Bangladesh cancels $21m defence deal with state-owned firm in India

DHAKA/NEW DELHI: Bangladesh has terminated a $21 million defence contract with an Indian state-owned enterprise under the Ministry of Defence, Garden Reach Shipbuilders and Engineers Ltd (GRSE). The contract included supply of an advanced ocean-going tug, Dawn News reported on Sunday.

The order, initially placed in July 2024, has now been formally annulled by the Bangladeshi government. The Indian media has also reported the cancelation of the deal, which comes amid growing signs of strain in India’s foreign relations.

GRSE disclosed the contract cancellation in a regulatory filing with India’s National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).

The souring of the bilateral ties with Bangladesh in particular happened after India’s decision to revoke a transhipment facility which allowed Bangladeshi cargo to travel through Indian ports. Moreover, the change in government in Bangladesh has also triggered a shift in state decisions, moving away from the pro-India stance of the ousted leadership under former prime minister Sheikh Hasina in August 2024.

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