|
China diplomacy behind India's curbs on Bangladesh jute?

04 Jul '25

4 min read

China diplomacy behind India's curbs on Bangladesh jute?

Insights

India has restricted land imports of Bangladeshi jute and flax, forcing shipments through sea.
Move aims to protect domestic producers from alleged unfair trade and duty evasion.
The Bangladesh jute sector faces higher costs and disruption, threatening $***** million in trade.
Analysts link the ban to rising India-Bangladesh-China tensions.

Official justification

Indian authorities claim the ban is necessary to shield domestic producers from “unfair” trade practices, citing Bangladesh’s duty-free access under the South Asian Free Trade Area (SAFTA). Officials argue that this advantage has led to “dumped and subsidised” imports, harming Indian farmers and mills. Despite existing anti-dumping duties, imports rebounded to $*** million in FY****-**, allegedly depressing domestic jute prices below government-mandated levels and forcing production cuts. The government also alleges widespread circumvention of duties through mislabelling, technical exemptions, and round-tripping schemes. Publicly, the move is framed as protecting rural livelihoods, particularly in West Bengal—which produces ** per cent of India’s jute and aligns with the Atmanirbhar Bharat (self-reliant India) initiative. The DGFT asserts that mandating seaport entry will improve quality checks, curb fraudulent labelling, and strengthen enforcement against duty evasion facilitated by porous land borders.