BANGLADESH
Agriculture Trade Between India and Bangladesh: A Growing Partnership
India and Bangladesh, two neighboring countries with rich agricultural heritages, have built a strong foundation of bilateral trade over the decades. Agriculture plays a central role in this trade, driven by demand, proximity, and shared agro-climatic conditions. Among the various agricultural products exchanged, peanuts (groundnuts) have emerged as a key commodity due to rising demand in food processing, oil extraction, and livestock feed industries.
In this blog, we explore the current state of agriculture trade between India and Bangladesh, with a spotlight on the peanut trade, including varieties, volume, and the growth potential for exporters and importers.
Overview of Agriculture Trade Between India and Bangladesh
Key Highlights:
- Bangladesh is one of the top agricultural trade partners of India in South Asia.
- India's agricultural exports to Bangladesh crossed USD 1.3 billion in 2023, comprising rice, wheat, onions, spices, fruits, vegetables, and peanuts.
- Bangladesh imports various agro-commodities to meet domestic demand and supplement local production, especially during lean periods.
Major Agricultural Products Traded:
From India to Bangladesh:
Rice, wheat, maize, onions, spices, cotton, peanuts, sugar, and oilseeds.
From Bangladesh to India:
Lentils, jute, tea, and vegetables (on a smaller scale).
Peanut Trade Between India and Bangladesh
Why Peanuts Are in Demand in Bangladesh:
- Rising demand from oil mills, snack manufacturers, and animal feed processors.
- Increased use in peanut butter, confectionery, cosmetics, and pharmaceuticals.
- Growing population and changing dietary habits are driving consumption.
Types and Varieties of Peanuts Exported from India
India produces a wide range of peanut varieties suitable for different applications:
Bold Peanuts (Virginia type)
- Large kernels, red skin.
- High oil content, ideal for direct consumption and oil extraction.
- Popular in Bangladesh for peanut butter and roasting.
Java Peanuts (Spanish type)
- Small to medium kernels, pinkish skin.
- Sweet taste, mostly used in confectionery and snacks.
TJ Peanuts (Tala-Jawahar)
- Hybrid of Java, premium quality.
- High yield and uniform size, widely exported.
Blanched Peanuts
- Skin removed, ready for value-added use in food industries.
Peanut Export Volume and Growth from India to Bangladesh
Recent Trade Statistics:
- In FY 2023-24, India exported over 75,000 metric tons of peanuts to Bangladesh, valued at USD 85 million.
- Exports have grown at a CAGR of 12% over the last five years.
- The port of Petrapole-Benapole handles the largest share of peanut trade via land.
Key Peanut Exporting States in India:
- Gujarat, Andhra Pradesh, Tamil Nadu, and Karnataka are major contributors.
- Gujarat alone accounts for more than 30% of India's total peanut exports.
Trade Opportunities and Future Outlook
Opportunities:
- With rising food processing units in Bangladesh, demand for raw and semi-processed peanuts is set to increase.
- Favorable freight costs via land transport make India a cost-effective supplier.
- India's high peanut production (over 9 million metric tons annually) ensures a stable supply.
Challenges:
- Trade delays due to customs and logistics at the border.
- Quality certification and pesticide residue norms.
Solutions & Recommendations:
- Adoption of agricultural export hubs in Indian states for quality standardization.
- Use of APEDA (Agricultural and Processed Food Products Export Development Authority) support for exporters.
- Digital documentation and blockchain-led supply chain solutions can streamline trade.
Conclusion
The agriculture trade between India and Bangladesh is a testament to the deepening economic and food security partnership between the two nations. Peanuts, as a high-demand commodity, are playing a pivotal role in this trade landscape. With improved logistics, quality control, and bilateral trade agreements, the peanut trade is expected to scale new heights in the coming years.