What happened?
On 8 April 2025, the Indian government revoked a trans-shipment facility that allowed Bangladesh to export goods to third countries—such as Bhutan, Nepal, and Myanmar—via Indian land customs stations en route to Indian ports and airports. The facility, granted in June 2020, was withdrawn through a circular issued by the Central Board of Indirect Taxes and Customs.
Indian apparel exporters had long demanded the withdrawal, citing congestion at air cargo terminals, increased freight costs, and reduced cargo space at key hubs like Delhi’s IGI Airport. The decision follows growing concerns from Indian exporters about competitiveness, especially in the textile sector where Bangladesh is a major rival.
Why it matters to India
The move is expected to boost Indian export sectors like garments, footwear, and gems by easing logistical bottlenecks and improving access to air freight capacity. However, it may strain Bangladesh’s export logistics and impact landlocked countries like Nepal and Bhutan that relied on the route.
Trade experts warn the decision could challenge regional trade dynamics and test compliance with WTO transit obligations, which require member states to facilitate unhindered trade for landlocked nations.