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New Delhi | India on Saturday decided to allow entry of ready-made garments from Bangladesh only through Kolkata and Nhava Sheva sea ports and barred imports of a range of consumer items through land transit posts in the northeast -- a move that is set to significantly hit Dhaka's trade with New Delhi.

A late evening government notification said import of ready-made garments from Bangladesh will not be allowed entry into India through any land ports.

Besides ready-made garments, plastics, wooden furniture, carbonated drinks, processed food items, fruit flavoured drinks, cotton and cotton yard waste will not be allowed to enter India through land customs stations and check posts in Meghalaya, Assam, Tripura and Mizoram, and Phulbari and Changrabandha in West Bengal, according to the notification.

The new restrictions for Bangladeshi consumer goods came over five weeks after New Delhi ended a nearly five-year-old arrangement for trans-shipment of Bangladeshi export cargo to third countries via Indian airports and ports.

The new restrictions have been imposed with immediate effect.

India's fresh restrictions on limiting access to Bangladeshi exports appears to be in response to Dhaka denying certain value added items from the Northeast to enter that country through the land transit points.

The friction in trade ties between the two countries came amid increasing strain in the overall relations after deposed Prime Minister Sheikh Hasina fled Dhaka in August last year in the face of a massive anti-government protest.

The notification on restrictions on Bangladeshi imports has been issued by the Director General of Foreign Trade.

Bangladesh is a major global exporter of readymade garments, and the value of its exports in the sector was estimated at USD 38 billion in 2023.

Its annual RMG exports to India is estimated at around USD 700 million and 93 per cent of the RMG shipments enter India through land ports.

The notification said the restrictions will not apply to import of fish, LPG, edible oil and crushed stone from Bangladesh.

The restrictions will also not be applicable to Bangladesh's exports to Nepal and Bhutan through India.

There are 11 land transit points in the northeast for trade between India and Bangladesh. Out of them, three are in Assam, two in Meghalaya and six in Tripura.

India had previously permitted export of Bangladesh goods through all land trading points and seaports without undue restrictions.

However, Bangladesh continued to impose port restrictions on Indian exports at Land Customs Stations (LCS) and Integrated Check Posts (ICP) bordering northeastern region, people familiar with the matter said.

India had taken up the issue with Dhaka but there was no positive response.

Further, yarn exports from India across land-ports have been stopped by Bangladesh with effect from April 13.

The people cited above said Indian exports are subjected to rigorous inspection on entry, and Indian rice exports are not allowed through Hili and Benapole ICPs since April 15, in addition to existing restrictions.

Industrial growth in the northeastern states suffered due to imposition of "unreasonably high" and "economically unviable" transit charges levied by Bangladesh, the people cited above said.

Bangladesh's approach resulted in denying access to the northeast from Indian hinterland, they said.

Due to land-port restrictions by Bangladesh, the northeastern states are suffering from lack of access to Bangladesh market to sell locally manufactured goods, restricting the market access to primary agricultural goods only, the people said.

Bangladesh, on the other hand, has free access to the entire northeast market, creating an unhealthy dependency and stymieing growth of manufacturing sector in the north-eastern states, they said.

In order to promote 'Atmanirbhar Bharat' and support local manufacture in the Northeastern states, it is understood that India has decided to impose port restrictions across all LCSs and ICPs in Assam, Meghalaya, Tripura and Mizoram, they added.

There has been a sharp downturn in India-Bangladesh relations after deposed prime minister Sheikh Hasina fled Dhaka and took shelter in India in August last year in the face of a massive anti-government protest.

The relations nosedived dramatically after the interim government headed by Muhammad Yunus failed to contain attacks on minorities, especially Hindus, in that country.