India’s Import Curbs on Jute Products from Bangladesh

• India has imposed immediate restrictions on the import of jute and allied fibre products from Bangladesh.

• These apply at all Indian land and seaports except Nhava Sheva in Maharashtra.

• The restrictions do not apply to Bangladeshi exports destined for Nepal and Bhutan, but re-export from these countries into India is prohibited.

Background & Reasons:

• Bangladesh currently enjoys duty-free access to the Indian market under the South Asian Free Trade Area (SAFTA) agreement.

  The Indian jute industry has raised concerns about:

  • Dumped and subsidised imports from Bangladesh (jute yarn, fibre, fabrics, bags).

  • Unfair trade practices like mislabelling, misuse of exemptions, and routing through firms exempt from anti-dumping duties (ADD).

  Previous anti-dumping duties (ADD) imposed by India have failed to reduce import volumes significantly.

• India has repeatedly raised concerns with Bangladesh but reports only nominal adjustments have been made.

  Jute is a critical industry in India, employing around 400,000 workers and supporting farmers in states like West Bengal, Bihar, Assam, Odisha, Andhra Pradesh, Tripura, and Meghalaya.

Impact of Land Port Closures

On India:

• Helps protect domestic jute farmers and mill workers from unfair competition.

  Aims to stop the underutilization of Indian jute mills and reduce unemployment caused by cheap imports.

  Reinforces India’s push for self-reliance and economic protection in rural sectors.

On Bangladesh:

• Limits Bangladeshi exporters’ access to key Indian markets via land routes, pressuring exporters to shift to costlier seaports like Nhava Sheva.

• May affect Bangladesh’s export volumes and trade revenues, especially for small-scale jute exporters relying on land routes.

On the Region:

• Restrictions do not affect Bangladesh’s exports to Nepal and Bhutan.

• However, re-export of Bangladeshi jute products from Nepal and Bhutan into India is banned, closing potential loopholes.

• The move may strain bilateral trade ties and affect regional economic integration under South Asian trade agreements.

India Bangladesh relations

Historical Context: The relationship is rooted in a shared history, with India playing a pivotal role in Bangladesh's 1971 Liberation War. India’s support for Bangladesh’s independence against Pakistan has been a defining moment in bilateral ties

In recent years, relations have improved significantly. The 2015 Land Boundary Agreement (LBA) resolved long-standing border issues, and both countries have moved towards deeper cooperation in regional and global forums

Bilateral Trade:

• India is Bangladesh’s largest trade partner in South Asia, and Bangladesh is India’s second-largest trade partner in Asia after China. The total trade volume of USD 12.9 billion in FY 2023-24 reflects the strong commercial relationship.

  Exports from India to Bangladesh include key items like cotton, petroleum products, engineering goods, and chemicals. These sectors are crucial for both countries as Bangladesh’s textile industry relies on Indian cotton, and energy products are essential for Bangladesh’s growing energy needs.

  Imports from Bangladesh to India primarily include textiles, apparel, jute products, and aerospace parts. Bangladesh’s textiles and jute products hold great value in global markets, and India is a key market for these goods.

  Energy and Connectivity

• Energy Cooperation:

  • The India-Bangladesh Friendship Pipeline (IBFPL) is a monumental development in cross-border energy cooperation. It marks the first energy pipeline connecting the two countries, primarily focused on transporting High-Speed Diesel (HSD) to Bangladesh. The pipeline's capacity of 1 Million Metric Ton Per Annum (MMTPA) plays a pivotal role in supporting Bangladesh’s growing energy demands, particularly in the transportation sector.

    Maitree Super Thermal Power Project: This joint venture between National Thermal Power Corporation (NTPC) and Bangladesh Power Development Board (BPDB) has made significant strides in enhancing Bangladesh's power generation capacity. The power plant now feeds electricity into the Bangladesh grid, demonstrating the depth of India’s cooperation with Bangladesh in the energy sector.

• Water Sharing and River Management

• Teesta River: The Teesta water-sharing issue has been a longstanding point of tension. Bangladesh depends heavily on the Teesta for irrigation, but disputes over the fair distribution of water have created friction.

  Ganges Water Treaty: The 1996 Ganges Water Treaty between India and Bangladesh has been a success and a model of cooperation. It regulates the sharing of the river’s waters during the dry season, providing equitable distribution between the two countries.

  Other Rivers: India and Bangladesh share about 54 transboundary rivers, and managing their water resources continues to be an ongoing dialogue between the two countries.

Defence Cooperation

• Joint Military Exercises:

  • Exercise Sampriti (Army): This is a series of joint military training exercises between the Indian and Bangladeshi armies aimed at enhancing interoperability and understanding between the two armed forces. It focuses on counter-terrorism operations, peacekeeping missions, and humanitarian assistance.

  • Exercise Bongosagar (Navy): A bilateral naval exercise aimed at strengthening maritime security and improving cooperation between the two navies. This includes joint drills, maritime patrols, and exchange of expertise in countering piracy, maritime terrorism, and other naval challenges.

  • Coordinated Patrol (CORPAT) (Navy): India and Bangladesh conduct regular Coordinated Patrols in the Bay of Bengal to secure the maritime borders and enhance cooperation on maritime security, particularly in preventing illegal activities like human trafficking, drug smuggling, and piracy.

Connectivity Infrastructure Projects:

• Akhaura-Agartala Rail Link: This cross-border rail project aims to improve transportation between the two countries, facilitating the movement of goods and passengers.

• Khulna-Mongla Port Rail Line: This project is crucial for improving trade flow through the Mongla Port in Bangladesh, linking it to India via the rail network.

• Maitri Setu: A bridge over the Feni River, linking India’s Tripura state with Bangladesh, provides better connectivity and trade routes for both countries, reducing transportation costs and improving trade efficiency.

Multilateral Cooperation

• Regional Cooperation:

  • South Asian Association for Regional Cooperation (SAARC): India and Bangladesh have been key players in SAARC, where they collaborate on issues such as regional integration, poverty alleviation, and combating terrorism.

  • BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation): Both countries are vital members of this regional organization, which focuses on promoting economic cooperation and regional integration in sectors like trade, energy, transportation, and environmental sustainability.

  • Indian Ocean Rim Association (IORA): India and Bangladesh cooperate in the Indian Ocean Rim Association to promote peace, security, and cooperation across the Indian Ocean region, which is vital for both countries' economic interests, particularly in trade and maritime security.

Challenges in India-Bangladesh Relations

Diplomatic Disconnect

• Overreliance on Sheikh Hasina: India’s close alignment with Prime Minister Sheikh Hasina and the Awami League has led to limited engagement with other political stakeholders, including the opposition (BNP) and civil society.

  Post-Hasina Uncertainty: India lacks institutional depth in its outreach beyond Hasina’s government, raising concerns about a strategic vacuum in a post-Hasina political landscape.

  Perceptions of Interference: India’s past decisions (e.g., hosting Sheikh Hasina during exile) have been interpreted by some in Bangladesh as interference in domestic affairs, fueling distrust among political factions.

Growing Chinese Influence

• Strategic Engagement: Bangladesh is an active participant in China's Belt and Road Initiative (BRI) and is receiving massive investments in:

  • Infrastructure: Ports (e.g., Payra), energy grids, roads, and telecom.

    Water Management: China’s involvement in the Teesta River Restoration Project, long a sensitive India-Bangladesh issue, signals growing influence.

  Geopolitical Implication: This increasing Chinese footprint in Bangladesh’s strategic sectors is viewed by India as a challenge to its traditional influence, creating a new layer of competition in South Asia.

Border Management & Illegal Migration

• Illegal Immigration: Long-standing concerns in India’s northeastern states over undocumented migration from Bangladesh, often blamed for:

  • Altering local demographics

  • Fueling political and ethnic tensions

  Rohingya Refugee Crisis: India remains cautious about large-scale migration of Rohingya Muslims from Bangladesh, which adds pressure on border management and security concerns.

  Insurgency & Trafficking:

  • Cross-border movement of insurgent groups (e.g., ULFA camps) remains a concern.

  • Persistent issues of drug trafficking, arms smuggling, and human trafficking across porous borders.

Rise of Anti-India Sentiment

• Public Perception: Despite strong government-to-government ties, there’s growing mistrust at the societal level:

  • Accusations of India’s political interference

  • Water-sharing disputes (especially Teesta)