Bangladesh-China relations: Advancing on firm footings

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by Serajul Islam     9 January 2022

Bangladesh-China relations are excellent at present. Better still, they are on an ascending trajectory. In a country where all relations in the public domain are reflected and judged in the context of the country’s glorious War of Liberation of 1971, Bangladesh-China relations are an exception. China had opposed the War and supported the Pakistani military regime. China had also vetoed Bangladesh’s UN membership in 1972 and 1973. China used the veto to placate Pakistan which was during that period acting as its go-between for normalization of its relations with the United States that eventually launched China’s journey from a low-income developing country to its present position as the second strongest economy of the world.

Bangladesh became a member of the UN on 17 September 1974 after China withdrew its veto. China recognized Bangladesh on 31 August 1975 following the August 15, 1975 change of government in Bangladesh. The two countries established diplomatic relations in January 1976. They have not looked back since then for enhancing their bilateral relations. Today, Bangladesh’s best bilateral relations are with China. There are no major issues of discord or disagreement between them. China’s opposition to the Bangladesh War of Liberation and vetoes against Bangladesh in the UN, therefore, appear to be aberrations given the excellence and strength of present-day China-Bangladesh bilateral relations.

Defence cooperation deepens

China also grasped fully the military’s importance as a major stakeholder in Bangladesh’s politics, in power or outside it, having led Bangladesh’s War of Liberation from the front. China, therefore, chose defence cooperation as the strategy for the foundation of its bilateral relations for the first 15 years while the military was the major stakeholder in Bangladesh’s politics and China was still a developing country with the military and defence production, its major strengths. China became the major supplier of arms and armaments of Bangladesh’s military during this period, providing these at prices that no other country could match.

Today, China supplies nearly 80% of Bangladesh’s defence equipment, a dominance established during President Zia and President Ershad’s terms and maintained all along. In between, China also became a major trainer of Bangladesh’s military personnel and still retains that position.  In 2019, India had offered a US$ 500 million line of credit to Bangladesh for defence purchases to compete with China, keeping in view the political importance of the military in Bangladesh. The offer just lapsed with no interest from Bangladesh. In the final stages of the Trump administration, Defence Secretary Mark Esper had called Sheikh Hasina for arms sale to Bangladesh. That too lapsed with the end of President Trump’s tenure. China thus has the best of relations with the Bangladesh military among all the countries that conducts foreign relations with Bangladesh.

 Economic relations expand

 Chinese imports to Bangladesh thus rose a walloping 31% of Bangladesh’s overall imports in 2019 which was “more than double the imports from the next largest partner” that was India. Imports from China increased 16-fold in the last two decades. Chinese imports to Bangladesh are ever-increasing and include textiles, machines, refined petroleum and manufacturing items of a very wide variety. In 2016, China’s export to Bangladesh was worth US$ 15.16 billion and in 2019, the trade deficit in China’s favour was US$ 16.17 billion! The diagram below reflects Bangladesh-China trade figures, and their dramatic growth; the balance heavily in favour of China and the dramatic flow of FDI from China:

 

To address trade imbalances, China allowed from 1st July 2021, 5161 new Bangladeshi items duty-free access to its market to join 3000 plus items already allowed such access. This will provide 97% of Bangladeshi exports to China duty-free access, 70% of which are textiles. China has provided duty-free access to Bangladesh as a Least Developed Country (LDC). China is also leading other countries at present in foreign direct investment or FDI in Bangladesh. Chinese FDI in Bangladesh in 2015 was a mere US$ 49.8 million that dramatically rose to US$ 1159.42 in the 2019 FY that underlined, first China’s rise as a world economic power and, second, Bangladesh’s clear drift towards China.

China introduced to the world in 2013 through President Xi Jinping its “One Road One Belt Initiative” (BRI) to connect as much of the world as possible through road and sea connectivity. Seventy per cent of the world’s population mainly in the developing world has been connected by the BRI. Bangladesh joined China’s BRI initiative in 2016 aware that India was not favourably disposed towards the initiative. Bangladesh’s decision to join China’s BRI initiative indicated, first, Bangladesh was ready to allow strategic areas to enter into Bangladesh-China relations; and second, China was no longer wary of India’s sensitivities about its interest in strategic issues or projects in Bangladesh.

Thus, China won the bid to build the strategic US$ 250 million Sylhet International Airport that New Delhi fought tooth and nail to stop but failed. The Indian High Commissioner Riva Ganguli waited for months to meet Sheikh Hasina to win the bid for Sylhet Airport but failed to meet her. She returned to New Delhi prematurely thereafter. Today there is hardly a mega economic infrastructure under construction in Bangladesh that is not aided by Chinese technology, loan, or some form of financing. India is now trying very hard to stop China from winning its bid for the US$1 billion Teesta Project that is situated in an area that is strategically the most important for India. If China gets the Teesta Project, it would signal that Bangladesh has finally drifted away from India and shifted towards China. 

China’s waiting game wins

China’s strategy for pursuing its bilateral relations with Bangladesh has been built with a long-term vision for the attainment of its strategic objectives in Bangladesh and the region. India has thus figured very importantly in the vision for many obvious reasons. China has been conscious of India’s importance in Bangladesh, historically in the context of the War of Liberation, and geopolitically in the context of a host of other very critical factors. China never forgot that it had to wait for the pro-India AL to yield power to establish diplomatic ties with Bangladesh. India’s sensitivities have thus always been in China’s perspective while developing and enhancing its ties with Bangladesh.

China’s vision of its bilateral relations with Bangladesh neither exposed nor expressed its strategic goals in Bangladesh in the first 4 decades of their development and enhancement; but it did not mean that China had no such interests. It of course had deep-rooted strategic goals in Bangladesh. China nevertheless knew that India would use its influence in Bangladesh under any government in Bangladesh and stranglehold under the Awami League, to derail its bilateral relations with Bangladesh if India’s strategic interests in Bangladesh were compromised or threatened by China. China was convinced in its vision that the denial by India of Bangladesh’s legitimate interests related to water sharing and border killings, etcetera and the rise of Hindutva, would give rise to anti-India feelings in Bangladesh on a bipartisan basis that would eventually lead to a shift in Bangladesh away from India and towards China without China actively encouraging such a shift. China thus chose to wait for these developments to occur on their own.

Bangladesh was on the road to democracy when China started its transformation into an economic powerhouse in the early 1990s that allowed China to use trade, investment and other economic areas of cooperation to strengthen and enhance its defence relations with Bangladesh. China again stayed out of Bangladesh’s politics and refrained from coming between Bangladesh and India in pursuing the new areas of cooperation in economic relations. China quietly watched the BNP, which was overtly pro-China and anti-India, come to power in 1991-96 and 2001-2006, but made no attempts to come between Bangladesh and India conscious that the latter could derail the development and enhancement of its relations with Bangladesh.

China was already the world’s number two economic power by the time the Awami League came to power in January 2009.  China nevertheless knew Bangladesh-India relations had entered into its best phase ever with the Congress in power in New Delhi. China, therefore, refrained more than ever from coming between Bangladesh-India relations during this period.  The Chinese objective during this period was to create confidence in New Delhi that its relations with Bangladesh would be limited to trade and economic issues and that it had no intention of pursuing any strategic goals in Bangladesh that India did not want. China thus built its economic relations with Bangladesh more aggressively between 2009-2014. China’s policy limiting its relations in Bangladesh in trade and economic affairs allowed China-Bangladesh relations to grow more strongly even when the BJP government came to power in New Delhi in 2014.

China thus did not jump in delight when opportunities arose for it to pursue its strategic goals in Bangladesh following the defeat of the Congress to the BJP led by Narendra Modi with the mantra of Hindutva in April/May 2014.  Prime Minister Sheikh Hasina hurriedly visited China in June 2014 apprehensive that the new Indian government would not back the controversial January 2014 elections in Bangladesh that had brought her party to power for a second successive term that the Congress had actively backed. Sheikh Hasina flagged her fear by undertaking that visit to China even before establishing any contact with the new Indian government that was extremely unusual given the extreme closeness of Dhaka-New Delhi relations in the 2009-2014 period.

Bangladesh offered China several strategic projects during that visit of Sheikh Hasina that underlined its desire to shift away from Delhi and towards Beijing. The all-important Sonadia Deep Sea project that China wanted very much that India opposed was also discussed although the project was not included in the Joint Statement issued following the conclusion of the visit. Bangladesh later retracted from most of the offers following the Indian External Affairs Minister Sushma Swaraj visited Dhaka immediately after Sheikh Hasina returned from Beijing and Narendra Modi visited Dhaka the following year.

China did not force its hands-on Bangladesh. It did not want to embarrass Sheikh Hasina either. It also felt that Bangladesh was not yet ready to shift towards China and Sheikh Hasina’s move towards Beijing was a knee jerk reaction borne from fear that the BJP government would not back the January 2014 election in Bangladesh and it needed China to back that controversial election internationally. Thus, the Chinese President Xi Jinping on his visit to Dhaka in 2016 simply flagged that Dhaka had retracted most of the offers it had made during Sheikh Hasina’s visit to Beijing in 2014.  Beijing nevertheless was confident that if it waited a while longer, Dhaka would eventually come under its sphere of influence without its interference because of Hindutva and rising anti-Indian sentiments in Bangladesh on a bipartisan basis.

“Debt-trap” scare-mongering

Reports in the mainstream media suggest such a drift and shift is underway in the contexts of Bangladesh-India and Bangladesh-China relations. These reports are consistently harping that Bangladesh has, like Sri Lanka, walked into China “debt trap”. These reports no doubt orchestrated officially by India are fearmongering tactics by India to create a wedge in Bangladesh-China relations. They nevertheless underline the fact that India itself is now fearful that Bangladesh is drifting away from it and towards China.

Independent economic analysts who have examined and analysed India’s fearmongering over the so-called “debt trap” issue have however dismissed the “debt trap” assessment with valid reasons giving credit instead to Bangladesh for successful “economic diplomacy” that have brought extensive Chinese loans for Bangladesh’s economic development. The fear-mongering in the Indian mainstream media thus suggested an upward trajectory of the development Bangladesh-China relations and a downward one for Bangladesh-India relations and India’s apprehensions over these developments.

The fearmongering has flagged that India has failed to admit what was otherwise evident that the downward trend of its relations with Bangladesh and the upward trend in Bangladesh-China relations has been primarily its own doing. It had pushed Bangladesh towards China by declining to support the AL in the 2018 Bangladesh national elections as it had done in 2014. And the BJP government had used the Hindutva mantra to energize the BJP’s base against Bangladesh as an overwhelmingly Muslim majority country. Instead, New Delhi used unsuccessfully Narendra Modi’s friendship with President Trump to influence USA to woo Bangladesh to join the anti-China military alliance QUAD comprising India, USA, Japan and Australia.

The US defeat in Afghanistan and geopolitics

The Biden administration has also been trying to come between Bangladesh and China with QUAD. President Biden held a virtual QUAD summit in March to expand QUAD prompting a visit of the Chinese Defense Minister General Wei Finghe.  The General said after meeting President Abdul Hamid that “China and Bangladesh should make joint efforts against powers from outside the region establishing a military alliance in South Asia and practicing hegemonism.” The visit underlined the strength of Bangladesh-China defence relations that are on track to join Bangladesh-China economic relations to enhance Bangladesh-China bilateral relations to a new level of excellence.

Meanwhile, the developments in Afghanistan have also affected Bangladesh-China relations positively in two ways. First, China with Russia has made huge strategic gains in the region with the withdrawal of US/NATO forces from Afghanistan. Second, India has lost its foothold in Afghanistan, completely for the time being with the return of the Taliban that is not friendly towards it. The Talibans entered and took Kabul on August 15 without firing a shot. The Indian Ambassador waited a day for an aircraft from New Delhi, a Globemaster, to arrive and left Kabul abandoning the Embassy on August 17 with about 150 Embassy staff !

Ascending Bangladesh-China relations

China is now confident of its position of strength in South, West and Southeast Asia. It is no longer concerned about India’s sensitivities in conducting bilateral relations with Bangladesh. It had waited long for strains in India’s relations with the AL and the rise of anti-Indian sentiments in Bangladesh. These strains have now appeared. The strain between the AL and India was evident when Sheikh Hasina dropped a good number of pro-Indian ministers from her cabinet to flag her disappointment that New Delhi had not responded to her pleas for support in the 2018 Bangladesh elections. It has further been evident from Indian High Commissioner Riva Ganguli’s failed attempts to meet Sheikh Hasina for months that eventually led to her premature recall to New Delhi as mentioned earlier in this piece.

Bangladesh-China relations in contrast to its declining relations with India are enhancing on a fast track with immense possibilities of future growth. The excellence of the relations and the possibilities of future growth are the outcome of the vision and the strategies with which China established and pursued its relations with Bangladesh. The Bangladesh-China bilateral relations are expected to receive a further boost from the strategic changes and developments in the region that have been positive for China and not so positive for India.

China’s two-tiered approach wins support

Bangladesh-China relations have achieved its present level of excellence primarily because China has pursued these relations with a clear strategy and vision. The strategy has not been anything new for China. It has been the way it conducts its bilateral relations with all other countries. It is a two-tiered system, one conducted between the two governments and the other between the Communist Party of China and the political parties of the country with which it conducts bilateral relations, the ruling as well as those in the opposition. The objective of the two-tiered system is to reach across the entire political spectrum to make bilateral relations strong and sustainable. China pursued its two-tiered policy with Bangladesh with strict non-interference in Bangladesh’ domestic politics that allowed it to remain outside controversy in Bangladesh’s highly partisan politics. China thus has been accepted by all and sundry in Bangladesh.

 

This paper was presented in the Webinar series for the commemoration of 58th Anniversary of Moulana Bhashani’s historic China visit, organised by the Moulana Bhashani Parishad, Australia.