NEW DELHI (Diya TV) — India has revoked a critical transshipment facility that allowed Bangladeshi exports to pass through its territory, a decision that comes amid souring diplomatic ties and controversial remarks from the head of Bangladesh’s interim government.
The move, announced in an April 8 circular by India’s Central Board of Indirect Taxes and Customs (CBIC), rescinds a 2020 order that permitted Bangladesh to move export cargo to third countries through Indian Land Customs Stations and onward to Indian ports and airports. The facility had enabled easier trade access for Bangladesh to countries like Nepal, Bhutan, and Myanmar.
“It has been decided to rescind… circular…dated June 29, 2020, as amended with immediate effect,” the CBIC said. “Cargo already entered into India may be allowed to exit the Indian territory as per the procedure.”
India’s Ministry of External Affairs cited “delays and higher costs” that were disrupting Indian exports and leading to backlogs at logistics terminals. But the timing of the decision has drawn attention, coming just days after Bangladesh’s interim leader Muhammad Yunus made inflammatory remarks about India’s Northeast.
Speaking during a visit to Beijing, Yunus described the region — home to India’s so-called “Seven Sister” states — as “landlocked” and dependent on Bangladesh for maritime access. “We are the only guardians of the ocean for all this region,” Yunus said, adding, “This could be an extension of the Chinese economy… bring things to China, bring it out to the whole rest of the world.”
His comments triggered a sharp diplomatic response from India. External Affairs Minister S. Jaishankar pushed back, stressing India’s connectivity and maritime strengths. “We have the longest coastline in the Bay of Bengal… Our North-Eastern region is emerging as a connectivity hub for BIMSTEC,” he said, referring to the regional economic bloc.
Trade experts warn that India’s decision to revoke the transshipment deal will significantly affect Bangladesh’s logistics and trade flows — particularly its ready-made garment sector, which forms a vital part of its export economy.
“The previous mechanism had offered a streamlined route through India, cutting transit time and cost,” Ajay Srivastava, founder of the Global Trade Research Initiative, told the Press Trust of India. “Now, without it, Bangladeshi exporters may face delays, higher costs and uncertainty.”
Exporters within India had expressed frustration over the arrangement. Apparel Export Promotion Council Chairman Sudhir Sekhri said the daily influx of Bangladeshi trucks — 20 to 30 arriving in Delhi alone — contributed to congestion at cargo terminals and pushed up freight prices. Ajay Sahai, Director General of the Federation of Indian Export Organizations, noted that the change will free up capacity. “Now we will have more air capacity for our cargo,” Sahai said.
The development reflects broader geopolitical tensions in South Asia as regional players vie for influence. Yunus’ comments appeared to signal Dhaka’s openness to deeper engagement with Beijing — a shift that hasn’t gone unnoticed in New Delhi.
The diplomatic chill follows a year of political turbulence in Bangladesh. Prime Minister Sheikh Hasina sought refuge in India last August amid mass protests, while Yunus has since taken a more assertive foreign policy line, expressing interest in cooperating with China and Pakistan.
With both India and Bangladesh being members of the World Trade Organization, experts say the move may also raise questions under international transit rules, especially regarding the rights of other landlocked countries like Nepal and Bhutan.
