India Limits Bangladeshi Garment Imports via Land Ports in Trade Policy Shift
| 2025-05-18
India restricted Bangladeshi exports via land ports over trade reciprocity concerns.
India restricts Bangladeshi ready-made garment imports through land ports, citing trade reciprocity and regional economic balance amid rising bilateral tensions.
India has moved to restrict the entry of ready-made garments and various consumer goods from Bangladesh through land ports, citing the need for reciprocal trade terms and balanced access to regional markets.
According to government sources, the new policy limits Bangladeshi exports of garments, plastic items, wooden furniture, processed food, cotton waste, and soft drinks to India via only two sea ports—Kolkata and Nhava Sheva—while prohibiting their entry through multiple land customs stations in the northeastern states of Assam, Meghalaya, Tripura, and Mizoram, as well as parts of West Bengal.
Trade retaliation over market restrictions
Officials familiar with the decision said it follows what India views as restrictive trade measures imposed by Bangladesh, particularly on Indian exports such as yarn and rice. The Indian government said it aims to enforce fair trade practices between the two nations, asserting that bilateral trade should be governed by equal and reciprocal terms.
“Restricting imports of ready-made garments from Bangladesh through only two seaports is a reciprocal measure to Bangladesh imposing similar trade restrictions on Indian yarn and rice,” a government source told the press.
The changes come roughly five weeks after India withdrew a longstanding arrangement that allowed Bangladeshi export cargo to transit through Indian airports and seaports en route to third countries.
Impact on Bangladesh’s garment sector
The restriction is expected to significantly affect Bangladesh’s export earnings from India, particularly in the ready-made garments (RMG) sector. Bangladesh, one of the world’s largest garment exporters, recorded RMG exports worth approximately USD 38 billion in 2023. Of that, around USD 700 million worth was exported to India, with more than 90 percent entering through land ports.
With the land route now closed to garment exports, exporters in Bangladesh will need to shift to maritime channels, potentially increasing costs and transit times.
Northeast India no longer a 'captive market'
Government officials indicated that the move is partly intended to end what they described as Bangladesh’s assumption that India’s Northeast is an automatic or “captive” market for its exports. They added that India had provided open access for Bangladeshi goods through all land ports, while Bangladesh had not extended similar privileges for Indian goods at its own border posts.
“Bangladesh needs to realise that it cannot cherry-pick terms of bilateral trade solely for its benefit or assume the Northeast is a captive market for its exports, while denying it market access and transit,” another official source said.
Boost for local industry in Northeast India
India views the policy change as an opportunity to strengthen manufacturing and local entrepreneurship in its Northeast region, which shares a long border with Bangladesh and is seen as a vital component of India’s regional and economic strategy.
“The equal market space now available in the resource-rich Northeast is expected to give a fillip to manufacturing and entrepreneurship in the region under the Atmanirbhar Bharat schemes and policies,” the same official noted, referring to India's broader self-reliance initiative.
BIMSTEC and regional trade dynamics
The Northeast is a strategically significant region within the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), a regional grouping that includes India, Bangladesh, Bhutan, Myanmar, Nepal, Sri Lanka and Thailand. Prime Minister Narendra Modi has previously emphasised the central role of the Northeast in India’s Act East policy and BIMSTEC cooperation.
There are currently 11 operational land transit points between India and Bangladesh in the Northeast—three in Assam, two in Meghalaya, and six in Tripura. Historically, India has permitted Bangladeshi exports through all of them. However, Indian officials have long expressed concerns about Bangladesh maintaining restrictive inspection and access procedures at its corresponding ports of entry for Indian goods.
The latest measures by India suggest a shift towards a more assertive trade posture in the region, aimed at rebalancing a relationship that officials say has leaned disproportionately in Bangladesh’s favour.
While there has been no official response from Dhaka as of Sunday evening, the development may prompt diplomatic engagement between the two neighbours to address the growing concerns over mutual market access and trade equity.
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