The New Horizon

A new world explored with a rational view

Refusing Transit to India : Is Bangladesh missing something?

with 16 comments

In part one of this series of blogs covering Bangladesh refusal of UNESCAP to join under their plans, I would like to put my view on the contensious transit issue.

What is this transit issue altogether?
The transit for a country is mainly access through a country to the third one. For example, India has a transit to Afghanistan through Iran. So, Indian goods can board from Iranian ports and go through to Afghanistan. However, due to geographical complexity, in this case, the transit refers to connectivity between North-East Indian seven states with mainland India, especially West Bengal. The goods carried from North East, comes to mainland India through a strip of Assam and North Bengal, taking a route miles longer than what could have been a shortest through Bangladesh. Bangladesh govt. never allowed India to have a transit in return of a hefty transit fee offerred by India. The transit, that could have been a win-win situation, has been refused as a threat to National security. The other point of interest here could be the transhipment. Here, Transit refers to the passage across Bangladesh territory of Indian goods to and from the north Eastern states of India using Indian owned surface transport, while transhipment refers to the same movement using Bangladesh-owned transport.

History
The transit was used by India till 1965 war, since then it got stopped. The war was between India and Pakistan. In the mean time, Pakistan broke, Bangladesh was born, but situation remained unchanged. Though after independence, Bangladesh allowed India the transit in air-routes and river, the major issue of road-transit is still not tackled. The river-transit is almost abandoned for being incompetitive, the mutual air-transit is still in use.

Transit – How India gains out of it
The main gainer of this whole process would be the people of North-East of India. Right now, anything produced in that region can not be marketed in the rest of India, due to the distance from port (Kolkata). From past decade, India is becoming more dependent on foreign and private investments in growth picture. But, no company will want to invest in this remote corner of the Northeast, because of the logistical problems of Sevens Sisters linking in with the rest of India. So the only real economic future of Northeast lies in reopening its route through Bangladesh to its West and with Myanmar and South-East Asia to the East. For additional benefit, if they are allowed to use a Bangladesh port, the export oriented business can also come up in this region. The region is rich in energy resources, like natural gas and hydro-electricity. The economic progress in this region can stop a long-standing grievence and insurgency resulted.

Transit – How Bangladesh gains out of it
The gain of Bangladesh can be manyfolds.

1. How Bangladesh can become a regional transport hub, was described by ADB Country Director Hua Du in a seminar recently. She mentioned – “You can benefit tremendously through opening up transit and great opportunities for crossing from east to west and giving the land-locked neighbours access to the sea”.The Chittagong port can become a modern busy port like Singapore serving the SAARC countries and even China. Huge foreign investment may be attracted to Bangladesh and finally a throbbing service sector like banks, insurance, hotels, rest houses, petrol pumps etc. may develop around the Trans continental roads and railways.
2. There is an estimate of direct economic gain from transit fees. It ranges from 500 crore taka to 4,666 crore taka.
3. The last but not the least, is the mutual transit. Bangladesh, in return, will get a much shorter route to China, which already is its second largest trading partner. Unfortunately, most of the trading nowadays takes place through sea-route. The cost of import increases, as well as Bangladeshi goods loose competitiveness in Chinese market. If Bangladesh wants to access South Chinese underdeveloped market, they must go through India. This was a point of concern for the Chinese delegates during Kunming initiative in 1999, an initiative to link Chinese province of Yunan with Seven Sisters of India, Myanmar, Thailand and Bangladesh. See reference map to link Kunming in China with Bangladesh.


The potential damages Bangladesh could suffer

1. The corridor through Bangladesh could increase Indian Intelligence Service activities in Bangladesh.
2. It could lead to spreading of AIDS and could become a potential route for drug-trafficing.
3. The road and ports of Bangladesh could get overcrowded, thus resulting in poor efficiency in domestic industries.

Keeping in view the benefits, it seems the above mentioned risks are too small, from economic perspective. But, a country is not made up of its economy only, it has its political, ideological and popular faces also. To sum up the whole condition, Bangladesh currently does not allow India the transit because of non-economic reasons.

Conclusion

The entire article views the issue of transit as a bilateral matter, not a multilateral one. The problem complicates when the same issue becomes a multilateral one, crops up as a part of a multilateral development program. Unfortunately, Bangladesh has refused to join Asian Highway project fearing it would allow transit to India. The anti-India bias of the Bangladesh foreign policy has come out once more.

The future of the economy of a country depends on how the policies remain focused on economy overcoming the political pressure. This is a proven truth in case of China, Japan and might be India in near future. Hence, giving up economic advantages to some non-economic causes will never help a poor country in a poorest region to grow out of its poverty. Hope, the leaders of Bangladesh will understand these, the sooner the better.

Another article on the same topic can be found here, but that is in Bengali.

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Written by Diganta

January 2, 2006 at 6:08 am

Posted in Uncategorized

16 Responses

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  1. The black background that you have used for your article is an eye sore. I could not read it, as doing it, meant harming my eyesight.

    Can you change the background so that readers could read your article?

    Anonymous

    January 3, 2006 at 4:55 am

  2. Thanks for your feedback, I’ll certainly do it.

    Diganta

    January 3, 2006 at 6:34 am

  3. The seven non indian sisters depend upon Bangladesh for manufactured goods. If Bangladesh gives transit to India then this business for bd would b gone as India would be able to sell off its products in those regions. i gyuess losing a trade prospect would not b wise

    Zoheb

    February 4, 2009 at 6:34 pm

  4. The seven non indian sisters depend upon Bangladesh for manufactured goods.

    – Are you sure about that? What I know is that those states get their manufactured goods via Siliguri-Assam. Do you have an import-statistics on this particular point?

    Diganta

    February 5, 2009 at 3:58 am

  5. india & bangladesh worked like brothers in 1971 liberation war. both of them were gainer & it’s not only bangladesh. india benefitted as pakistan got divided. (now india is against liberation!!).

    well, what compelled bangladeshis to go against india ?
    use common sense.
    just after the war india took away just whatever they could from bangladesh. there is a proverb that the then bangladesh was a bottomless basket. whatever donation would reach bangladesh, it would leak through to india.

    well, india yet didn’t meet the demand of natural-water-supply-problem, bay-of-bengal bordering problem, bangladesh’s demand for transit to nepal, bhutan, china. fact is, many more of such.

    now india is interested only at the agreement where they will be benefited. there are still questions if in long term perspective, bangladesh will be gainer out of this agreement.
    india is like an elder brother of bangladesh. and india is behaving like a little boy. their demand must be met first.

    other mutual problems/demands should also be met before india can think of only herself.

    there should be true friendship so that both are mutually benefitted.

    Anonymous

    February 5, 2009 at 11:18 pm

  6. india shouldn’t leave bare/empty handed. fact is, other problems should also be considered.

    Anonymous

    February 5, 2009 at 11:29 pm

  7. Fact is that India has problem set A, Bangladesh has set B. Both claim there ones are more important than the others. And they stand locked with little progress.

    If you think Bangladeshis go against India because of these issues – think again. None of these were there in 1971, still transit was not granted. The root of India-Bangladesh problem is the legacy of two nation theory and the geography of Bangladesh.

    By the way, if you think two bordering countries won’t have a problem with each other, you’re living in a Utopia. They will always have problems. I suggest India and Bangladesh to take international route to resolve all these issues – Asian Highway was one such rare option.

    Diganta

    February 6, 2009 at 1:07 am

  8. (my above comments was mainly based on history & other problems. not transit alone)

    thanks much for your positive approach.
    i think both of them should follow international rules & regulations very strictly.

    [ & one’s thoughts shouldn’t be centered around economy alone. high economic activity is decreasing longevity of earth. high economic activity isn’t a problem as long as longevity of earth isn’t affected. there is certain limitation of resources that earth can offer to us. we must enjoy her(earth) accordingly. ]

    well, there is another agreement named TIFA with usA. if it’s implemented quickly then ICT of the country may crash just overnight. it should aslo be implemented but not so quickly unless peoples are (quickly) motivated & habituated to use open source softwares.

    (i know i am out of context for a while. sorry.)

    hld

    February 6, 2009 at 8:39 am

  9. not sure if I am right all through.
    people will decide.

    take care.

    hld

    February 15, 2009 at 12:25 pm

  10. This is absurd that one can suggest a range of direct financial benefit ranging between 500 Crore to 4666 Crore. A range this wide open is far from any scientific economic analysis. This is all politics to dupe the readers.

    Raj

    February 24, 2009 at 5:28 am

    • yeah the analysis is true. In initial year the revenue won’t be profitable, if you consider long term like for 10 to 15 years the profit would be far better, if you feed proper investment to develop infrastructure. Wait for reliable info and also check ” http://www.thedailystar.net/newDesign/news-details.php?nid=160691 “/ And the infrustructure would be also benificial to Bangladesh’s GDP. because generally 12% increase in investment in infrastructure will wil increase the GDP 1% ! This isn’t a “all politics to dupe the readers”, i think you are a biased reader.

      ankur

      January 3, 2011 at 11:17 pm

  11. One analysis cannot propose such wide range but multiple analysis can.

    Diganta

    March 1, 2009 at 12:21 pm

  12. Nice article to get an overview of transit issue although very few statistics…..
    Over all a good work

    mafiq

    September 6, 2011 at 12:00 pm

  13. Good one, Definitely Bangladesh is going to miss a lot. Gain and loss is equally there in both the end but still India have to save something from them. Good Article friend. thank you for sharing.

  14. if india gives west bengal thats western part of bangladesh to bangladesh than bd shall provied transit to india.

    sakib

    December 12, 2013 at 12:16 pm

  15. Hey! Do you use Twitter? I’d like to follow you if that would be okay.

    I’m undoubtedly enjoying your blog and look forward to new posts.

    k53 learners

    February 13, 2014 at 7:28 am


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