrictions will not apply to Bangladeshi goods transiting through India but destined for Nepal and Bhutan, it added.
Other items included in the restriction are fruit, fruit-flavoured and carbonated beverages, processed food products, cotton and cotton yarn waste, finished plastic and PVC goods, and wooden furniture.
Imports of these goods have also been barred from entering India via any land customs station or Integrated Check Post (ICP) in Assam, Meghalaya, Tripura and Mizoram.
While India's order does not cite Bangladesh's yarn ban as the reason, many Bangladeshi exporters believe the move is retaliatory.
"We see this as a reciprocal response to Bangladesh's recent restrictions on land-port yarn imports," said Shams Mahmud, a leading garment exporter, told The Business Standard.
He noted that the shift to seaports will increase costs and affect timely delivery, particularly for small exporters. "We supply to several Indian retail outlets. Increased lead times will hurt smaller players in particular."
Mahmud, however, added that since Bangladesh did not restrict Indian imports through seaports, India is unlikely to block Bangladeshi goods via sea either.
Bangladesh's ban on yarn imports through land ports came into effect on 15 April, following lobbying by the Bangladesh Textile Mills Association, alleging that yarn importers were abusing land-port access to under-declared shipments, harming domestic textile mills.
While local spinners welcomed the move, apparel manufacturers opposed it, saying it would raise production costs.
According to National Board of Revenue officials, about three-fourths of yarn imports from India already come via seaports.
Bangladesh imported around $9 billion worth of goods from India in FY24, according to Bangladesh Bank data. In contrast, exports to India during the same period stood at $1.56 billion, as per the Export Promotion Bureau.
Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association, believes the restriction is unlikely to cause significant harm to Bangladesh's garment exports.
However, he fears exports of processed food and other items may take a hit.
"This kind of reciprocal action hurts bilateral trade on both sides," he said. "But India stands to lose more, as Bangladesh imports far more from them."
He added that such issues should be resolved through dialogue, not by trade barriers.
Kamruzzaman Kamal, director at Pran-RFL Group, told The Business Standard that India is a major market for Pran-RFL Group's processed foods, plastic products, furniture, and PVC-finished goods.
"We have made substantial investments in India to serve this market. If India imposes restrictions on the entry of these products, it would be a significant setback for our exports," he said.
"Such restrictions would not only impact Pran-RFL, but also pose serious challenges for other businesses. We hope that both governments will resolve the issue through dialogue and keep the trade routes open," he added.
On 9 April, India withdrew the transhipment facility it had granted to Bangladesh for exporting various items to the Middle East, Europe and various other countries except Nepal and Bhutan.
According to NDTV, it was announced against the backdrop of the statement made by Bangladesh's interim government Chief Adviser Muhammad Yunus in China recently that India's seven northeastern states, which share a nearly 1,600 km border with Bangladesh, are landlocked and have no way to reach the ocean except through his country.
The comment did not go down well in New Delhi and also drew sharp reactions from political leaders in India across party lines, according to NDTV.
Indian exporters, mainly from the apparel sector, had also earlier urged the government to withdraw this facility to the neighbouring country, the official added.
www.facebook.com
