India scraps transshipment facility for Bangladesh's export cargo
India has withdrawn the transshipment facility extended to Bangladesh for sending its export cargoes to other countries through Indian territory
- NEW DELHI — India has withdrawn the transshipment facility extended to
Bangladesh for sending its export cargoes to other countries through Indian
territory.
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- A circular issued by the Central Board of Indirect Taxes
and Customs' (CBIC), dated April 8, states that it has been decided to rescind
the circular dated June 29, 2020, which allowed such transshipments, with
immediate effect. However, cargo that has already entered into India may be
allowed to exit Indian territory, as per the procedure given in the earlier
circular.
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- The 2020 circular had permitted the transshipment of
export cargo from Bangladesh to third countries using Indian Land Customs
Stations en route to Indian ports and airports, to enable smooth trade flows
for Bangladesh’s exports to countries such as Bhutan, Nepal, and Myanmar.
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- Indian apparel exporters had earlier urged the government
to withdraw this facility to the neighbouring country as it is a fierce
competitor in the textile sector with its cheap labour. There were also
allegations that the neighbouring country was misusing the facility to hurt
Indian exports.
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- Federation of Indian Export Organisations (FIEO) Director
General Ajay Sahai said there were complaints from Indian exporters about space
being reduced for their shipments at airports due to the transshipment facility
allowing cargoes from Bangladesh.
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- The announcement has come at a time when the US has
imposed hiked tariffs against most countries and is expected to hit the
Bangladesh economy.
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- The move also comes against the backdrop of controversial
statements made by Professor Muhammad Yunus, the Chief Adviser of Bangladesh’s
interim government, about India’s Northeast states during his recent visit to
China. Yunus had stated that with Northeast India being "landlocked",
Dhaka was the "only guardian of the ocean for all this region".
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- Indian had reacted strongly to the statement, which was
seen as an attempt by Bangladesh to assert its leverage over access to the
Northeast. Yunus has reversed Bangladesh’s foreign policy and has been moving
closer to China, a country which he views as a new strategic partner. This has
further soured relations between New Delhi and Dhaka.
