Impact of Bangladesh Garment Exports on Indian Shippers

 Impact of Bangladesh Garment Exports on Indian Shippers

The hindu editorial

Air Cargo Congestion and Space Shortage

• Bangladesh's garment exports via Delhi's IGI airport have led to a significant increase in air cargo volume, causing congestion and space shortages.
• From April to December 2023, Bangladesh accounted for only 2% of cargo handled at Delhi airport, but by March 2024, this increased to 9%, causing spikes in air freight rates by nearly 300%.

Challenges Faced by Indian Exporters

• Indian exporters are struggling to secure space on aircraft for their shipments, often needing to pay premiums to secure cargo space.
• The diversion of Bangladeshi exports through Delhi airport has worsened logistical challenges and increased transportation costs for Indian apparel exporters.

Calls for Government Intervention

• The Federation of Indian Export Organisations (FIEO) proposes imposing a "landing charge" on Bangladesh cargo to prioritize Indian air cargo and reduce freight burdens.
• The Apparel Export Promotion Council (AEPC) urges the government to suspend transshipment of Bangladeshi export cargo through Delhi's air cargo complex to protect local industry competitiveness.

Impact on Air Freight Rates and Competitiveness

• Prolonged disruptions in cargo movement due to geopolitical issues (such as the Red Sea crisis) have forced Indian exporters to shift to more expensive air modes.
• The movement of Bangladeshi cargo through Delhi airport exacerbates delays, congestion, and higher air freight rates, affecting the competitiveness of Indian exporters.

Global Air Cargo Challenges

• The disruption in access to the Suez Canal has impacted Asian exports, leading to worldwide congestion at airports and steep increases in air freight rates.
• Airlines globally lack sufficient belly space to accommodate increased cargo diversion, exacerbating space constraints and rising freight costs.

Conclusion

The influx of Bangladesh garment exports through Delhi's IGI airport has created significant challenges for Indian exporters, including congestion, space shortages, and increased air freight rates. Urgent government intervention is sought to address these issues and safeguard the competitiveness of India's apparel export industry.