China-Bangladesh BRI Impact on India UPSC
Source: The Hindu
GS II: India and its neighbourhood- relations
Overview
- News in Brief
- China–Bangladesh Relations: Background
- Impact on India
- Belt and Road Initiative
Why in the news?
China-Bangladesh And BRI taking new lead. Chinese President ready with Bangladesh leaders to better align the two countries’ strategies and jointly promote the construction of his multi-billion dollar Belt and Road Initiative (BRI) to take the strategic partnership of the two countries to new heights.
- Both nations are in the events of 45th anniversary of the establishment of the bilateral diplomatic relationship.
- Bangladesh became a part of the Belt and Road Initiative in 2016
News in Brief
- China aims to better align development strategies with Bangladesh, step up cooperation under the framework of the BRI and push forward the China-Bangladesh strategic, cooperative partnership to a new level.
- China-Bangladesh And BRI
- With over $26 billion Chinese investments and $38 billion dollars funding commitments, Bangladesh is one of the largest recipients of China’s massive infrastructure project.
- China in earlier offered zero-tariff treatment to 97% of Bangladesh’s exports by adding 5,161 more items to the existing list of 3,095 duty-free products.
- But in the 2024 joint statement mentions 98% of taxable items, effective from 1 September 2022, with support beyond Bangladesh’s LDC graduation.
- One of the major projects under the BRI is the Bangladesh Power System Upgrade and Expansion Project, which aims to provide electricity connections to over 2.5 million rural people.
Belt and Road Initiative
- The BRI seeks to build rail, maritime and road links from Asia to Europe and Africa in a revival of ancient Silk Road trading routes.
- BRI, earlier known as One Belt One Road (OBOR).
- South-east Asia to Eastern Europe and Africa, Belt and Road includes 71 countries that account for half the world’s population and a quarter of global GDP.
- Improving regional integration, increasing trade and stimulating economic growth are the major aim.
- Belt and Road Initiative is expected to cost more than $1tn.
- The BRI focuses on infrastructure connectivity, trade, financial integration and people-to-people cooperation.
China–Bangladesh Relations: Background
- 1975: Diplomatic relations established.
- 2016: Bangladesh joined BRI during the visit of the Chinese President.
- 2024: China and Bangladesh upgraded ties to a higher strategic partnership.
- 2025 onwards: 50 years of diplomatic relations and continued cooperation.
- Bangladesh is described by China as the first South Asian country to join and participate in BRI.
Recent China-Bangladesh cooperation includes projects such as the Karnaphuli tunnel, Padma Bridge Rail Link, power grid strengthening, Dhaka-Ashulia Elevated Expressway and water treatment projects.
Why is Bangladesh Important for China?
- Geostrategic Location: Bangladesh connects South Asia, Southeast Asia and the Bay of Bengal.
- Access to the Bay of Bengal: Ports and maritime routes are important for China’s trade and regional influence.
- Infrastructure Market: Bangladesh needs large investment in transport, power, ports and urban infrastructure.
- Strategic Presence in India’s Neighbourhood: China’s presence in Bangladesh adds to its influence in South Asia.
Major Areas of China-Bangladesh BRI Cooperation
- Transport Infrastructure: Rail, road, expressways, bridges and urban transport.
- Power and Energy: Power grid strengthening, power transmission and energy projects.
- Ports and Maritime Connectivity: Port-led development, logistics and Bay of Bengal connectivity.
- Digital and ICT Cooperation: Telecommunication, digital infrastructure and smart economy cooperation.
- Trade and Market Access: China’s tariff concessions and Bangladesh’s export interests.
Benefits for Bangladesh
- Infrastructure development
- Padma Bridge Rail Link: A 172 km rail network connects Dhaka to the country’s southwestern districts, crossing the Padma Multipurpose Bridge helps regional trade and passenger transport.
- Karnaphuli (Bangabandhu) River Tunnel: The first-ever underwater tunnel in South Asia, located in Chattogram, enhances connectivity to the Port of Payra and eases urban congestion.
- Employment and industrial growth
- Chinese Economic & Industrial Zone (CEIZ): Located in Chattogram, this zone aims to attract Chinese manufacturing and foreign direct investment.
- This will boost the Employment in the country.
- Better transport and logistics
- Chattogram-Cox’s Bazar Rail Line: Constructed a railway improving access to the country’s prominent tourist and commercial hubs.
- Power supply improvement
- Banshkhali Coal-Fired Power Plant: Developed to add a 1,320 MW capacity to the nation’s energy.
- coal-fired power station Payra Thermal Power Plant jointly owned by Bangladesh and China.
- Export market access
- BRI promotes the development of high-potential sectors like leather, pharmaceuticals, and shipbuilding.
- Exporting leather and leather goods along BRI corridors can yield over $5 billion annually
- Support for Bangladesh’s development goals
Concerns and Challenges for Bangladesh
- Debt sustainability
- Overall, the public debt burden is slowly rising due to domestic debt accumulation
- Unviable infrastructure megaprojects increase the burden.
- Project delays and cost overruns
- Recent government changes and the global war in Iran causes delay in projects.
- Due to the war, the global supply chain has caused abnormal spikes in the price of basic construction materials
- Transparency in contracts
- Key financial flows, loan conditions, and contract clauses are rarely disclosed
- Direct procurement or bilateral nominations limits the government’s ability to ensure cost-efficiency and opens.
- Environmental and social impact
- Mostly, have Coal fired thermal projects are environmental concerns.
- Large-scale linear infrastructure, such as the Padma Rail Link poses risks to soil erosion, wetlands, and key local biodiversity areas.
- Overdependence on one major power
- Borrowing for megaprojects like the Padma Bridge Rail Link and Payra Thermal Power Plant contributes significantly to foreign debt.
- Over 20% of Bangladeshi imports come from China (mostly machinery and textiles), while exports to China represent a tiny fraction.
- Need to balance India, China, Japan and Western partners
- China and Japan frequently compete for influence in Bangladesh, with Tokyo’s Free and Open Indo-Pacific (FOIP).
- Recently, after regime change, Bangladesh signalled China by showing interest in the U.S. Indo-Pacific strategy.
- Overdependence on China risks isolating India
China-Bangladesh BRI Impact on India
- India has concerns with BRI as one portion of the corridor passes through Pakistan-occupied Kashmir.
- India is concerned about China’s growing footprint in our neighbourhood.
- China initiated over $60 billion as part of the China-Pakistan Economic Corridor (CPEC),
- China has stepped up its huge infrastructure investments in Bangladesh, Nepal, Sri Lanka and the Maldives, raising concerns of its growing influence in India’s immediate neighbourhood.
- India and US raise concerns over the debt-diplomacy of China.
- As part of this policy Sri Lanka in 2017 handed over its Hambantota Port to a state-run Chinese firm.
- For a 99 years’ lease in a debt swap amounting to $1.2 billion.
- Malaysia has also deferred several projects under the BRI, citing cost reevaluation.
- Djibouti, Kyrgyzstan, Laos, the Maldives, Mongolia, Montenegro, Pakistan and Tajikistan are among the poorest in their respective regions and will owe more than half of all their foreign debt to China.
- As part of this policy Sri Lanka in 2017 handed over its Hambantota Port to a state-run Chinese firm.
- India was the only country in the eight-nation Shanghai Cooperation Organisation grouping that opposed the initiative.
- Strategic Concerns: China’s growing role in Bangladesh, Nepal, Sri Lanka, Maldives and Pakistan increases India’s strategic concerns.
- CPEC and Sovereignty Issue: India opposes BRI mainly because the China-Pakistan Economic Corridor passes through territory claimed by India.
- Bay of Bengal and Indian Ocean Security: Chinese-linked port and maritime projects increase India’s need to strengthen maritime security.
- Impact on India-Bangladesh Relations: India must ensure that delays in bilateral projects, water-sharing issues and connectivity gaps do not create space for external influence.
- North-East India:
- Bangladesh is important for India’s connectivity with the North-East.
- Better India-Bangladesh infrastructure cooperation can reduce strategic imbalance.
How does India respond to the initiative?
- Neighbourhood First policy
- Act East policy
- BIMSTEC cooperation
- India-Bangladesh connectivity projects
- Development partnership with Bangladesh
- Japan-India cooperation in the Bay of Bengal and the North-East connectivity
- SAGAR vision and Indo-Pacific partnership
Previous Year Questions – Mains
- The China-Pakistan Economic Corridor (CPEC) is viewed as a cardinal subset of China’s larger ‘One Belt One Road’ initiative. Give a brief description of CPEC and enumerate the reasons why India has distanced itself from the same. (2018)
Previous Year Questions – Prelims
- Belt and Road Initiative is sometimes mentioned in the news in the context of the affairs of (2016)
(a) African Union
(b) Brazil
(c) European Union
(d) China
Ans: (d)
Way Forward
- Among the issues that have seen such a delay is the water-sharing deal on the Teesta river that has to be negotiated.
- Proposal from China on the management and restoration of the Teesta river under process.
- Discussions around the Teesta River initiative and continued cooperation despite political changes in Bangladesh.
- India needs to work both on maintaining good ties with Bangladesh and also countering the influence of the initiative through strategic alliances.
- India should fast-track pending connectivity and energy projects with Bangladesh.
- Teesta water-sharing and river management issues need diplomatic attention.
- India should offer transparent, affordable and timely infrastructure support.
- Bangladesh should maintain debt sustainability and project transparency.
- Regional cooperation through BIMSTEC and BBIN should be strengthened.
- India should combine economic diplomacy, maritime security and people-centric development.
Conclude that China-Bangladesh BRI cooperation is not merely an infrastructure issue but a geopolitical development affecting South Asia, the Bay of Bengal and India’s neighbourhood strategy. India must respond through faster project delivery, diplomatic trust-building and regional connectivity.
UPSC Prelims Quick Facts
- BRI full form: Belt and Road Initiative
- Earlier name: OBOR
- Main components: Silk Road Economic Belt and Maritime Silk Road
- Bangladesh joined BRI in 2016
- CPEC is part of BRI
- India has not joined BRI
- Bay of Bengal relevance
- Important related groupings: BIMSTEC, BBIN, SCO
UPSC Mains Practice Question
“China’s Belt and Road Initiative in Bangladesh has both developmental and strategic implications for India. Discuss.”
Key Takeaways
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