Another positive development of the India-Bangladesh relations has been the active participation of Meghalaya in further enhancing the North Eastern border state’s growing trade and commerce with the neighbouring country.
Meghalaya’s Chief Minister Conrad Sangma met a visiting delegation from Dhaka in 2022 and discussed the modalities of further enhancing cross-border trade of Bangladesh’s much needed raw materials like boulder and coal.
Bangladesh is dependent on these items and has emphasised the need for their uninterrupted supply which stopped abruptly during the Covid-19 crisis. The Meghalaya government has assured Bangladesh of its full cooperation in this regard.
In another major development on April 25, 2023, Bangladesh’s National Board of Revenue (NBR) granted permission to transport goods from one Indian state to another using the country’s key ports under a bilateral agreement signed in October 2018.
The NBR issued the permanent standing order to use Chittagong and Mongla seaports for transit and transshipment to carry goods to and from India through Bangladesh’s territory following the completion of trial runs for the operationalisation and regular movement of goods.
A Standard Operating Procedure (SOP) for passenger and cruise was also signed between the two neighbouring countries in 2019. Another agreement was signed between India and Bangladesh to use inland water transit for transportation of goods from West Bengal to seven North Eastern states through Bangladesh’s territory.
Reports say there are about 16 routes between the two Bangladeshi ports and North Eastern states. The development assumes significance as it will drastically reduce the cost and time for India of transporting goods from one state to another.
The distance by road between Kolkata and North Eastern states is more than 1,200 km while Chittagong and Mongla ports are located at almost half the distance.
Following the approval of permanent access to Chittagong and Mongla ports, Kolkata’s Shyama Prasad Mokherjee Port (SMP) is set to initiate regular cargo transportation to the North Eastern states via Bangladesh soon.
The move intends to substantially reduce the time and costs associated with transporting goods to the North Eastern states. In order to enable smooth transit and transshipment of goods, the Bangladesh government has also allowed four transportation routes for the movement of goods within Tripura and other North Eastern states.
The approved routes include transportation to Dawki in Meghalaya via Tamabil in Sylhet, Sutarkandi in Assam via Sheola, and Srimantapur in Tripura via Bibir Bazar in Comilla, as well as the reverse directions. Cargo originating from India and arriving at Chittagong and Mongla ports can be directed to Agartala, through Akhaura in Bangladesh.
Reports suggest that the SMP is in the process of establishing a new terminal at Balagarh, situated 85 km upstream of the Hooghly river to provide convenient cargo access for the North Eastern states.
In recent months, India has been making efforts to use Bangladesh’s rivers and ports for the transshipment of goods from the Kolkata Port to the North Eastern states. Reports say several trial runs have been carried out in the states of Assam, Meghalaya and Tripura on the use of Bangladesh’s Chittagong and Mongla ports for the transportation of goods to and from the North Eastern states, though more needs to be done for improvement of infrastructure, alignment of customs and other procedures in order to operationalise these routes.
Meanwhile, on 20 September, 2022, Bangladesh’s State Minister for Waterways Khaled Mahmud Choudhury said the AL government has decided to undertake dredging in old Brahmaputra river for the restoration of its dry season flow. Once the dredging programme is completed, navigation through the Brahmaputra will vastly improve and reduce 116 km distance in the Indo-Bangladesh Protocol Route.
In one more development on the waterway connectivity front, the first cargo ship vessel sailed from Kolkata in first week of August 2022 carrying 16 tons iron pipes in a container via Mongla Port with destination Meghalaya using the Tamabil-Dawki border points and 8.5 tons of pre-foam in another container for Assam was using the Bibir Bazar-Srimantapur border points.
The cross-border trade has been increasing in recent months with India facilitating export of much needed wheat to Bangladesh through the Hilli Land Port in Dinajpur contributing significantly towards easing inflation in the neighbouring country.
During the September 2022 bilateral summit, the prime ministers of India and Bangladesh directed their respective officials to work together to address the issues of pollution in rivers and to improve the riverine environment and river navigability in respect of common rivers.
According to the joint statement issued after the summit, the Indian side reiterated its request to work towards the expansion of the bilateral Coastal Shipping Agreement of 2015 to include third country EXIM Cargo (i.e. any loose cargo/bulk cargo/liquid cargo/break-bulk cargo/containerised cargo bound for import and export).
New Delhi and Dhaka also agreed to expeditiously explore direct shipping links between the two countries. They further agreed to implement the decision to commence riverine services under the Protocol on Inland Water Transit and Trade (PIWTT) routes number 5 and 6 (Dulian to Rajshahi-extension to Aricha and 9 and 10, Daudkandi to Somamura, respectively).
In July 2023, Union Minister of Ports, Shipping and Waterways Sarbananda Sonowal announced that the GoI is planning to develop an Eastern Grid with 5000 kms of navigable waterways connecting neighbouring countries including Bangladesh.
The GoI believes that the development of this grid will not only boost regional integration and accelerate development but will further deepen eastern India’s trade with the BBIN countries.
With seamless connection between National Waterway (NW)-1 (Ganges), NW-2 (Brahmaputra) and NW-16 (Barak), the GoI is keen to create an economic corridor linking North East with rest of India via Bangladesh. The initiative has the potential to generate multilateral trade worth $49 billion.
The India-Bangladesh trade has been expanding rapidly in recent years. India’s merchandised exports to Bangladesh have increased from $ 7 billion to about $ 20 billion over the last five years, while Bangladesh’s exports to India has reached almost $ 2 billion in the fiscal year (FY) 2022-23.
India with its vast and diverse market has emerged as one of the top export destinations for Bangladesh in Asia. For India too, Bangladesh is the country’s largest trade partner in South Asia.
The improvement of connectivity and development of border infrastructure could enhance bilateral and sub-regional trade. An August 2021 World Bank report titled “Project Information Document” has noted that while intra-BBIN trade has increased from $ 3 billion in 2005 to over $ 18 billion in 2019, indicating a six-fold rise, opportunities for regional trade remains largely untapped.
The unexploited trade potential of the BBIN countries is estimated at 93% for Bangladesh, 50% for India and 76% for Nepal. The expansion of cross-border connectivity has largely benefitted Bangladesh during the Corona virus pandemic, with more than 4,000 tons of liquid medical oxygen transported to the country.
Being a major development partner, India is playing a key role in improving the transport networks of Bangladesh. Reports say the up gradation of Mongla port is the largest project in the shipping/port sector that the GoI is financing under the concessional line of credit.
The improvement of connectivity between India and Bangladesh will fetch rich dividends for both the nations. The opening of the Padma Multipurpose Bridge on 25 June, 2022, will further augment bilateral trade and commerce between West Bengal and Tripura by making transportation of goods cheaper, faster and safer.
The Padma Bridge will vastly improve connectivity between Bangladesh and India and in the South Asian sub-region boosting the Bangladesh, Bhutan, India and Nepal (BBIN) Motor Vehicle Agreement (MVA) initiative.
