Alternative export routes shrink, pressure to rise

India withdrew a key transshipment facility that had allowed Bangladeshi exporters to use Kolkata airport for air shipments. The move, which took effect on Wednesday, ends a six-and-a-half-year arrangement and is expected to put significant pressure on Bangladesh’s air cargo capacity—particularly for the readymade garment (RMG) sector.

According to Benapole Land Port authorities, since India introduced the facility in 2018, a total of 624 Bangladeshi companies exported goods through Kolkata airport via road transport from Benapole. Among them, 606 were garment industry companies. So far, Bangladesh has exported goods worth around USD 980 million through Kolkata airport under this arrangement.

Exporters say air shipments via Kolkata were not only cheaper—saving 50 cents to 1 dollar per kg compared to Dhaka—but also faster, as congestion at Dhaka’s Shahjalal International Airport had become increasingly common. With India now cancelling the facility, Bangladesh has lost a vital alternative route for garment exports, which could lead to additional strain on the country’s air cargo system.

According to the National Board of Revenue (NBR) and exporter sources, about 44,000 tonnes of goods were exported through Benapole and Kolkata airport last year. With the transshipment facility withdrawn, that same volume must now be routed through Shahjalal Airport. As a medium-sized cargo aircraft can carry about 60 tonnes, at least 730 additional flights will be needed to handle the load. Exporters fear this increased pressure could drive up air freight charges for shipments to Europe and the US, and also cause bottlenecks at Dhaka airport.

According to Benapole Customs, Fakir Fashion from Narayanganj exported the highest volume of garments under the transshipment facility provided by India. The company exported 4,750 tons of goods worth approximately USD 70 million. Their latest shipment was sent to Spain via Kolkata airport, transported by road from Bangladesh through Benapole port last Monday.

Speaking to Prothom Alo, Fakir Fashion’s Managing Director, Fakir Kamruzzaman Nahid, said, “Buyers mainly used Kolkata airport to cut costs when purchasing our products. Now that India has withdrawn the facility, the capacity of Shahjalal Airport must be increased so that the garment sector doesn’t suffer. At the same time, air freight charges need to be brought under control.”

In July last year, four shipments from Chattogram-based Eastern Apparels were exported to Sweden via Kolkata airport. Asked why foreign buyers chose Kolkata, the company’s Managing Director, Nasir Uddin Chowdhury, told Prothom Alo that at the time, air freight from Kolkata was 50 cents per kg cheaper than from Dhaka. “There are also delays in securing bookings in Dhaka,” he said. “So, foreign buyers used Kolkata airport to reduce costs and receive their goods faster.”

On 2 November 2018, India’s Central Board of Indirect Taxes and Customs issued an order on a trial basis, allowing goods to be exported to third countries via Kolkata Airport and Kolkata Port through road transport via the Petrapole customs station (Benapole on the Bangladesh side). The order also allowed the use of India’s Nhava Sheva Port via rail through the Gede customs station (Darshana in Bangladesh). However, in practice, Bangladesh only utilised Kolkata airport via Benapole.

Following the introduction of this facility, Gazipur-based PN Composite made the first shipment on 4 November 2018, exporting T-shirts weighing around 4,000 kilograms and worth USD 60,000 to Spain via Kolkata airport. After the success of this trial consignment, India gradually extended the duration of the facility.

According to Benapole Customs, although the facility became available in 2018, only a few consignments were exported in the initial years. Usage significantly increased from 2023 onward. In 2023, goods worth USD 190 million were exported using this route, while in 2024, the value rose to USD 620 million. So far this year, 1,888 consignments from Bangladesh have been exported through this route.

Before the facility was withdrawn on Wednesday, 11 consignments were transported to Kolkata Airport via Benapole on Monday. Following the cancellation, India’s Petrapole Customs returned four garment-laden trucks on Thursday.

There is an annual demand for more than 200,000 tons of garment exports by air. Until now, 80–85 per cent of this volume was transported through Dhaka’s Shahjalal Airport, while the remaining 15–20 per cent was routed through Kolkata Airport in India. With the cancellation of the Indian facility, 100 per cent of air shipments will now have to pass through Shahjalal Airport.

Kabir Ahmed, president of the Bangladesh Freight Forwarders Association—an organisation representing businesses responsible for delivering goods to foreign buyers—told Prothom Alo that the cargo handling capacity at Shahjalal Airport falls short of the current demand. In the past, airlines faced payment delays due to the dollar crisis, leading to a reduction in flights. Additionally, operating costs, including ground handling charges, are higher at Shahjalal compared to Kolkata. As a result, air freight costs from Dhaka are slightly higher.

Kabir Ahmed added that if the capacity of Shahjalal Airport is increased, it will be possible to handle the additional pressure caused by the closure of the Kolkata route.

According to Benapole Customs, although exports via Kolkata reached 23 countries, the majority of shipments were bound for Spain. Inditex, the second-largest clothing buyer from Bangladesh, was the most frequent user of this route.

Bangladesh’s largest volume of ready-made garment exports is handled through the Chattogram port by sea. However, sellers of fast fashion prefer air transport to ensure quicker delivery. During the Red Sea crisis, foreign buyers also opted for air shipment.

Speaking to Prothom Alo, Mostafizur Rahman, a distinguished fellow at the research organization Centre for Policy Dialogue (CPD), said the cost of air shipment from Kolkata Airport is lower than from Dhaka. He emphasised the need to review why air transport costs are higher from Dhaka. Reducing air freight costs from Dhaka, he noted, would enhance the competitiveness of Bangladesh’s garment exports. He also stressed the importance of continuing bilateral discussions with India to avoid disruptions in the garment sector.

Meanwhile, Trade Advisor Sheikh Bashiruddin told reporters at the Secretariat yesterday, “Even though India suddenly cancelled the transshipment facility, it will not create problems for Bangladesh. We will try to manage the situation through our own efforts.” He added that work is underway to improve infrastructure and manage costs accordingly.