In a significant escalation of trade restrictions, the Indian Department of Foreign Trade announced on Friday that it has banned the import of nine categories of goods from Bangladesh through land ports.
This move marks the third phase of stringent measures introduced since March 2025 in response to provocative actions and rhetoric from Bangladesh’s interim government led by Chief Adviser Muhammad Yunus.
The latest restrictions target key Bangladeshi exports, including raw jute, jute rolls, jute yarn, and specialized fabrics, which, according to Bangladesh’s National Board of Revenue, generated $149.4 million (Tk1,645 crore) in exports to India during the 2023-24 fiscal year, with 99 percent ($147.7 million) facilitated through land ports.
While the ban prohibits these goods from entering India via land routes, imports through the Novoseva Port in Mumbai by sea remain permitted, offering Bangladesh a limited alternative trade channel. India’s phased trade measures began on April 9, 2025, when it withdrew transshipment facilities for Bangladeshi products at Kolkata airport, a critical hub for Bangladesh’s global exports.
This followed Yunus’s March 2025 remarks during a visit to China, where he described India’s northeastern states as “landlocked” and positioned Bangladesh as their sole maritime gateway, provoking a sharp response from New Delhi.
On April 13, after Bangladesh halted yarn imports from India through four land ports, India suspended transshipment facilities for Bangladeshi garments. On May 17, further restrictions were imposed on imports of ready-made garments, processed food, plastics, wooden furniture, yarn by-products, fruits, fruit-flavoured drinks, and soft drinks through land ports.
These measures are widely seen as India’s retaliation against Yunus’s anti-India policies, including his alignment with China through agreements like the Teesta River project and inflammatory statements challenging India’s regional influence.
By targeting Bangladesh’s export-dependent economy, India aims to pressure Yunus’s interim government to reconsider its provocative stance and foster a more conducive atmosphere for bilateral dialogue.
Context and motivation
The latest measures by Narendra Modi highlight India’s growing frustration with Yunus’s leadership since August 2024, particularly his March 2025 comments in China, which undermined India’s strategic interests by framing its northeastern states as dependent on Bangladesh for maritime access.
The trade restrictions—phased bans on key Bangladeshi exports through land ports—reflect India’s strategic use of economic leverage to counter Yunus’s provocations.
These measures target Bangladesh’s economic lifeline, as 99% of the affected goods (worth $147.7 million) are exported via land ports, signalling India’s intent to impose significant costs on Yunus’s government for its anti-India posture.
The decision to keep sea routes open suggests a calculated approach: India is not entirely severing trade ties but redirecting them to less convenient channels, increasing costs and logistical challenges for Bangladesh.
Hence, India shifts from cooperation to retaliation, as seen in the suspension of transshipment facilities at Kolkata airport and for garments, which were critical for Bangladesh’s global trade during and post-Covid-19.
Yunus’s policies
Yunus’s provocative actions, including his alignment with China (e.g., trade scopes in Seven Sisters and the Teesta River project agreements), revival of ties with Pakistan, and inflammatory rhetoric, such as the now-deleted social media post by his aide claiming Indian territories as part of Bangladesh, have fueled India’s perception of Yunus’s government as hostile, prompting the trade restrictions.
For instance, Bangladesh’s decision to halt yarn imports from India through four land ports (April 13, 2025) directly triggered India’s suspension of garment transshipment facilities, illustrating a tit-for-tat dynamic.
Moreover, Yunus’s comments during his China visit about India’s “landlocked” northeastern states and Bangladesh’s role as the “sole guardian of the ocean” challenged the strategic importance of India’s Siliguri Corridor.
India’s subsequent trade bans and bolstered military presence (e.g., S-400 systems, Rafale jets) reflect a broader strategy to counter Yunus’s perceived alignment with China, which Article 2 argues risks entangling Bangladesh in great power rivalries.
Therefore, the trade measures serve as both economic punishment and a signal to Yunus to moderate his rhetoric and policies.
Implications for Bangladesh’s economy and sovereignty
Yunus’s policies threaten Bangladesh’s sovereignty by aligning it with China and the US, potentially at the expense of regional stability and economic autonomy. The trade restrictions exacerbate these risks by disrupting Bangladesh’s export-driven economy, which relies heavily on India for trade infrastructure.
The $149.4 million in affected exports represents a significant economic hit, particularly since land ports handle 99% of this trade. Forcing exports through sea routes like Novoseva Port increases costs and delays, potentially eroding Bangladesh’s competitiveness in global markets.
Yunus’s anti-India stance is isolating Bangladesh regionally. By alienating India, a neighbour with a 4,000-kilometre shared border and deep cultural ties, Yunus risks undermining Bangladesh’s economic stability and diplomatic leverage. The suspension of transshipment facilities, as noted in both articles, further limits Bangladesh’s access to global markets, reinforcing that Yunus’s policies are compromising the country’s autonomy by making it more dependent on external powers like China for economic support.
India has always expressed concerns over cultural desecration (e.g., vandalism of Rabindranath Tagore’s ancestral home) and violence against minorities, particularly Hindus, under Yunus’s administration.
While the trade restrictions do not directly address these issues, the trade measures can be seen as part of India’s broader response to perceived cultural and political slights.
The vandalism of Tagore’s home, a symbol of shared heritage, and the arrest of Hindu leader Chinmoy Krishna Das have heightened India’s distrust of Yunus’s government.
The trade bans serve as an indirect means of expressing this frustration, complementing India’s diplomatic protests and calls for a “conducive” atmosphere. Additionally, Yunus’s alleged support for a US-backed corridor to Myanmar’s Rakhine State raises security concerns that resonate with India’s trade measures.
By restricting Bangladesh’s access to Indian infrastructure, India may be signaling its unease with Yunus’s foreign policy, which could destabilise the Indo-Myanmar border and India’s northeastern states. The trade bans, therefore, serve as both an economic and strategic tool to pressure Yunus into addressing India’s security concerns.
Yunus’ role and India’s strategy
Yunus’s anti-India rhetoric and alignment with China and the US are deliberate attempts to consolidate his interim government’s legitimacy, but at the cost of Bangladesh’s sovereignty.
The trade measures underscore the consequences of this approach, as they disrupt Bangladesh’s economic stability and highlight its dependence on Indian infrastructure.
Yunus’s failure to address India’s concerns—whether on minority safety, cultural preservation, or regional security—has escalated tensions, making India’s trade restrictions a predictable response. However, India’s strategy is not without risks.
By imposing trade bans, India may inadvertently push Bangladesh further toward China, as Yunus seeks alternative partners to offset economic losses.
Chinese debt traps and Bangladesh’s potential entanglement in great power rivalries suggest that India’s measures could backfire if they deepen Bangladesh’s reliance on Beijing. Moreover, the trade restrictions may fuel anti-India sentiment in Bangladesh, complicating efforts to restore bilateral trust.
India’s trade restrictions are a direct response to Yunus’s provocative policies, aligning with the critique of his anti-India stance and alignment with external powers. These measures aim to pressure Yunus’s government to moderate its rhetoric and policies, but they also risk further straining bilateral ties and pushing Bangladesh toward China.
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