India Restricts $770M Imports From Bangladesh; MSMEs To Gain From RMG Curbs, Say Experts

New Delhi: Restrictions imposed by India on certain Bangladeshi goods will help the domestic ready-made garment industry, particularly MSMEs, to enhance their competitiveness, according to experts.

On May 17, India restricted imports worth USD 770 million from Bangladesh, covering nearly 42 per cent of bilateral imports. Key goods like garments, processed foods, and plastic items are now limited to select sea ports or barred from land routes entirely.

Ready-made garments, valued at USD 618 million, now face strict routing through only two Indian seaports. This severely limits Bangladesh's most valuable export channel to India.

"Indian textile firms have long protested the competitive edge enjoyed by Bangladeshi exporters, who benefit from duty-free Chinese fabric imports and export subsidies, giving them a 10-15 per cent price advantage in the Indian market," think tank Global Trade Research Initiative (GTRI) said.

The port restrictions will help Indian MSMEs (micro, small, and medium enterprises) from the textiles sector, GTRI founder Ajay Srivastava said.

Sharing similar views, Apparel Export Promotion Council (AEPC) Vice Chairman A Sakthivel said it was a demand of domestic exporters to impose these restrictions.

"It is a good decision now taken by the Indian government. The domestic industry will benefit from this," Sakthivel said.

The move comes in response to Bangladesh's recent restrictions on Indian yarn, rice, and other goods, as well as the imposition of a transit fee on Indian cargo's departure from past cooperation.

Even as Dhaka moves closer to Beijing, India should not shut the door to dialogue, Srivastava said.

"As the bigger neighbour and regional power, India has a greater responsibility to lead with patience, keep communication open, and avoid using trade as a weapon. Rebuilding trust through diplomacy and economic cooperation is still possible," he said.

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