Since the arms deal between India and the United States miffed Beijing has termed the engagement between the two nations as “dangerous for the region”.
To exacerbate the Chinese worries, the deference exhibited by the American President Mr Donald Trump with regards to Indian Prime Minister Narendra Modi on the Bangladesh issue has certainly got the Chinese in sorts of fluster.
Regardless of speculations, Trump, in his meeting with the Modi, had confuted claims of any role the US deep state played in the Bangladesh unrest. He stated: “There was no role for our deep state. This is something that the Prime Minister [Modi] has been working on for a long time, for hundreds of years, frankly I have been reading about it. I will leave Bangladesh to the Prime Minister.”
China’s anxiety also originates from the high stakes it has in Bangladesh, which is inclusive of its larger South Asian strategy. This is evident from its expansionism strategy though Belt and Road Initiative (BRI or B&R), infrastructure, and energy project investments in the country.
“Chinese funding typically involves loans from China Exim Bank to Bangladesh companies and later, these firm contact Chinese firms for construction. Chinese state-owned firms (such as China Road and Bridge Corporation) dominate construction, limiting local industry participation,” sources have reported.
According to various reports China has pledged $40 billion to Bangladesh.
$26 billion is reported to have been already invested in infrastructure and energy projects.
Even though Bangladesh has been admonished in regards to the loans by the International Monetary Fund (IMF), it has insisted that the loans could be easily be managed.
While Chinese loans are bound to Chinese contractors, it can be expected to increase Bangladesh’s costs and debt risks.
China seeks access to important sea routes due to which Bangladesh’s strategic location makes it important for China’s BRI.
Project investments in the Payra Port give China access to the Bay of Bengal. This reduces its reliability on the Malacca Strait for trade routes. These efforts are being pushed to reduce India’s influence in South Asia.
Like several nations that the Chinese have allied with in regards to investments, it plans to put Bangladesh in a debt trap through investments and defence cooperation.
According to reports, Bangladesh imports $15 billion worth of Chinese goods annually and exports only $1 billion worth of goods.
Chinese Investment Projects in Bangladesh
- Payra Coal Power Plant $2.4 billion (1,320 MW)
- Banshkhali Coal Power Plant $2.5 billion (joint venture)
- Sylhet Thermal Power Plant Expansion approximately $1.6 billion
- Padma Bridge Rail Link $3.3 billion (financed by China Exim Bank)
- Karnaphuli River Tunnel $1.1 billion (China’s first underwater tunnel project in South Asia)
- Dhaka-Chittagong Railway Upgrade $3 billion (part of BRI)
- Dhaka-Ashulia Elevated Expressway $1.2 billion.
- Payra Port Development ($1.5 billion).
Since 2023, Bangladesh’s debt to China has increased to $6 billion.
Since the ouster of the former Prime Minister of Bangladesh, the country is embroiled in myriad of issues from economic instability and human rights violations.
