Context: Indian government has terminated the transshipment facility that allowed export cargo from Bangladesh to third countries via Indian Land Customs Stations, en route to Indian ports and airports.
🇮🇳🇧🇩 India–Bangladesh Transshipment Facility
📦 Overview of the Arrangement
The transshipment facility was initiated in 2020.
It allowed Bangladeshi cargo to:
Transit through Indian territory
Be shipped from Indian ports or airports
Reach third countries such as Bhutan, Nepal, and Myanmar
📉 Benefits for Bangladesh
Enabled smoother trade flows and cost-effective logistics.
Especially beneficial for Bangladesh’s readymade garment sector, a key export industry.
Reduced dependency on limited domestic ports and infrastructure.
🤝 India’s Strategic Gesture
The facility was a goodwill move under India’s Neighbourhood First Policy.
Aimed to strengthen regional trade integration and enhance bilateral ties.
⚠️ Why Was the Transshipment Facility Withdrawn?
🧭 Strategic Concerns
Bangladesh’s support for expanding China’s economic presence in India’s strategically sensitive Northeast raised geopolitical concerns in New Delhi.
🚢 Operational Challenges
India cited significant congestion at its ports and airports due to the transshipment arrangement.
The congestion led to:
Logistical delays
Increased export costs for Indian businesses
Significance of the Move
⚖️ India’s Balancing Act
The decision is viewed as a strategic balancing act by India.
Aims to maintain regional cooperation while:
Protecting internal logistical efficiency
Responding to growing Chinese influence in South Asia, particularly in India’s Northeast region.
🌐 Impacts on India–Bangladesh Relations
The move may strain bilateral ties, which are already delicate.
Comes at a time when Bangladesh is deepening economic and strategic ties with China.
Signals India’s increasing assertiveness in response to geopolitical shifts.
🚚 Boost to India’s Logistics Sector
The suspension may lead to greater efficiency in India’s own logistics and export systems.
Key transport hubs, such as Indira Gandhi International Airport (New Delhi), which previously handled significant volumes of Bangladeshi air cargo, are likely to experience reduced congestion.
Could contribute to streamlined cargo operations and reduced delays for Indian exporters.