Dr. Shyamal Das
Preface
I write these words knowing full well that they may serve as yet another brick in the wall of suspicion that has followed me my entire life—the accusation that I am an Indian sympathizer, a RAW agent, a man from “the other side.” This branding, born not from betrayal but from nuance and inquiry, has shaped my journey through Bangladesh’s intellectual and public spaces.
I have grown up hearing that India thrives by exploiting Bangladesh. That every misfortune we suffer must trace back to New Delhi. This belief is so entrenched in our national psyche that it often feels like a sacred dogma—a divine revelation embedded in our political and cultural soil. Because of my last name alone, I have been labeled a traitor. Even within academic circles, at Shahjalal University of Science and Technology, I’ve heard so-called “refined” colleagues declare in meetings, “These bastards should be kicked across the border.” Their crime? Holding a divergent opinion. Ours? Expressing it.
Despite being a student of development sociology, a field in which I have freely and repeatedly criticized India’s policies and regional hegemony, I have never been spared the slanderous label of being a “passenger from across the border.”
But this preface is not about settling personal scores. It is about intellectual honesty. It is about the necessity to ask whether the recent Indian bans on transit and transshipment inflicted any real losses on Bangladesh—and if so, what that says about the widespread narrative that India alone has benefitted from its treaties with Bangladesh. If these cancellations caused us harm, then perhaps we must question the sweeping claims that previous agreements under the Awami League government were wholly one-sided in favor of India. In this small journey, I will touch on a few of the significant treaties between India and Bangladesh during 2009-2024 timeframe.
Introduction
The bilateral relations between India and Bangladesh have been marked by a series of treaties and agreements aimed at enhancing cooperation in trade, transit, energy, and infrastructure. While some narratives suggest that these agreements disproportionately favored India, a closer examination reveals that Bangladesh accrued significant benefits, both tangible and strategic. This paper explores the financial and strategic implications of these treaties during the last Awami League (AL) regime, challenging the view that Bangladesh was merely a passive partner.
- Key Agreements (2009–2024)
2010 Framework Agreement for Cooperation.
Land Boundary Agreement (2015): Resolved long-standing border issues.
Transit and Transshipment Agreements: Facilitated movement of goods through Bangladesh to India’s northeastern states.
Port Access Agreements: Allowed India to use Chattogram and Mongla ports.
Energy Cooperation: Cross-border electricity trade and joint power projects. - Bangladesh’s Financial and Strategic Gains
a. Transit and Transshipment Revenues
Bangladesh set a transit fee of Tk 589 per tonne for Indian goods transported through its territory, with additional charges including Tk 1.85 per tonne per kilometer, document processing fees, security charges, administrative fees, and escort charges.
These fees contributed to Bangladesh’s revenue streams and justified infrastructure investments in ports and logistics.
b. Infrastructure Development
India financed several infrastructure projects in Bangladesh, including:
Akhaura-Agartala Rail Link: $47.8 million investment.
Khulna-Mongla Port Rail Line: $388.92 million concessional line of credit.
Maitree Super Thermal Power Plant: $1.6 billion investment.
These projects enhanced Bangladesh’s connectivity and energy capacity.
c. Energy Trade
Cross-border electricity trade facilitated optimal utilization of energy resources in both countries. - India’s Benefits
Logistical Advantages: Access to Bangladesh’s ports reduced transportation distances to India’s northeastern states by approximately 1,200 km, lowering costs and time.
Strategic Connectivity: Enhanced access to the Northeast bolstered India’s Act East policy and regional integration efforts. - Net Balance: Mutualism vs Asymmetry
The perception that India reaped all the benefits while Bangladesh was left behind is misleading. While India did achieve notable logistical and strategic gains, Bangladesh also enjoyed substantial, though sometimes less visible, benefits. From infrastructure improvements to trade earnings and energy revenues, Bangladesh’s gains were real and measurable. - Impact of Transshipment Cancellation: Quantifying the Losses
a. Bangladesh’s Financial and Strategic Setbacks
i. Disruption of Export Routes and Increased Costs
Between January 2024 and March 2025, Bangladesh transshipped over 34,900 tonnes of apparel products, valued at approximately $462.34 million, through India to 36 countries including the US, EU, and UAE.
With the withdrawal of the facility, exporters now face longer and more expensive routes. Shipping costs are projected to rise by 15–20%.
ii. Stranded Shipments and Immediate Financial Losses
As of May 19, 2025, 36 trucks carrying garments worth Rs 5 crore (approximately $600,000) were stranded at the Benapole-Petrapole border due to the sudden enforcement of the ban.
iii. Long-Term Strategic Implications
The RMG sector, accounting for over 80% of Bangladesh’s exports, relies heavily on timely deliveries. Delays and cost escalations may lead to loss of market share to Vietnam or Cambodia.
The cancellation hampers Bangladesh’s ability to trade efficiently with Nepal and Bhutan, potentially violating WTO rules.
b. India’s Economic and Strategic Repercussions
i. Loss of Revenue from Transshipment Services
Indian ports and airports previously facilitated significant Bangladeshi export volumes. The cessation of this activity results in reduced handling revenues.
ii. Impact on Domestic Industries and Consumers
Indian apparel manufacturers and retailers reliant on Bangladeshi imports may face supply chain disruptions. Price hikes of 2–3% on T-shirts and denims are expected during peak seasons.
iii. Geopolitical and Strategic Costs
The abrupt cancellation could strain diplomatic relations, affecting future cooperation.
Bangladesh may explore alternative trade routes and partnerships, diminishing India’s influence in regional trade.
- Comparative Table of Gains and Losses (Present and Future Outlook)
Category Bangladesh (Past Gains) India (Past Gains) Bangladesh (Next 2 Years – Outlook) India (Next 2 Years – Outlook)
Transit Fees & Port Revenue $1.5M+ annually from Indian cargo Cost savings of 20-30% on NE shipments Loss of $3–5M/year in fees due to cancellation Loss of 30–40% efficiency in NE logistics
Apparel Transshipment $462.34M in export volume facilitated Streamlined logistics for Indian exporters/importers Export cost increase by 15–20%; revenue drop potential Higher import prices; Rs 1000 Cr trade shift
Energy Trade Revenue from power exports Reliable grid support Continued, but subject to political climate Same, potential new dependencies
Infrastructure Projects $2B+ in Indian investment in roads, rails, ports Regional influence via development finance Halted projects or delayed expansions Reduced goodwill and regional access
Strategic Position Transit hub for Nepal/Bhutan trade (pre-2025) Bypassed Siliguri Corridor Lost leverage in regional corridors Eroded Act East momentum - Conclusion
The treaties and agreements between India and Bangladesh during the last AL regime yielded mutual benefits. Bangladesh gained financially through transit fees, infrastructure development, and energy trade, while enhancing its strategic position in South Asia. The recent cancellation of transshipment and transit facilities highlights the fragility of regional cooperation and suggests that mutual economic interests must be preserved through stable diplomacy and balanced policies.
References
The Daily Star (2023). “Lowest transit fee set at Tk 589 per tonne for Indian goods.”
Indian Express (2025). “Rise and Fall of India-Bangladesh Transshipment Ties.”
Times of India (2025). “Clothes of Rs 5 crore stuck at Benapole border.”
TexFash (2025). “India’s Trans-shipment Ban: Blow to Bangladesh Apparel Ambitions.”
Economic Times (2025). “India limits 42% of imports from Bangladesh.”
Reuters (2025). “India withdraws transhipment facility via land borders.”
AP News (2023). “India-Bangladesh joint Maitree power plant details.”
ReGlobal (2024). “Cross-Border Electricity Trade Gains Traction in South Asia.”
Ministry of Shipping, Bangladesh (2022). “Annual Report on Port Revenues.”
Bangladesh Power Development Board (2023). “Energy Export and Import Statistics.”
ADB and World Bank (2021-2023). “India-funded Infrastructure Projects in Bangladesh.”
WTO Trade Facilitation Database.