New Delhi, April 9, 2025 – India has formally withdrawn a key transshipment facility that allowed Bangladeshi exports to pass through Indian land customs stations en route to third countries, a move that could significantly impact Dhaka’s trade logistics. However, the Indian government clarified that the decision does not affect Bangladesh’s exports to Nepal or Bhutan that transit through Indian territory.
The Ministry of External Affairs (MEA) said on Wednesday that the transshipment facility, which had been in place since June 2020, was creating congestion at Indian ports and airports, leading to delays, rising logistical costs, and backlogs that ultimately impacted India’s own export efficiency.
“The facility, therefore, has been withdrawn with effect from April 8, 2025,” the MEA stated. “To clarify, these measures do not impact Bangladesh exports to Nepal or Bhutan transiting through Indian territory.”
The Central Board of Indirect Taxes and Customs (CBIC) issued the formal circular on Tuesday, announcing the immediate suspension of the service. The directive permits Bangladeshi goods already in transit to complete their journey under the previous procedures, but prohibits any new consignments under the now-defunct transshipment scheme.
The facility had enabled Bangladesh to move cargo to third countries—including Nepal, Bhutan, and Myanmar—via India’s land, sea, and air transport routes, streamlining regional trade and reducing dependency on slower maritime links.
While the MEA sought to downplay concerns by emphasizing that trade with Nepal and Bhutan would remain unaffected, analysts and exporters in Bangladesh have expressed concern over the broader implications of the move. Many of Bangladesh’s trade routes to landlocked neighbors and other third-party destinations rely heavily on India’s infrastructure.
An Indian Express report citing the CBIC circular said the decision may disrupt Bangladeshi export and import operations, especially given the lack of alternative routes with equivalent capacity and efficiency.
The development comes amid a broader recalibration of India’s trade facilitation policies in response to rising domestic logistical pressures and a renewed push to streamline its own export competitiveness.
Diplomatic observers say the move could prompt new negotiations between Dhaka and New Delhi over trade facilitation and regional connectivity, especially as both nations seek to maintain strong economic ties amid shifting regional dynamics.
