India Halts Transshipment Route for Bangladeshi Exports Amid Tensions

India has stopped allowing Bangladeshi export transshipments through its land borders to third countries, citing delays and costs. This move, combined with high U.S. tariffs, challenges Bangladesh's export efforts, especially in readymade garments. Experts warn it could strain relations and violate WTO rules, impacting regional trade dynamics.

In a surprising shift in regional trade dynamics, India has rescinded a crucial transshipment facility for Bangladeshi exports, citing logistical delays and increased costs. This decision is expected to intensify the economic challenges for Dhaka, which is already confronting significant U.S. tariffs on its goods.

The repeal, announced by India's customs department, halts the 2020 arrangement that permitted Bangladesh to move goods through India's land customs stations to international ports. This development is anticipated to disrupt exports, particularly affecting trade with Nepal, Bhutan, and Myanmar, and may impact Bangladesh's crucial readymade garment sector.

Economic experts and industry leaders express concerns over the potential breach of World Trade Organisation regulations and warn that this move could further dampen bilateral relations. The strained ties follow political tensions, exacerbated by Bangladesh Prime Minister Sheikh Hasina's departure during protests, further complicating the economic landscape.

(With inputs from agencies.)