Tensions between India and Bangladesh have escalated following India’s recent decision to impose trade restrictions on Bangladeshi exports. The move has drawn concern from Bangladesh’s interim government led by Chief Adviser Muhammad Yunus.
India’s Trade Restrictions
In April 2025, India withdrew a key transshipment facility that had previously allowed Bangladeshi exports to third countries via Indian land borders. This decision followed remarks by Muhammad Yunus during a visit to China, where he referred to India’s northeastern states as “landlocked” and emphasized Bangladesh’s strategic position as a gateway to the sea. He also advocated for stronger Chinese economic involvement in the region.
Soon after, India imposed restrictions on the import of several Bangladeshi products, including ready-made garments, processed foods, rubber goods, plastic items, and wooden furniture, particularly affecting border trade with India’s northeastern states.
Bangladesh’s Response
The interim government of Bangladesh expressed concern over these developments, calling for bilateral relations that are based on fairness and mutual respect. Chief Adviser Yunus emphasized that Bangladesh remains committed to strong ties with India but noted that such relationships should be grounded in equitable treatment.
Bangladeshi exporters have warned that the restrictions could lead to increased trade delays, higher transportation costs, and disruptions in supply chains. Economic analysts in Dhaka also noted that these non-tariff barriers may hurt Bangladesh’s export competitiveness, especially in key sectors like textiles.
Impact on Regional Trade
The restrictions are expected to impact both countries economically. Bangladesh’s garment industry—its economic backbone—could face rising logistics costs and delays. On the Indian side, buyers may encounter increased retail prices and slower delivery times due to reduced access to Bangladeshi goods.
These developments could also hinder broader regional trade initiatives aimed at promoting connectivity and economic integration in South Asia.
