New Delhi, Apr 9 (UNI) India said today that the withdrawal of transshipment facility to Bangladesh was due to the pileup of Bangladeshi export goods at Indian airports and ports, which was hindering Indian exports and creating backlogs.
The Ministry of External Affairs spokesperson Randhir Jaiswal, answering a barrage of questions on the issue, said at a briefing today, that the transshipment facility had been extended to Bangladesh in 2020.
“The trans-shipment facility extended to Bangladesh had over a period of time resulted in significant congestion at our Airports and Ports. Logistical delays and higher costs were hindering our own exports and creating backlogs. The facility, therefore, has been withdrawn with effect from April 8, 2025. And let me clarify here, I saw some reports. These measures do not impact Bangladesh's exports to Nepal and Bhutan transiting through Indian territory.”
“It has no impact on Nepal and Bhutan trade as far as Bangladesh exports are concerned…There is a particular reason why it has been brought in because we are facing congestion on our side, and we have to create more space for our own exports.”
His clarification came as the Central Board of Indirect Taxes and Customs (CBIC) issued a circular on April 8, announcing that New Delhi is rescinding the use of the transshipment facility for export via its land routes with immediate effect.
The CBIC circular announced it was rescinding with immediate effect, an earlier circular dated June 29, 2020, that allowed the transshipment of export cargo from Bangladesh to third countries through the Land Customs Stations (LCSs) to Indian ports or airports in containers or closed-bodied trucks.
A significant portion of Bangladesh's exports of readymade garments are routed through Indian airports, particularly Indira Gandhi International Airport in New Delhi.
The Apparel Export Promotion Council (AEPC) of India had been lobbying for the removal of this facility, since both countries are direct rivals in textile exports. Eliminating the facility is seen as a step to ease congestion at Indian airports and support the domestic exporters, according to AEPC Chairman Sudhir Sekhri, who added that disruptions in maritime commerce due to the Red Sea crisis and rampant piracy have prompted exporters to switch from sea to air, further inflating logistics expenses, as per the Dhaka Tribune.
The withdrawal of the facility also comes days after Bangladesh Chief Advisor Mohd Yunus, during his recent Beijing visit, urged China to establish an economic base Bangladesh and insisted that Bangladesh was the "only guardians of the ocean" for the region, especially India’s Northeast.
"The seven states of India…eastern part of India — are called the Seven Sisters. They are a landlocked region of India. They have no way to reach out to the ocean. We are the only guardians of the ocean for this region. So this opens up a huge possibility. So this could be an extension of the Chinese economy…" Yunus said, inviting Chinese investors to Bangladesh.
His statement had been slammed as "offensive, strongly condemnable and provocative” by many Indian leaders including Assam Chief Minister Himanta Biswa Sarma.
PM Modi, during his meeting with Mohd Yunus in Bangkok, on the sidelines of the BIMSTEC Summit, had urged Bangladesh to avoid anti-India rhetoric.
UNI RN