India Bans Bangladesh Jute Imports via Land Routes Amid Trade Shifts

India has imposed a ban on jute imports from Bangladesh via land routes, marking a significant shift in the global jute trade dynamics. The move came after a series of phased restrictions, starting in April 2025 when Bangladesh lost its transshipment rights for goods bound for most overseas markets, with exemptions only for Nepal and Bhutan. By May, restrictions were expanded to non-jute goods such as garments and processed foods. The decisive step in June saw a complete land border ban on all jute imports, which now includes bleached and unbleached fabrics, sacks, ropes, and cordage. All Bangladesh jute exports must now pass through the Nhava Sheva seaport [1].

The Indian government has cited three main reasons for the restrictions: protecting the domestic jute industry from dumped and subsidized imports, improving quality control by centralizing inspections at a single maritime entry point, and addressing strategic concerns over Bangladesh’s growing ties with China and recent political developments in the country. Despite the anti-dumping duties imposed since 2017, Bangladesh's exports to India have continued to rise, partly due to misdeclaration and transit through third countries to bypass tariffs [1].

India’s jute industry is currently facing a crisis. In FY 2024-25, jute prices fell below the government’s Minimum Support Price of ₹5,000 per quintal. Six organized jute mills have already closed, leaving ₹1,400 crore in outstanding dues, with ₹400 crore being legacy debt. Over 400,000 workers, primarily in West Bengal and Bihar, are at risk of job losses. The influx of cheaper Bangladeshi jute has kept mill capacity underused, intensifying the financial strain on India’s domestic producers [1].

For Bangladesh, the $2 billion jute trade with India in 2024-25 is now at risk. The ban has led to increased transportation costs and longer transit times, as all exports must now reroute through Nhava Sheva, undermining their price competitiveness. The earlier transshipment withdrawal in April also disrupted an established corridor for jute goods bound for Europe and the Middle East through Indian territory. This is a critical blow at a time when competition from synthetic substitutes and alternative suppliers is expected to rise. In 2018, Bangladesh accounted for 74% of global jute exports, so the India ban could have a significant impact on market shares and supply chain strategies globally [1].

Looking ahead, India’s measures may encourage domestic value-added jute production. At the same time, Bangladesh is likely to seek to diversify its export markets beyond India. India’s Directorate General of Trade Remedies has initiated a mid-term review of anti-dumping duties on jute from Bangladesh and Nepal, assessing potential circumvention and considering the extension of duties to raw jute imports [1].

The India ban not only protects the domestic jute industry but also conveys a broader strategic signal. It offers some respite to Indian mills and farmers but forces Bangladesh to rethink its export strategy in the global trade system. The longer the restrictions remain in place, the more likely they are to reshape sourcing decisions, logistics networks, and the competitive landscape for jute globally [1].

Source: [1] India Bans Bangladesh Jute Imports Amid Global Trade Shift (https://coinfomania.com/india-bans-bangladesh-jute-imports-amid-global-trade-shift/)