Chattogram Port sees dramatic surge in India trade as land routes dry up

Bangladesh's trade with neighbouring India is undergoing a dramatic reshuffle. As land ports remain crippled by restrictions from New Delhi, exporters and importers on both sides are rushing to Chattogram Port – pushing volumes to record highs but also straining the country's main maritime gateway.

Imports from India through Chattogram port more than tripled in volume in July compared to the same month last year, while exports also nearly tripled in volume, according to National Board of Revenue (NBR) data.

July imports jumped 213% year-on-year in volume, reaching 479,625 tonnes, with values rising 80% to $521 million, data shows. Exports, though smaller in absolute terms, rose 176% in volume and 385% in value, totalling 18,741 tonnes worth $74.97 million.

Infographics: TBS

The surge carried into August. Partial NBR data up to 28 August show that exports through Chattogram have skyrocketed in volume and value year-on-year, rising from 8,116 tonnes worth $18.26 million in August 2024 to 76,255 tonnes worth $64.66 million this year. Imports, by contrast, decreased 31% in volume but rose slightly in value.

The trade rerouting comes after India imposed sweeping restrictions from May, banning several Bangladeshi exports – including ready-made garments, jute products, and processed food – via land ports and forcing them to go by sea. In April, Bangladesh banned yarn imports from India via land ports.

With talks with India stalled, experts warn that prolonged non-tariff barriers – trade restrictions without tariffs – could hit sectors unable to absorb rising maritime costs, with border districts already reporting job losses.

They also called on the government to take proactive steps to ease trade tensions with India.

Land ports sidelined

The fallout has been stark at the border. NBR figures show shipments through land ports plunged 26% in July and 52% in August, the steepest fall in years.

Once the backbone of cross-border trade, land gateways in West Bengal, Assam and Tripura have been left idle, forcing exporters to reroute to Chattogram and bear higher shipping and logistics costs.

The situation worsened when India terminated transhipment facilities on 8 April and imposed a ban on Bangladeshi cotton imports a week afterwards.

Garments weather the storm, others take a hit

The impact has varied across industries. Garments, which account for approximately 35% of Bangladesh's exports to India, have remained stable. In July, shipments rose 19% year-on-year to $62.8 million.

"Our production capacity is strong, and Indian buyers are covering the additional maritime costs, which has kept garment exports steady," said Belayet Hossain, former director of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

Jute has been the worst hit. Exports collapsed 74% in July to just $3.4 million, while food shipments fell 17%.

Chattogram-based BSP Food Products, which traditionally served Assam and Tripura, cut its workforce from 150 to 60 after losing access to those markets. Pran-RFL Group reported a 14% fall in exports to India, blaming both higher freight costs and long delays at Nhava Sheva Port.

Govt, analysts cautious

Commerce Adviser Sk Bashir Uddin acknowledged on 12 August that negotiations with India have stalled, though he insisted Bangladesh's export sector remains resilient.

Policy think tank, Centre for Policy Dialogue (CPD), cautioned that prolonged non-tariff barriers could weaken sectors unable to bear rising maritime costs, with border districts already seeing job losses.

"The trend of exports to India has been upward for a long time, and it is expected to go up further. But mutual benefits depend on removing these barriers," said Mahfuzul Hoque Shah, former director of the Chattogram Chamber of Commerce and Industry.

He said that depending solely on the Chattogram port is risky. "It is high time we made the best use of Mongla Port, which is now easily accessible from Dhaka and close to India's Nhava Sheva Port."

Ctg port under strain

Already handling more than 90% of Bangladesh's external trade, Chattogram Port is struggling with congestion, limited yard space and frequent vessel delays. The sudden redirection of India-bound cargo has further stretched it.

"We are ready to handle the additional pressure created by increasing exports to India via the seaport," said Omar Faruk, secretary of Chattogram Port Authority, noting that capacity had been expanded by 10%.

But business leaders argue that incremental measures won't be enough. They are pressing for fast-tracking of the long-delayed Bay and Laldia terminals, which could ease congestion and cut turnaround times.

Resilient but fragile growth

Despite the political upheaval, Bangladesh's overall exports to India rose 11% in FY2024-25 to a record $1.76 billion. But June 2025 saw a sharp 19% decline, reflecting the impact of barriers and delays.

Imports from India have shown volatility, climbing to $1.16 billion in March before plummeting to $726.8 million in June. July, however, brought a rebound to nearly $995 million.

Bangladesh is India's largest trading partner in South Asia, with two-way trade reaching over $14 billion in FY2023-24, according to Indian High Commission data. Bangladesh's exports to India were $1.97 billion.

Analysts warn that the unusual trade surge in July–August 2025 at Chattogram may be unsustainable. Without a political resolution with India and accelerated investment in port infrastructure, they fear the fragile gains could unravel.

Abdur Razzaque, chairman of the Research and Policy Integration for Development (RAPID), a non-partisan think tank, said that conducting trade with India through the Chattogram port could raise costs by about 25%, a burden that Bangladeshi traders would ultimately have to absorb, putting long-term trade sustainability at risk.

He said that land ports currently provide a crucial safety valve in times of crisis. "When there is a shortage of any commodity, we can import from India overnight through land ports to stabilise the supply chain. If those land ports become inactive during crises, we will be in real trouble," he said.

To avoid such risks, Razzaque recommended enhancing the capacity and efficiency of the Chattogram port so it can manage additional pressure from Indian trade. 

He also urged the Bangladesh government to take proactive steps to ease tensions with India, describing stable relations as "vital from a geopolitical perspective."

Moinul Islam, a former professor of economics at the University of Chittagong, said Bangladesh is now facing its worst-ever diplomatic ties with India, a situation that hurts both economies.

"The restrictions came from the Indian side, leaving Bangladesh with little scope beyond trying to improve relations. But I don't see much hope, as New Delhi is refusing to recognise the current interim government," he said.