Guwahati: India has imposed restrictions on imports of ready-made garments (RMG) and other goods from Bangladesh, signaling a move towards reciprocal trade relations, sources familiar with the matter revealed on Sunday.
The decision comes in response to trade restrictions allegedly adopted by Dhaka.
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New Delhi has limited RMG imports from Bangladesh to the ports of Kolkata and Nhava Sheva and has also barred the import of a range of consumer goods through 13 land border posts in the northeast and West Bengal.
This action follows concerns raised by Indian officials regarding Bangladesh’s trade practices.
Sources indicated that Bangladesh’s restrictions on Indian yarn and rice, as well as their selective intensification of inspections on all Indian exports, directly caused India’s move.
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The restriction on RMG imports is anticipated to significantly impact Bangladesh because its annual exports of these items to India are valued at approximately $700 million.
“Bangladesh needs to realise that it cannot cherry-pick terms of bilateral trade solely for its benefit, or assume the northeastern states are a captive market for its exports, while denying the region market access and transit,” a source stated anonymously.
According to sources, the Directorate General of Foreign Trade formalized the restrictions on land port imports from Bangladesh to the northeastern states through a notification on Saturday.
While India had previously permitted all exports from Bangladesh without limitations, Bangladesh had reportedly restricted transit and market access to India’s northeastern states.
The latest measures by India aim to “restore equal market access for both countries,” particularly given Bangladesh’s repeated calls for equitable engagement with India, the source added.
The restriction of RMG imports to the Kolkata and Nhava Sheva sea ports is a direct response to Bangladesh’s alleged trade barriers on Indian yarn and rice, and its heightened inspection regime on Indian exports, sources clarified.
They asserted that the future trade relationship with Bangladesh will be based on reciprocal terms.
Amidst recent comments by Bangladesh’s interim government chief, Muhammad Yunus, highlighting the landlocked status of India’s northeastern states during a visit to China, sources pointed out Prime Minister Narendra Modi’s consistent emphasis on the integral role of these seven states within the Bimstec grouping.
Meanwhile, Bangladesh’s de facto commerce minister, Sheikh Bashir Uddin, addressed reporters in Dhaka on Sunday, stating that trade with India will continue in the interest of consumers and businesses in both nations.
“We have not yet received any official communication from the Indian side. Once we do, we will take appropriate steps. If any issues arise, both sides will work to resolve them through discussions,” Bashir Uddin said regarding India’s import restrictions.
He noted that the Bangladeshi side had primarily learned about the matter through social media and media reports.
A large portion of our exports comes from the garment sector. Our main focus remains on achieving competitiveness. Trade is beneficial to both countries. India has a strong textile industry, yet it imports our products based on our capabilities,” he added.