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Informist, Wednesday, Aug 7, 2024

 

By Pallavi Singhal

 

MUMBAI - The ongoing political turmoil in Bangladesh should not impact India's farm commodity exports to the country beyond 7-10 days, traders and exporters told Informist.

 

India exported goods worth $11.1 bln to the neighbouring country in 2023-24 (Apr-Jun), according to data from the commerce ministry. Of this, exports of farm commodities to Bangladesh roughly amounted to $2.68 bln. Of all the commodities exported to Bangladesh, cotton's share is 17%. Other agri commodities include oilmeals, spices, rice, and wheat, as well as tea and coffee in smaller amounts.  

 

"We are in active contact with Bangladeshi importers. The current situation is only a blip. Importers, too, are sure of the situation and trade returning to normal quickly. We expect exports to stabilise within the next week," Narinder Wadhwa, national president of the Commodity Participants Association of India said.
 

India's exports to Bangladesh can be divided into two prime categories. One sector includes long-term goods such as engineering products, chemicals and petroleum products; the other includes perishable goods such as fruits, vegetables, rice and wheat. "This happens through road trade from neighbouring states of India which lie close to the Bangladesh border," Ajay Srivastava, founder of Global Trade Research Initiative, a think tank, said. "Their economy has already been in trouble and if they decide to import these essential goods from anywhere else but India, their costs will double." 

 

Meanwhile, the situation which unfolded after Sheikh Hasina resigned from the post of Bangladesh prime minister and fled to India on Monday has led to almost a complete halt to trade. Over 300 trucks carrying varied spices remain stranded at the ports with payments to traders from earlier consignments too halted, Manan Mota, export division head, Rajdeep Trading Company, Neemuch said.

 

"Immediate trade has been impacted and even the transport of perishable commodities to Bangladesh, which was being given priority till Monday night, has come to a halt," Ajay Sahai, director general and chief executive officer of the Federation of Indian Export Organisations said.

 

According to Sahai, only the Land Custom Station (LCS) at the India-Bangladesh Border at Agartala, which was a large facility handling cargo services, remains operational while allowign only very small movement of goods.

 

However, he expressed confidence that trade will normalise within the next 10 days. "It should be business as usual soon. The Bangladesh GDP is already facing issues relating to inflation and would not want it to rise further," he said.

 

Bangladesh's economy has seen mounting challenges over recent years which hurt bilateral trade with India. India's exports to the country have fallen over the years – to $11.1 bln in 2023-24 from $12.2 bln in 2022-23 and $16.2 bln in 2021-22. India enjoys a big trade gap in its favour with imports from Bangladesh remaining almost stable, increasing to $2 bln in 2022-23 from $1.9 bln in 2021-22, before sliding back to $1.8 bln in 2023-24.  End

 

(With inputs from Taniva Singha Roy)

 

US$1 = 83.96 rupees

 

Edited by Tanima Banerjee

 

 

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