Phytoplankton in the marine environment exudates part of the primary production as dissolved organic carbon (DOC) into the surrounding waters. The rate of exudation of DOC is depended on the hydrographic condition, nutrient availability, phytoplankton composition, and their size structure. To examine this, samples were collected from the coastal and offshore regions where different hydrographic conditions exists in the Bay of Bengal. The coastal waters were relatively low saline, rich in inorganic nutrients, high phytoplankton biomass (Chl-a) and primary production in the coastal compared to offshore regions. The photic zone integrated Chl-a displayed insignificant difference between coastal and offshore regions whereas higher photic zone integrated primary production was observed in the former than latter region. Dominance of microplankton was observed in the coastal waters associating with high inorganic nitrogen concentrations, in contrast, picoplankton dominated in the offshore region associating with low inorganic nitrogen but high organic nitrogen concentrations. Due to high surface-to-volume ratio of picoplankton, ∼45% of the primary production exudated as DOC in the offshore compared to the coastal region (∼12%) due to dominance of microplankton. The sum of primary production and DOC exudation, called total primary production, was almost equal in the coastal and offshore regions. The mean phytoplankton biomass normalized primary production (pB) in the Bay of Bengal was low (17 ± 8 mgC mgChl-a−1 d−1) compared to Arabian Sea (37 ± 5 mgC mgChl-a−1 d−1). In contrast pB estimated based on total primary production is close (30 ± 16 mgC mgChla−1 d−1) to that of the Arabian Sea (37 ± 5 mgC mgChl-a−1 d−1) suggesting that the Bay of Bengal is equally productive compared to that of Arabian Sea than hitherto hypothesized due to strong stratification and less nutrients input in the former basin. The low sinking carbon flux observed below the photic zone is attributed to the release of primary production as DOC. The released DOC from the phytoplankton may support heterotrophic activity as evidenced by the existence of strong net heterotrophy in the Bay of Bengal. This may lead to the time lag between primary and export productions. None of these processes were incorporated into the numerical models resulting in inaccurate simulations of carbon cycling in the northern Indian Ocean. Modifications in the models by incorporating these processes may improve model simulations for a better understanding the modifications in biogeochemical processes due to climate change in the Bay of Bengal.