In a significant trade policy update, the Directorate General of Foreign Trade (DGFT) has issued a notification restricting the import of select goods from Bangladesh to only specific designated ports. This move primarily affects readymade garments, processed food, and other consumer goods.
While the curbs are unlikely to affect goods transiting from Bangladesh to Nepal or Bhutan, the development is being seen as a strategic recalibration of India’s trade policy with its eastern neighbor.
What the DGFT Notification Says
The DGFT, under the Ministry of Commerce and Industry, issued the directive in mid-May 2025. Key highlights of the order include:
Selective Port Access: Bangladeshi imports such as garments, food items, and other specified products will now be allowed only through notified land customs stations (LCS) and ports.
Exemptions for Transit Trade: Goods moving from Bangladesh to Nepal or Bhutan via India will remain unaffected by this restriction.
No Blanket Ban: This is not a ban on imports from Bangladesh. Rather, it is a logistical and regulatory streamlining move aimed at better monitoring and documentation.
Affected Product Categories
The restrictions target high-volume consumer imports from Bangladesh, especially:
Textiles and Readymade Garments
Processed Food Products
Footwear, Plastic Goods, and Certain FMCG items
This comes at a time when Bangladesh’s exports to India have been growing, especially in low-cost apparel and food categories. India imported over $2 billion worth of goods from Bangladesh in FY24.
Strategic Context: Why Is India Doing This?
While the DGFT notification doesn't state a specific reason, trade experts suggest multiple possible motives:
1. Protecting Domestic MSMEs
By limiting entry points, India could be trying to prevent the flooding of cheap imports into border markets like West Bengal, Assam, and the Northeast — thereby protecting local micro, small, and medium enterprises (MSMEs).
2. Improved Regulatory Oversight
Concentrating the import flow through fewer ports will help customs and border authorities improve quality control, origin verification, and tax compliance.
3. Political & Strategic Signaling
India might also be sending a subtle message amid regional negotiations, especially on trade imbalance issues, border concerns, or transit disputes.
What This Means for Regional Trade
The move maintains a careful diplomatic balance:
Transit Trade to Nepal & Bhutan: Not impacted. India continues to support regional integration and connectivity.
Bilateral Trade with Bangladesh: Could face temporary logistical hurdles, especially for small and medium Bangladeshi exporters who now need to reroute shipments through approved points.
Exporters in Bangladesh may face rising freight costs and clearance delays in the short term.
Market and Business Impact
For Indian Importers:
Importers will need to re-align supply chains, especially those relying on border customs stations like Petrapole, Agartala, or Dawki.
May cause temporary price hikes or supply disruption for garments and low-end consumer goods.
For Indian MSMEs and Traders:
Industry Reaction
Early reactions from Indian trade associations are mixed:
“While regulatory tightening is welcome, we hope the move doesn’t lead to retaliatory restrictions from Bangladesh,” said a Kolkata-based garment importer.
Bangladeshi exporters, particularly SMEs, have expressed concern over rising operational costs and restricted access to the Indian market.
What’s Next?
The DGFT is expected to publish a detailed list of approved ports and product HS codes under the restriction.
Bangladesh’s commerce ministry may seek bilateral talks to understand and respond to the policy shift.
Logistics firms and customs brokers are likely to adjust routing strategies to remain compliant.
Final Thoughts
India’s decision to restrict certain imports from Bangladesh to specific ports reflects a strategic balancing act between trade openness and economic protectionism. While not a hostile measure, it clearly aims to enhance control, reduce regulatory leakages, and protect domestic businesses — all without disrupting critical regional transit corridors.
For businesses on both sides of the border, agility in logistics and compliance will be key to navigating this evolving policy landscape.