India resumes agricultural exports to Bangladesh as border-trade points open
With over $18 billion worth of bilateral trade, Bangladesh is India’s largest trade partner in South Asia after China and a large market of farm produce
New Delhi: Export of agricultural produce, largely onion, from India to Bangladesh has resumed through the land border, albeit on a smaller scale, after a stall in the wake of the political crisis, neighbouring countries’ suppliers and trade officials said on Friday.
About 17 trucks laden with onion, an essential commodity for which the neighbour relies on India to meet local demand, have begun entering Bangladesh through West Bengal after clearances from both sides, Arihant Pednekar, an official of the Lasalgoan agricultural produce market committee in Maharashtra, said.
The official said onion shipments have gone through after banks in Bangladesh reopened as many traders held export guarantees issued by Bangladeshi banks. Lasalgaon is Asia’s largest agricultural market for onions.
With over $18 billion worth of bilateral trade, Bangladesh is India’s largest trade partner in South Asia after China and a large market for farm produce.
Bilateral trade had ground to a halt amid unprecedented violence and protests that toppled the Sheikh Hasina regime. Indian exporters were stuck as borders were closed and supply chains had completely collapsed.
India, the world’s largest exporter of onions, supplies up to 800,000 tonne to Bangladesh, one of the largest buyers. In 2023-24, the net value of onion exports stood at Rs.3,513 crore, lower than Rs.4,525 crore in the previous year. In 2023-24, Bangladesh imported 724,000 tonnes of bulbs from India.
India had banned overseas onion sales in December last year to boost domestic supplies after patchy rains in key states led to a 20% fall in output. Shipments were allowed on May 4, 2024, with a minimum export price (MEP) of $550 per tonne plus 40% tariff. MEP is a floor price below which traders can’t export. It’s a regulatory tool designed to discourage too many exports at cheap rates.
“Trade has resumed with the opening of the land border at designated points. Prices haven’t gone up much in Bangladesh because exports were going routinely before the protests. Any further delay would have caused losses to our exporters and price rise in Bangladesh,” Pednekar said.
Apart from onions, India also exports non-basmati rice, sugar, and cotton to the neighbouring nation, where a new interim government has taken charge after the ouster of the Awami League government led by Hasina.
Ajit Shah, the president of the Onion Exporters’ Association, said the government should remove the export duty on the commodity as the current crop is in a robust condition. He said Bangladesh aside, Malaysia, Sri Lanka, Indonesia, and the Mideast were also important markets for India.
