Union Government Withdraws Trans-Shipment Facility for Bangladesh Exports

In a recent decision, the Union Government has terminated the trans-shipment facility that allowed cargo export from Bangladesh to third countries to pass through Indian land customs stations en route to Indian ports and airports.

This decision, effective from April 8, 2025, follows remarks made by Bangladesh’s interim government chief adviser, Muhammad Yunus, during his visit to China. Yunus referred to India’s northeastern states as a "landlocked region with no access to the ocean" and positioned Bangladesh as the "sole guardian of the ocean in the region".

According to a government circular, the External Affairs Ministry clarified that the termination of this facility would not affect Bangladesh's exports to Nepal or Bhutan, which transit through Indian territory. The Ministry explained that the decision was driven by logistical delays and rising costs, which were impacting India's own exports and contributing to backlogs.

"The transshipment facility extended to Bangladesh had over a period of time resulted in significant congestion at our airports and ports. Logistical delays and higher costs were hindering our own exports and creating backlogs. The facility, therefore, has been withdrawn with effect from April 8, 2025," said External Affairs Ministry spokesperson Randhir Jaiswal.

The Central Board of Indirect Taxes and Customs issued a circular on April 8, rescinding the earlier Circular No. 29/2020-Customs, which allowed the transshipment of export cargo from Bangladesh to third countries through Indian land customs stations. However, the new circular specifies that cargo already entered into India will be allowed to exit as per the procedures outlined in the previous circular.

Indian exporters, particularly those in the apparel sector, had urged the government to withdraw this trans-shipment facility, citing the negative impact on domestic trade.

The trans-shipment facility, introduced in June 2020, had facilitated smooth trade flows for Bangladesh's exports to countries like Bhutan, Nepal, and Myanmar.