India targets boosting exports from north-eastern region

Pushes Bangladesh for lifting 'land port restrictions'

Syful Islam | Published: June 02, 2018 23:08:07

India is pushing Bangladesh for keeping its land ports open to facilitate easy entry of products from the north-eastern states, officials said.
The idea is to boost exports from India's lagging north-eastern region.
"In my opinion, easing of port restrictions at the key trading points would be extremely helpful ...," Indian commerce minister Suresh Prabhu wrote in a recent letter to his Bangladesh counterpart, Tofail Ahmed.
This will help integrate "the local population on both sides of the border, for mutual benefit," he said.
Trade officials said there is no 'port restrictions' on the Bangladesh side.
Instead, there is an instruction so that products can enter through all the ports, they said.
This is because every land port is not equipped with all types of testing or checking facilities.
When Bangladeshi exporters send goods to any Indian border port, officials there create obstacles.
For example, an Indian port does not allow all Bangladesh products to enter under different pretexts, including the absence of testing or other facilities there.
This leads to stucking up of Bangladeshi exports in Indian land ports for weeks or even months, waiting for test results to come in from several hundred kilometres away.
In the meantime, the goods lose quality and some even get rotten, the officials said.
Despite being the second-largest sourcing point for Bangladesh, an official said, India further wants to raise its exports to its eastern neighbour.
India wishes to send all types of goods to Bangladesh through every land port or border trading point.
Even, it has targeted raising the exports of local products from its remote north eastern states to Bangladesh.
In the letter, the Indian minister cited restrictions in place at almost all the border trading points on the Bangladesh side.
"This has resulted in hugely 'disproportionate trade' at many of these trading points, especially in the north east region of India."
He also wrote that in the Indian fiscal year 2016-17 the exports from Bangladesh through the Agartala-Akhaura integrated check post (ICP) were worth US$20.91 million.
But the shipment from India to Bangladesh through the similar point was "almost nil".
Mr Prabhu referred to the "substantial" trade imbalance in other trading points on the India-Bangladesh border in the north eastern region of India.
The minister also referred to the joint-statement of the prime ministers of both countries issued in April 2017.
The joint-statement emphasised the need for removing all trade barriers, including that of port restrictions, to facilitate trade.
He, however, noted that the concern expressed by Bangladesh over allowing new items to come in through the land ports is valid, given the limited resources, infrastructure, security, and testing facilities are available there.
The Indian minister also underscored that the state governments of the Indian north-east region are pursuing the removal of port restrictions.
This will help the farmers and the industry in the region benefit from international trade with Bangladesh, he said.
He also suggested expediting the infrastructural development work of the Benapole land port for the speedy entry of trucks from India.
He underlined the need for steps such as early widening of the connecting road and the optimal utilisation of the warehouses.
The application of progressive tariff structure for warehouses could provide "a lasting solution to the problem," the Indian minister wrote.
In the fiscal year 2016-17, Indian exports to Bangladesh stood nearly $7.0 billion. In contrast, Bangladesh's shipment to the neighbouring country was only $672.40 million.
Traders blame the presence of a large number of non-tariff and para-tariff barriers for Bangladesh's exports remaining considerably small.
Bangladesh's major exports to India include apparels, home textiles, agri-products, frozen food, leather and leather goods, footwear, raw jute, jute goods, and bicycle.
And major imports from India include cotton, cotton fabrics, vehicles, boilers, machinery, cereals, edible vegetables, iron and steel, organic chemicals, and electrical machinery.
syful-islam@outlook.com