India finished on top of the table after second consecutive victory in the three team group. Following their wins over Sri Lanka, India and Bangladesh had already qualified for the semifinals.
India will now meet Afghanistan, the runner up of group A in the semifinal. Nepal will lock horns with Bangladesh on Saturday.
Bedashwor Singh fired India ahead in the 43rd minute with a superb freekick taken from the 20 yard to stun Bangladesh. Krishna Pandit killed the match in the dying moments with a well placed shot from the left side of danger zone in Prosenjit Chakroborty pass.
"I am proud of the way the team played today," Bangladesh coach Koster Rene said at the post match conference. "They fought like tiger. India has more qualified players than us."
India coach Goutam Ghosh reiterated their main aim was to develop the team rather than win. He expressed satisfaction with the improvements his side made in defense line up.
Impressive Nepal thumps Bangladesh 2-0 to reach SAFF semis