New Delhi, Apr 9 (KNN) The Indian government has terminated a key transshipment facility that allowed export cargo from Bangladesh to reach third countries via Indian land customs stations and ports.

The move was announced through a circular issued by the Central Board of Indirect Taxes and Customs (CBIC) on Tuesday.

Originally granted in June 2020, the facility had enabled Bangladesh to send goods, particularly to landlocked countries like Nepal and Bhutan, through Indian routes.

However, it has now been rescinded with immediate effect. Cargo already in transit will be allowed to exit the country under the old guidelines.

The decision comes amid rising global trade tensions, including new U.S. tariffs affecting both India and Bangladesh.

Indian exporters, especially in the apparel sector, had previously urged the government to end the facility, citing congestion and rising air freight costs at major ports like Delhi’s IGI Airport.

Ajay Sahai, Director General of the Federation of Indian Export Organisations (FIEO), welcomed the move, noting it would free up space for Indian exporters.

Apparel Export Promotion Council (AEPC) Chairman Sudhir Sekhri said that transshipment from Bangladesh had caused delays and made Indian exports uncompetitive.

Trade analysts caution, however, that the decision could disrupt logistics for Bangladesh and its trade partners. Ajay Srivastava of the Global Trade Research Initiative (GTRI) highlighted concerns over increased transit times and costs.

He also warned that Nepal and Bhutan may face challenges accessing Bangladeshi goods, potentially violating World Trade Organisation (WTO) transit rules.

As both India and Bangladesh are WTO members, the move is expected to spark further diplomatic and trade discussions in the region.

(KNN Bureau)