Bangladesh port curbs could redirect textile orders worth Rs 1,000 crore to India, block China fabric backdoor

While imports through seaports remain open, the move addresses concerns over duty-free imports impacting local production. It counters Bangladesh's cotton yarn export restrictions and potentially reduces indirect Chinese textile imports.

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India's recent decision to curb imports of garments and other products from Bangladesh via land routes could create a significant opportunity—worth Rs 1,000 to Rs 2,000 crore—for the domestic textile sector, industry leaders say. However, the move may also temporarily disrupt supply chains for both Indian and global apparel brands during the upcoming winter season.

The notification, issued by the Directorate General of Foreign Trade (DGFT) on May 18, restricts imports of Bangladeshi goods—especially garments—through land ports. Imports, however, will still be allowed through the Kolkata and Nhava Sheva seaports. The restriction follows mounting concerns over duty-free textile imports from Bangladesh, which have been undercutting local production due to India's zero-duty policy under SAFTA.

Industry players have welcomed the move as a timely and strategic response to Bangladesh's own protectionist steps. "In April 2025, Bangladesh imposed a restriction on the export of cotton yarn from India, which traditionally accounts for nearly 45% of India's total cotton yarn exports," said Rakesh Mehra, Chairman of the Confederation of Indian Textile Industry (CITI). "India's latest decision addresses that imbalance and opens the door for Indian ready-made garment (RMG) manufacturers to fill the supply gap."

Experts believe the policy could also reduce the indirect entry of Chinese textiles routed through Bangladesh, a common practice to avoid India's 20% duty on direct Chinese imports.

Santosh Katariya, President of the Clothing Manufacturers Association of India (CMAI), called the move a "long-pending" industry demand to protect MSMEs from the unchecked inflow of cheap, foreign-made garments. "This decision will strengthen India's self-reliance in apparel production. That said, we urge continued policy support for capacity building and reducing compliance burdens on domestic players," he said.

According to industry estimates, imports currently meet 1–2% of India's total apparel demand, with Bangladesh accounting for nearly 35% of these imports. With the land route shut, experts expect a drop in import volumes and a price increase of 2–3% for categories like T-shirts and denims in the near term.