Desk Report,
India-Bangladesh economic relations are in a worrying trend
The use of non-tariff barriers in trade between India and Bangladesh is increasing. A worrying trend is underway for the two countries with the closest economic ties in South Asia. Recently, India decided to allow four types of jute products exported from Bangladesh to enter only Mumbai’s Navoseba port instead of importing them through land ports.
India-Bangladesh economic relations are in a worrying trend
This will have a major impact on the flow of trade between the two countries. Because currently, more than 99 percent of Bangladesh’s jute exports go to India via land routes. These new restrictions will not only increase costs, but also create major logistical complications for Bangladeshi exporters. Although India may present these decisions as a pretext for regulations or quality control. But the sudden application and repetition of these restrictions raise doubts about a strategic objective.
However, it is not only India, Bangladesh is also walking the same path. Since late 2024, Bangladesh has imposed restrictions on the import of Indian yarn and some products through land ports. Bangladesh has recently decided to close three land ports on the border with India. The reasons given for this are lack of infrastructure and limited trade activities. These steps can be seen as part of the ongoing trade tensions and regulatory trends between the two countries. All these indicate a kind of conservative economic policy, which disrupts mutual trust and stable bilateral trade.
The most worrying thing is that India and Bangladesh, known as close partners for so long, are now turning to unilateral sanctions and non-tariff barriers instead of transparent dialogue to resolve trade issues. These steps are not only hurting bilateral trade (where India exports disproportionately more goods than Bangladesh. India exports about $12 billion worth of goods to Bangladesh annually, while Bangladesh exports only about $2 billion to India), but they are also destroying the potential for greater regional economic integration in South Asia. At a time of increasing uncertainty in global trade and geopolitical tensions, South Asian countries need to increase mutual cooperation. Along with this, they should not adopt protectionist policies. These disrupt supply chains and hinder industrial development.
The most urgent issue now is to initiate a sustained dialogue between India and Bangladesh, free from short-term political calculations. Trade should be seen as a means of mutual economic tolerance, not a tool for coercion. Both governments should prioritize structured negotiations, find ways to resolve disputes over non-tariff barriers, and create institutional platforms to facilitate private sector participation. Political differences should not overshadow the benefits of broader economic cooperation. The future stability and prosperity of South Asia depend on this cooperation.
