China's support for Bangladesh: In whose interest?

The Interim Government’s Chief Adviser, Dr. Muhammad Yunus, is set to visit China on March 26 for a four-day official trip with a delegation. This will be his first bilateral state visit since assuming office, drawing significant interest among analysts, particularly given the recent political changes in Bangladesh. The visit holds special significance in the context of the August 5 student and public movement that ended 15 and a half years of autocratic rule. Observers are paying close attention to this visit, as it could mark a turning point in regional geopolitics.

When the government was overthrown on August 5 following the July movement, former Prime Minister Sheikh Hasina fled to India, where she was granted asylum and security. Despite Bangladesh’s formal request for her return, India has not responded favorably, creating tensions in Bangladesh-India bilateral relations. There are concerns that these relations may deteriorate further in the future. Against this backdrop, China has extended a hand of cooperation to Bangladesh, expressing a desire to strengthen bilateral ties. China’s offer to send a special aircraft to bring Dr. Yunus underscores the importance Beijing places on his visit. This trip has the potential to introduce a new dimension to regional geopolitics.

Although China did not support Bangladesh’s Liberation War in 1971, it later established itself as a reliable ally. China has supported Bangladesh’s stance in various international forums and is known for its socialist ideology. Despite its socialist foundation, China has successfully integrated itself into the global economy and capitalized on its demographic dividend for economic growth. A few years ago, an international research organization projected that if China's economic progress continues at its current pace, it will surpass the United States as the world’s leading economic power before 2050.

Over the past few decades, China has made remarkable economic and technological advancements. While Japan maintained its position as the world's second-largest economy for 44 years, China surpassed Japan to claim that spot a few years ago. China’s rapid advancements in modern technology and its ability to transform a vast population into an economic asset serve as valuable lessons for other nations, including Bangladesh. While Bangladesh has experienced a demographic dividend since 2000, it has failed to capitalize on its benefits. There is a lack of awareness among policymakers regarding how to leverage this advantage, resulting in population growth remaining a challenge rather than an asset. Bangladesh can learn from China’s experience in turning its population into a productive force.

China has proven to be a reliable friend of Bangladesh, contributing not only in international forums but also in economic development. Historically, India was Bangladesh’s top trading partner, but China has since taken the lead. In the 2023-24 fiscal year, Bangladesh-China bilateral trade amounted to 2.25 trillion BDT, compared to 1.46 trillion BDT in Bangladesh-India trade. The share of Chinese imports in Bangladesh’s total trade increased by 15.17%, while trade with India declined by 8.47%. In the 2022-23 fiscal year, Bangladesh exported goods worth $677 million to China while importing $22.90 billion worth of goods from China.

Chinese investments in Bangladesh are steadily increasing, with China involved in the construction of 21 bridges and 27 power plants. Over the past two years, China has provided Bangladesh with approximately $1 billion in loans annually. Among Bangladesh’s top 10 lenders, China ranks prominently, having granted the country a total of $36 billion in loans. During Dr. Yunus’s visit, Bangladesh is expected to request an additional $5 billion in soft loans. Given the shifting landscape of global investment, Bangladesh has the potential to become a major destination for Chinese investment. Over the past decade, China has invested $2.6 billion in Bangladesh. With rising labor costs and trade barriers affecting Chinese businesses, many investors are looking to relocate their industries.

The U.S.-China trade war, which escalated after Donald Trump took office as U.S. President, has led to increased tariffs on Chinese imports. As a result, some Chinese companies are seeking alternative locations for investment, with Vietnam being a top choice. However, Bangladesh has an opportunity to attract some of these businesses. Dr. Yunus's visit is expected to focus on investment opportunities, easing loan repayment conditions, and extending repayment deadlines. During his trip, Dr. Yunus will also hold bilateral talks with Chinese President Deng Xiaoping. Several agreements and memoranda of understanding (MoUs) are expected to be signed, potentially elevating Bangladesh-China relations to new heights.

Dr. Yunus’s visit is not only economically significant but also politically and strategically important. The potential realignment of regional politics is another key aspect of this visit. Given the recent strains in Bangladesh-India relations, China may seek to strengthen its influence over Bangladesh. If new regional alliances emerge, it will not be surprising. However, Bangladesh must make calculated decisions, as leaning too heavily toward China could impact its strong ties with the United States, which actively seeks to counter Chinese influence.

During my tenure as Bangladesh’s ambassador to Bahrain, I witnessed firsthand how bilateral visits play a crucial role in strengthening and repairing diplomatic relationships. Therefore, I am confident that Dr. Yunus’s visit will further solidify the already strong Bangladesh-China ties.

Another key area of potential collaboration between Bangladesh and China is education and technical assistance. While China follows a socialist education model, which may not be directly applicable to Bangladesh’s democratic system, its advancements in technical education and robotics could be highly beneficial. Bangladesh imports machinery and raw materials for its garment industry from China, and learning from China’s success in entrepreneurship and production technology could be valuable. A teacher and trainer exchange program between the two nations could facilitate knowledge transfer.

Bangladeshi students could also benefit from studying in Chinese institutions specializing in advanced technology. To facilitate this, expanding Chinese language education in Bangladesh is crucial. While Dhaka University offers limited Chinese language courses, more extensive language programs should be introduced to strengthen academic ties. The historical links between Bangladesh and China in education date back centuries. Chinese travelers like Xuanzang and Faxian documented Bangladesh-China relations, while the renowned Bangladeshi scholar Atisha Dipankara taught at a Chinese university. Today, a significant number of Bangladeshi students study in China, and some Chinese students are also enrolled in Bangladeshi institutions.

As Bangladesh and China are friendly nations, it is natural for their bilateral relations to grow stronger in the future. China has proven to be a dependable friend, standing by its allies in times of need. As Bangladesh continues its economic and security development, China’s support may become even more crucial. We expect Dr. Yunus’s visit to further enhance and accelerate Bangladesh-China bilateral relations.

Dr. Anwarullah Chowdhury: Former Vice-Chancellor, Dhaka University & Former Ambassador, Government of the People’s Republic of Bangladesh
Transcribed by: M. A. Khalek