Indian ports play an important role in the country’s economy by handling imports and exports. In recent years, their role has expanded to include something even more critical – helping India build and strengthen relations with its neighbouring countries. Today, Indian ports are not just trading points; they are important assets for ensuring regional cooperation, improved connectivity and diplomacy. Moreover, India’s efforts to promote green shipping corridors reflect its commitment to sustainability. Indian ports are rapidly becoming gateways to regional and global cooperation, supporting both economic growth and environmental responsibility.
Supporting trade with Bangladesh
The Protocol on Inland Water Transit and Trade agreement between India and Bangladesh has strengthened bilateral ties by facilitating inland waterways connectivity and trade. This agreement, in place since 1972, allows boats from both countries to use specific river routes to move goods. Over time, this has helped reduce transport time and costs, especially for cargo going to India’s Northeast region.
The ports of Kolkata, Haldia and Dhubri in India are important parts of this route. Goods can be transported from central India or the east coast to Bangladesh and then to Tripura, Assam and other north-eastern states. For example, cargo going from Kolkata to Agartala in Tripura can travel via Bangladesh much faster than going through India’s narrow Siliguri corridor. In another upcoming development, Tripura will be connected with Kolkata, Visakhapatnam and Paradip through the Bay of Bengal once full-scale inland waterways connectivity with Bangladesh becomes operational.
In April 2025, the Indian government withdrew a special facility that allowed goods from Bangladesh to be sent to third countries like Nepal and Bhutan through Indian land borders. Bangladesh exporters are now required to use Indian ports like Haldia, which increases logistics costs for them. During 2023-24, the value of trade between India and Bangladesh stood at around $13 billion, with Bangladesh exporting about $2 billion worth of goods to India. India’s exports to Bangladesh are more than four times higher, resulting in a large and persistent trade surplus. While this move may benefit Indian ports, it could also increase imbalance in regional trade if not handled with care.
Growing ties with Myanmar
India’s trade with Myanmar is also growing, and ports are playing a central role in this. The Kaladan Multimodal Transit Transport Project connects the port of Kolkata with the newly built Sittwe Port in Myanmar by sea. From Sittwe Port, cargo moves through inland waterways on the Kaladan river to Paletwa in Myanmar, and then by road to Mizoram in India.
This route will provide India’s north-eastern states better access to the sea. The project is expected to be completed by July 2025, with most of the road section already completed. Once operationalised, it will help move goods faster and support development in India’s Northeast region while improving ties with Myanmar.
Meanwhile, discussions are under way between India and Myanmar to adopt a local currency trade settlement mechanism. Trading in local currencies would reduce transaction costs by eliminating the need to convert currencies twice. India and Mauritius have already decided to facilitate trade settlements in local currencies, namely the Indian Rupee and the Mauritian Rupee. Furthermore, India is planning to promote trade in local currencies with various other countries, including the UAE, African nations and Russia.
Other key collaborations
India’s neighbourhood-first policy has fostered regional ties. In alignment with this policy, the Northeast region has provided significant opportunities to enhance tourism, trade and connectivity with neighbouring countries. Notably, the Dodhara Chandani dry port in Nepal is set to become a major logistics hub. RITES Limited has been awarded a tender to construct the dry port. It will streamline the movement of goods between Nepal and India, significantly reducing transit time and cost. It will also provide the northern region with access to the Jawaharlal Nehru Port in Mumbai. The untapped trade potential between the two countries stands at 76 per cent.
India’s maritime collaboration with Oman has been reinforced through the allocation of a specific zone to India within the strategically located Port of Duqm. This development enhances India’s role in the western and southern Indian Ocean region, providing a strategic foothold near the Strait of Hormuz, a critical chokepoint for global oil shipments.
Back in May 2024, India and Iran signed a 10-year agreement to develop and operate the Chabahar port. Following that, in March 2025, India committed an investment of nearly Rs 40 billion to expand operations at the port, aiming for a five-fold increase in capacity to 500,000 twenty-foot equivalent units (TEUs) over the next decade. To support this expansion, orders for five mobile harbour cranes have been placed. A second berth is also under consideration for expanded operations. The port is projected to handle 100,000 TEUs by 2025-26, reaching near-full capacity. This partnership aims to enhance regional connectivity and facilitate transit along the International North-South Transport Corridor, providing India with direct access to Afghanistan and Central Asia while bypassing Pakistan.
India’s involvement in Sri Lanka’s port infrastructure is exemplified by the development of the West Container Terminal at Colombo Port. The terminal commenced operations in April 2025. The Colombo West International Terminal project, a $800 million investment, will be South Asia’s first fully automated deep-water terminal. Featuring a 1,400 m quay and 20 m draft, the facility will handle 3.2 million TEUs annually, significantly enhancing cargo efficiency and positioning Colombo as a premier regional transshipment hub. This project is managed by a consortium, including Adani Ports and Special Economic Zone Limited (APSEZ), John Keells Holdings and the Sri Lankan Ports Authority, aiming to enhance shipping capacity and transform Colombo into a significant logistics hub.
Strengthening the IMEC
The India Middle East Europe Economic Corridor (IMEC) is a proposed transcontinental trade route connecting India to Europe via the Middle East. This corridor aims to bolster economic development by fostering connectivity and economic integration between Asia, the Persian Gulf and Europe. Key ports involved include Haifa in Israel, which is being developed as a central hub under the ownership APSEZ, and ports such as Mundra and Kandla in Gujarat and Jawaharlal Nehru Port Trust in Navi Mumbai on India’s west coast. In the Middle East, the ports include Fujairah, Jebel Ali and Abu Dhabi in the UAE, along with Dammam and Ras Al Khair in Saudi Arabia. Once operationalised, it will reduce logistics costs by 30 per cent and transportation time by 40 per cent.
Pushing for greener shipping
The shipping sector contributes significantly to carbon emissions, and countries around the world are exploring ways to reduce pollution in this industry. In addition to helping trade, Indian ports are also part of a larger shift toward cleaner and greener shipping.
India has committed to developing green shipping corridor routes that will support ships powered by cleaner fuels like green hydrogen, ammonia or liquefied natural gas. The aim is to reduce emissions from ships and port operations. Many memorandums have been signed for the same. In a major development during the Singapore Maritime Week in March 2025, India and Singapore signed a letter of intent to collaborate on a green and digital shipping corridor. This project aims to promote the adoption of low-emission technologies, maritime digitalisation and resilient logistics systems. According to the Ministry of Ports, Shipping and Waterways, the partnership will formalise efforts through an MoU and identify key stakeholders for implementation. This initiative will drive innovation, strengthen digital integration and accelerate sustainable practices by combining India’s strengths in IT and green fuel production with Singapore’s role as a global maritime hub.
In April 2025, India and the Netherlands laid the foundation for a green and digital maritime corridor between the Port of Rotterdam and Indian ports such as Deendayal Port Authority, Kandla. Further, discussions were held focusing on facilitating the export of green hydrogen and its carriers (ammonia and methanol) from India to Europe via the Port of Rotterdam. India is also in talks with the UAE and the UK for similar green corridor plans in the Indian Ocean region.
Looking ahead
Indian ports are becoming central to the country’s broader foreign policy and economic strategy, playing a significant role in strengthening regional and global trade ties. The increasing collaboration with countries such as Nepal, Myanmar, Sri Lanka, Iran and Oman highlights the strategic importance of Indian ports in enhancing connectivity and trade. With investments in port infrastructure and a focus on both regional and global partnerships, Indian ports are positioned to serve as crucial hubs that drive the country’s economic aspirations while supporting international cooperation and sustainable development.