Dhaka and Delhi Seek Trade Reset
Commerce Minister Khandaker Abdul Muktadir and Indian High Commissioner Dinesh Trivedi met at the Secretariat on August 24 to discuss restoring bilateral trade. The talks covered reopening border haats, bringing land ports back to full operation, easing restrictions on Indian yarn imports and creating new avenues for business and investment.
In a Nutshell
- The two sides discussed reopening closed border haats, restoring land ports to full capacity and easing restrictions on yarn imports, which would directly ease some of the cross border trade bottlenecks created over the past year.
- In the meeting on August 24th, Indian High Commissioner to Bangladeshi Trivedi stated that both countries should have “business-to-business” while letting politics take its own course.
- He also emphasised the importance of exploring joint-venture business opportunities with Bangladesh in border areas.
- Commerce Minister Muktadir placed Bangladesh-India trade at around $13 billion and said that India remains the second largest trading partner after China.
- The commerce minister also said that the meeting with Trivedi was focused on finding solutions to the issues that have slowed down bilateral trade in the past one and a half years.
- In early 2025, tit-for-tat restrictions escalated when Bangladesh banned Indian yarn imports via land ports to protect domestic producers, prompting India to retaliate by suspending transhipment facilities and restricting Bangladeshi garment imports strictly to two sea ports, severely increasing costs and lead times.
Context
Today's talks signal a change in how both countries are approaching bilateral trade after a year of restrictions that have disrupted established routes and raised costs. Bangladeshi exporters faced longer routes into India after land port access was restricted, while Indian buyers and suppliers faced higher costs and narrower market channels due to reciprocal bans on land-based imports. The current focus on reversing these policies could therefore help restore the trade channels that businesses on both sides have lost.
Why It Matters
Commerce Minister Muktadir did not directly link the deterioration in trade to diplomatic tensions, while High Commissioner Trivedi explicitly prioritized business continuity. Amidst the various differences that remain unsolved in the diplomatic relationship, one thing seems certain: both countries are eager to bring trade back on track. Aside from lifting the border and import restrictions, more investment opportunities could also be on the horizon, with proposals underway to establish a joint task force for better cooperation between businesses in both countries.
What We Think
Trivedi's stance on separating commerce from politics is probably the clearest signal that both sides appear willing to keep economic ties moving despite political disagreements. The proposed border and port reopenings could start reversing the policies that have made trade more costly. If both sides are to work as equals, as Trivedi put it, we are looking at a start.