Bangladesh is a major market for India’s textile and agricultural exports. High inflation and growing unemployment has been creating negative pressure on demand especially for non-textile items. The Dollar crisis and the recent political disturbance has further aggravated the situation. Since the Kharif harvest is around the corner, the exports of agricultural products could take an immediate hit. The unrest could also cast uncertainty over the potential free trade agreement talks, affecting investment.
The last two years have seen the exports moderate down. In the last financial year, exports to Bangladesh were valued at USD 11 billion. The decline in exports is partially seen in agricultural products, owing to export restrictions on rice, wheat and sugar to rein in domestic prices. Dollar shortage and rising inflation in Bangladesh also led to lower demand for exports.
In 2021-22, Bangladesh was India’s fourth largest export market. It slipped to the eighth position in FY 24 due to decline in outbound shipments. Imports from Bangladesh remained in the range of $0.4 billion to $0.7 billion from 2010-11 till 2017-18. Imports crossed $1 billion in 2018-19 and peaked at $2 billion in 2022-23. Last financial year saw a moderation in imports to $1.8 billion.
