China and India are in a geopolitical tug of war for expanding their spheres of influence to Bangladesh, according to East Asia Forum.
Trade is the major area of competition between the two giants who run a huge current account surplus with Bangladesh, an article puublished by the Australia-based policy forum observed on Wednesday.
It suggests that the Indian government sees Bangladesh as an important neighbour for political, national security and religious reasons while Chinese influnce in these areas is not so dominant.
However, the article pointed out that China and India will do their best to edge each other out in their battle for influence in the Bay of Bengal.
The two Asian powers will try to exploit what the artiicle called ‘an economically weak Bangladesh’.
The two “are likely to fail as Bangladesh continues to play hard to get and plays them off against each other”, wrote economist Forrest Cookson and journalist Felix Joehnk in the article.
It also mentioned that Bangladesh is a transport corridor to India’s northeastern states and a vital alternative route to the vulnerable Siliguri corridor that in the past has been threatened by China’s military, isolating all of northeast India.
It called the view from Delhi “very short term” and said India’s strategy is to keep the Awami League in power while trying to block growing Chinese influence.
The article further observed that China is playing a long game in Bangladesh and it balances its relations with the ruling Awami League and the Bangladesh Natonalist Party (BNP).
The article gave statistics that China exported US$16-17 billion worth of goods to Bangladesh and imported only US$750 million in 2016-17. China’s foreign assistance to Bangladesh amounts to about US$1 billion a year and a large US$24 billion lending programme, promised by China’s president Xi Jinping during his visit in October 2016, is only just getting underway.
Bangladesh’s current account deficit with India as well is at least US$12 billion, the article cited statistics.
“India exports about US$8 billion worth of goods to Bangladesh (once adjusted for under-invoicing) and imports just US$260 million. Informal trade is in India’s favour by US$2-3 billion, with remittances by Indians working in Bangladesh estimated to be around US$2-4 billion. India’s annual disbursed foreign assistance to Bangladesh amounts to US$150 million,” reads the article.
Now, the article pointed out, both India and China are offering large sums of money for infrastructure projects in Bangladesh.
“Both are promoting large railway projects (low return investments that will do little for Bangladesh) and both are keen to get involved in building a deep-sea port in Bangladesh,” said the article.
It added that China has long been the main supplier of military equipment to the Bangladesh armed forces and India is trying to catch up.
“In the realm of culture, Indian influence in Bangladesh is overwhelming. The two countries share a common language… At least 100,000 Bangladeshis attend school in India and universities in the two countries entertain close links. For its part, China has established Confucius Institutes in Bangladesh that teach Chinese language and scholarships are available for Bangladeshis to study in China,” the article said.
It observed that Bangladesh is not a passive victim of the geopolitical competition in the Bay of Bengal.
“Bangladesh is using its strategic position to encourage it. There is a clear awareness in Dhaka that both India and China take more than they give and that their infrastructure and manufacturing projects are of low quality (compared to those of Japan and South Korea),”it reads.
It said that the Rohingya refugee crisis has also made clear that China and Bangladesh are only fair-weather friends.
“China is blocking the UN Security Council action to move against the genocide or ethnic cleansing by the Myanmar government, which Bangladesh sees as an unfriendly act. India, ostensibly Bangladesh’s closest ally, is no better: in the Rohingya refugee crisis it squarely backs Myanmar,” it reads.
It added that changes in trade policy might have the biggest impact on the giants’ respective influences in Bangladesh.
The article concludes that China, which is far richer than India and whose economy dwarfs India’s, has an advantage on trade.
“If it were to open its economy to billions of dollars of imports from Bangladesh, the balance of power in Bangladesh would shift decisively in China’s favour,” it reads.