MSMEs to Gain from Port Restrictions on Bangladeshi Imports
New Delhi, May 18 — India’s recent move to impose import restrictions on certain goods from Bangladesh is expected to provide a significant boost to the country’s domestic ready-made garment (RMG) industry, particularly benefitting micro, small, and medium enterprises (MSMEs), according to trade experts.On May 17, the Indian government announced restrictions on imports worth USD 770 million from Bangladesh, impacting nearly 42 per cent of total bilateral imports. The new rules particularly target key sectors such as garments, processed foods, and plastic items, which will now be routed exclusively through selected seaports or restricted from land routes altogether.
Major Impact on Garment Imports
Ready-made garments, which form the bulk of Bangladesh's exports to India—valued at USD 618 million—will now be restricted to just two Indian seaports. This effectively narrows Bangladesh's access to its most critical export route into the Indian market.According to the Global Trade Research Initiative (GTRI), Indian textile manufacturers have long raised concerns about the competitive advantages enjoyed by Bangladeshi exporters. These include benefits from duty-free Chinese fabric imports and generous export subsidies, which gave Bangladeshi products a 10-15 per cent price edge in the Indian market.
GTRI founder Ajay Srivastava stated that the newly imposed port restrictions will help Indian MSMEs in the textile sector regain their footing in a market where they have faced significant pricing pressure.
Industry Backs the Decision
Apparel Export Promotion Council (AEPC) Vice Chairman A Sakthivel welcomed the government's decision, noting that it had been a longstanding demand from Indian exporters."It is a good decision now taken by the Indian government. The domestic industry will benefit from this," Sakthivel said.
Diplomatic and Trade Backdrop
The import restrictions also follow recent trade tensions between the two neighbours. Bangladesh had earlier imposed curbs on Indian exports such as yarn and rice, and levied a transit fee on Indian cargo. These actions have strained bilateral economic ties and signaled a shift in Bangladesh’s foreign policy tilt toward Beijing.Despite the friction, experts caution against escalating trade measures.
"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," Srivastava noted.
The current developments mark a turning point in India-Bangladesh trade dynamics, with potential long-term implications for regional commerce and diplomatic relations.