Trouble for Muhammed Yunus! India Revokes Key Trade Transit Facility for Bangladesh After Controversial Remarks on Northeast

The decision ends a 2020 arrangement that allowed Bangladesh to trans-ship export cargo through India to third countries, a move seen as a response to recent provocative statements by Bangladesh's interim leadership.

India Revokes Key Trade Transit Facility for Bangladesh After Controversial Remarks on Northeast

India has officially withdrawn a key trans-shipment facility previously granted to Bangladesh, in what appears to be a diplomatic reaction to recent remarks made by Muhammad Yunus, the Chief Adviser of Bangladesh's interim government. Yunus had described India’s northeastern region as “landlocked” and reliant on Bangladesh for maritime access — a statement that sparked backlash in Indian policy circles.

The Central Board of Indirect Taxes and Customs

The Central Board of Indirect Taxes and Customs (CBIC) issued a circular on April 8 rescinding the 2020 notification that enabled Bangladesh to move export cargo via Indian Land Customs Stations to reach third countries through Indian ports and airports. "It has been decided to rescind... circular...dated June 29, 2020, as amended, with immediate effect. Cargo already entered into India may be allowed to exit the Indian territory as per the procedure," the circular read.

The now-cancelled arrangement had facilitated smoother export operations for Bangladesh to Bhutan, Nepal, and Myanmar. It was also seen as a symbol of regional cooperation and logistical efficiency. However, Indian exporters, particularly in the apparel sector, have long opposed the transit facility. The Apparel Export Promotion Council (AEPC) and other trade bodies raised concerns over congestion at cargo terminals and higher freight charges. AEPC Chairman Sudhir Sekhri had earlier noted that 20–30 Bangladeshi trucks entered Delhi daily, disrupting local logistics operations.

Ajay Sahai, Director General of the Federation of Indian Export Organisations (FIEO), welcomed the decision, stating, “Now we will have more air capacity for our cargo.”

Trade experts believe the move will significantly disrupt Bangladesh’s export logistics. “The previous mechanism had offered a streamlined route through India, cutting transit time and cost,” said Ajay Srivastava of the Global Trade Research Initiative. The development comes amid growing global trade frictions, with the U.S. recently imposing tariffs on both India and Bangladesh.

The diplomatic and economic fallout of this decision could reshape regional trade dynamics in South Asia in the coming months.