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International Relations

Is Sri Lanka, China’s New Colony?

China & Sri Lanka: an enduring alliance?

China’s rise as a global economic power – and potentially a global political power too – is attracting more and more attention. From the so-called “Belt and Road Initiative” (BRI) to China’s increasingly aggressive tactics in the South China Sea, the activities of the People’s Republic are one of the biggest stories in international relations.

Whilst in the West, and particularly in Britain and America, the debate is often centred on whether the inexorable side of China represents a threat or an opportunity, the countries living in close proximity to China are scrambling to come to terms with the reality of Chinese power.

Some countries, notably Vietnam, Indonesia and the Philippines, find themselves in territorial disputes with China as a result of the People’s Republic aggressive boundary setting moves in the south China Sea.

In addition, there is the more long-standing political dispute between China and Taiwan centred on the former’s claims of sovereignty over the latter. What all these myriad territorial and political disputes have in common however is the involvement of the United States.

In nearly all cases the US intervenes on behalf of states who feel aggrieved by China’s actions in the South China Sea and beyond. Whilst Washington justifies its own aggressive actions – including challenging Chinese sovereignty over the Spratly islands – as part of its drive to ensure “freedom of navigation” in disputed maritime areas, the reality is that the US is above all concerned with the prospect of China displacing America as the dominant regional power.

But there is another side to the rise of China, both in its immediate environment, regionally and more broadly in a global setting. This is a story of successful Chinese outreach to multiple states, characterised by massive investments in infrastructure and resulting political influence.

One of these states is Sri Lanka, a country strategically perched next to India in the Indian Ocean. Sri Lanka has come a long way since gaining independence from Britain in February 1948. In the 70 years since independence Sri Lanka has established relatively stable political institutions, in addition to successfully prosecuting a quarter century long counter-insurgency campaign against Tamil separatists in the north and east.

Sri Lanka is important to China for many reasons, much of it revolving around the island nation’s strategic position in the Indian Ocean and its proximity to China’s great rival India. In addition, Sri Lanka presents China with a wide range of investment opportunities which in the long-term can help entrench Chinese influence in the country.

China’s strategic motive

In keeping with its emerging great power status China’s approach to foreign policy is shaped primarily by strategic considerations. To that end, the Chinese leadership has identified three core strategic rivals and potential enemies, namely India, Japan and the United States. Historic Chinese relations with all three powers has been marked by high tension and conflict, particularly with India and Japan.

Therefore, the thrust of Chinese foreign policy is to blunt the influence and reach of these three powers in China’s immediate neighbourhood, or areas where China has traditionally identified as its backyard.

For example, China’s support for North Korea is designed to deter the United States from acknowledging Taiwanese independence. More broadly, China’s support for North Korea is also designed to send a strong message to Japan, whose re-militarisation unsettles China’s historical consciousness.

To its immediate West China is confronted by the Indian giant, a country whose population is only marginally smaller than China’s. India not only challenges China economically, but also politically, on account of the fact that India is considered a “democracy” (albeit with an Asian twist) whereas China is still deeply authoritarian and officially at least still wedded to a communist ideology.

Furthermore, at a strategic level, India is a major rival to China, as similar to the People’s Republic India is incrementally augmenting its military capability with a view to projecting power well beyond its immediate sphere of influence. The development of a so-called blue-water navy (basically a maritime force with global reach and capability) is demonstrative of India’s ultimate ambitions.

In view of India’s strategic ambitions, China has devised a variety of economic, political, diplomatic and military tools to contain its big neighbour to the West. In terms of direct political intervention, and in order to offset Indian meddling in Chinese affairs (as demonstrated by India’s hosting of the Dalai Lama), China is suspected of supporting left-wing militant forces in south-eastern India. These forces have come to be known as the Naxalite-Maoist insurgency and are based mostly in Andhra Pradesh state.

In the diplomatic and economic spheres, China is engaged in extensive outreach to India’s neighbouring states, in particular Pakistan, which is viewed as a counter to India in the subcontinent. China has massive investments in Pakistan, notably in the deep-sea port of Gwadar. More broadly, China is stepping up its longstanding military cooperation with Pakistan, particularly in the ballistic and cruise missiles sphere.

China’s outreach to Sri Lanka is ultimately explainable in the context of China’s strategic posture and associated calculus. Although Sri Lanka is not a large and powerful state like Pakistan – and its relations with India is nowhere near as fraught as Indo-Pakistani relations – nevertheless by establishing influence on the island nation China gains more leverage in its emerging great power rivalry with India.

What does Sri Lanka offer to India?

As stated earlier, Sri Lanka’s close proximity to India inevitably makes it attractive to Chinese strategists. And of course, with geographic proximity comes a high degree of cultural proximity. Indeed, there are strong cultural bonds between the two nations, centred on the Tamil community in northern and eastern Sri Lanka, who are the ethnic kin of the large Tamil community in India’s deep south.

The fact that the Tamils of Sri Lanka were embroiled in a decades long conflict with the central government renders this dimension even more important to the Chinese. More on this later. But suffice to say it is in China’s strategic interest for Sri Lanka to have a strong and stable central government.

A unified and strong Sri Lanka is much more likely to oppose core Indian strategic positions, notably the expansion of Indian influence in the Indian Ocean, and to that end a strong and stable Sri Lanka satisfies China’s strategic priorities.

China cynically exploits tensions in Indo-Sri Lankan relations, notably the majority Sinhalese’s guarded attitude toward India, and Sri Lanka’s natural inclination towards India’s rivals. Note that Sri Lanka has strong ties to Pakistan, India’s nemesis on the subcontinent. Moreover, China seeks to contain Western influence on Sri Lanka, and where possible to drive a wedge between Colombo and Western capitals.

For example, China shields Sri Lanka from Western criticism on human rights issues, focussed on Colombo’s reported mistreatment of the Tamil minority in the north and east of the island. By containing and deterring Western influence in Sri Lanka, China is effectively constructing an outer defensive ring around its core territorial, political and economic interests much further away in the South China Sea area.

From this perspective, China’s outreach to Sri Lanka is an important example of China’s emerging global ambitions and a thinly-veiled desire to project power and influence well beyond its immediate neighbourhood.

The economic dimension   

Interestingly, the issue of human rights is bound up with China’s entry into Sri Lanka’s economy. This entry began in earnest in the immediate aftermath of the successful conclusion of the counter-insurgency campaign against Tamil Tiger rebels in May 2009. At the time Colombo was chafing under Western criticism of its alleged human rights abuses, notably the reported killing of thousands of Tamil civilians in the northern Jaffna Peninsula in the closing stages of the war.

China, similar to Russia, has a policy of non-intervention in the domestic politics of the countries it tries to cultivate. To that end, the Chinese not only did not care about the possible massacre of Tamil civilians, but in fact they undertook active measures – by way of diplomacy and media propaganda – to protect Sri Lanka from Western criticism.

Since 2010 China has invested significant sums in infrastructure projects in southern Sri Lanka and more recently Beijing has begun to invest in northern Sri Lanka as well, including the Jaffna Peninsula, which was the site of the most ferocious battles of the Sri Lanka Civil War of 1983-2009. For example, a major Chinese engineering company is set to build 40,000 houses in the Jaffna Peninsula.

Whilst successive Sri Lankan governments have welcomed Chinese investment, Beijing’s increasing economic influence on the island nation is not completely free of controversy. The case of the Hambantota Port Development Project is being increasingly cited to highlight the exploitative dimension of China’s investment strategy in Sri Lanka.

Construction of the port began in January 2008 and it is set to become Sri Lanka’s largest port, displacing the Port of Colombo from the top spot. But the project incurred heavy losses and was only kept going by Chinese loans, to the point where Sri Lanka was effectively forced in December 2017 to lease the port for 99 years to the Chinese.

China’s critics and detractors often use this case to demonstrate Beijing’s alleged cynical use of loans and investment funds to advance political and strategic ambitions. They also argue that massive infrastructure projects driven and funded by Chinese loans and associated finance potentially undermine the sovereignty of small states like Sri Lanka and to that end they can be construed as a form of Chinese imperialism.

How stable is Sri Lanka?

At present Sri Lanka is embroiled in a political crisis after President Maithripala Sirisena fired Prime Minister Ranil Wickremesinghe only to replace him with hardliner Mahinda Rajapaksa. This arbitrary dismissal of a sitting government has been fiercely resisted by the Sri Lankan parliament, to the point where there is political stalemate.

Sri Lanka is currently in the strange position of having two prime ministerial claimants – and potentially two rival governments – and hence on the threshold of deep political turmoil and potential bloodshed. However, despite the deep political uncertainty, the country is relatively calm and smooth administration continues apace.

This speaks to Sri Lanka’s bureaucratic resilience as embodied by the country’s civil service. In the past ten years China has tried hard to cultivate deep links to Sri Lanka’s bureaucracy with a view to investing in the country’s long-term stability. By cultivating allies in the Sri Lankan civil service Beijing believes it can mitigate the instability emanating from Colombo’s volatile politics.

In the final analysis, all the available evidence suggests that China – in keeping with its far-sighted global strategy – is set to deepen its influence in Sri Lanka in the years and decades to come.

Will Vietnam clash with China over the South China Sea?

Bilateral relations between China and Vietnam are not as easy as it may seem. At a first glance, they may be expected to maintain a positive and flawless partnership due to the similar political system. However, a deeper analysis reveals various divergences between the two countries, whose relations are becoming more conflictual with each passing year.

Historical background

China and Vietnam are both the cradle of ancient civilizations, but we can start examining their history since the two states took their current form in the aftermath of WWII.

After more than a century of intromissions and abuses from the part of Western powers and Japan, in 1945 China was devastated by war and politically divided. After a long and destructive civil war between the Communists and the Nationalists, which dated back to the 30s and was temporarily suspended to form a unified front against the Japanese invasion, the People’s Republic of China was proclaimed in 1949 following the victory of the Communists under the leadership of Chairman Mao Zedong. On their part, the Nationalists took refuge in Taiwan, where they founded a state that still remains de facto separated from the mainland. Still, the PRC was weak and isolated. It had very few allies apart from the Soviet Union; whose assistance was not sufficient to spark a sensible economic growth. Virtually all the other powers, especially the United States, were hostile to China. Moreover, Beijing’s relations with Moscow soon started deteriorating, to the point that the two seemed to be on the brink of war in 1969, when a series of border clashes took place.

Vietnam also had a troubled history following the end of WWII. France, the ancient colonial power, restored its control over the country after the brief Japanese occupation during the conflict. Yet, the Vietnamese soon started an insurgency that ultimately ousted the French in 1954. Following the negotiations that ended the war, Vietnam was divided in two states separated by the 17th parallel: the communist Democratic Republic of Vietnam in the north and the pro-American Republic of Vietnam in the south. But peace did not last long. One year later, a communist armed movement known as Vietcong was already active in the South, where it tried to overthrow the pro-Washington government. As the situation deteriorated, the US gradually escalated its support to the South, to the point of sending combat troops in the mid-60s. But the massive deployment of forces was not enough to defeat the Vietcong supported by the North and its allies, namely China and the USSR.

By the late 60s, then, both China and Vietnam were communist countries hostile to the US. Yet, things would soon change. After secret talks, the Nixon administration announced an unexpected diplomatic opening to the PRC, which culminated in the President’s visit to the country in 1972. This move was mainly driven by a double fold strategic logic. First, the US wanted to exploit the Sino-Soviet Split to its own advantage by putting the two communist states against each other and thus increase pressure on the USSR. Second, the Americans hoped to convince China to reduce its support to North Vietnam and thus facilitate the negotiations to end of the Vietnam War; and effectively a diplomatic settlement in this sense was reached in 1973. In spite of this, two years later the North launched a full-scale invasion of the South with its regular military forces. Strained by the long and costly war, the US decided to abandon Vietnam; which was therefore reunited under the communist regime.

Since then, the relations between Vietnam and China rapidly deteriorated. On spite of the similar political system, their alignment to the USSR and other regimes in South-East Asia led them to a short war in 1979 where both sides claimed victory; but their relations gradually normalized after the conflict. Later, China started implementing economic reforms, which sparked an extraordinary economic boom that still continues today; albeit at a slower pace. Vietnam followed its example, and today it is a fast-growing economy in full modernization. In both cases, this was not accompanied by political opening, and the respective Communist parties continue being the centre of the political system in each country. But during the past decade, bilateral relations have been worsening once again over a series of issues; and the trend seem to consolidate.

Sino-Vietnamese Disputes

The first and most important dispute existing between Vietnam and China is the one over the Paracel and Spratly islands, both located in the South China Sea, or SCS. This is very complex issue that goes way beyond the Sino-Vietnamese relations; as it involves overlapping claims by multiple countries over a strategic area for maritime trade that is also a rich fishing ground and is believed to host hydrocarbon reserves. Here it is sufficient to say that both China and Vietnam advance claims on the two archipelagos; but it is important to note that the Paracel are all occupied by the PRC. In fact, Beijing considers practically the whole of the SCS as its possession according to the “Nine-Dash Line” theory; and has been increasing its military presence in the area by conducting patrols, by expanding existing islands or even by building artificial ones, and by positioning military hardware and bases on their soil. Its activities have raised much concern in Vietnam and other riparian states; but due to their division and to the marked power imbalance in its favour, China has managed to gradually but firmly stabilizing its position in the SCS.

While this may look like a trivial quarrel over very small islets and rocks, in reality it has a major geostrategic significance. Legitimately controlling a piece of land that is recognized as an island (and not a simple rock) allows states to rightfully claim the territorial waters and the Exclusive Economic Zone around it. Applied to the SCS archipelagos, this means exerting control over vast maritime spaces that are rich in fish and that may host energy resources. Moreover, the SCS is an essential crossing area for sea trade; therefore, any conflict in the area would seriously disrupt the naval traffic with huge consequences for the global economy. Finally, over time the dispute has taken a symbolic relevance, which exacerbates national animosity and further complicates a peaceful resolution of the issue. Notably, a tense standoff between the two countries took place in 2014 following China’s drilling activities in disputed waters, and in March 2018 Vietnam decided to back down and cancel an important oil project in the area. In this sense, it is also important that Vietnam is modernizing its armed forces; with a particular focus on submarines, fighters and fire-and-forget anti-ship missiles. These are all weapon systems that would be useful in the case of a clash with China in the SCS, and it appears indeed that Vietnam is reshaping its military doctrine in this specific optic.

But there are also other divergences between the two countries. Linked to the SCS dispute, an important issue to consider is China’s economic presence in Vietnam. Many Vietnamese fear that the new economic zones established by their government will end up being dominated by Chinese investors. This has created social tensions that have erupted in violent protests in June this year, with demonstrators openly accusing China and its assertive policy in the SCS. Another problem is the question of waterways; notably the Mekong and the Red River, which both originate in Chinese territory. This has significant implications. First, it means that the PRC can control their flow; with major consequences for Vietnam’s agriculture, which still represents an important part of its economy. Second, and linked with the previous aspect, it means that Vietnam is vulnerable to water pollution generated by Chinese factories located upstream.

Another issue is China’s role in the Association of Southeast Asian Nations, or ASEAN; a regional multilateral organization meant to promote dialogue and cooperation of which Vietnam is part. In regards to ASEAN, China has always been careful not to discuss the SCS dispute during the organization’s meetings, where it could be put in minority by the other states. In contrast, by applying an effective “divide & rule” strategy, the PRC has been capable of dealing with the issue directly with each member; where it can negotiate from a position of force. Moreover, China is expanding its influence over all of ASEAN members; but Vietnam is resisting. This does not exclude some positive trends in Sino-Vietnamese relations. Bilateral trade is important: in 2016, the PRC accounted for 13% of Vietnam’s export for a total worth 26.8 billion dollars; and 31% of the goods that Vietnam purchased came from China, meaning 60 billion dollars in value. Also, in spite of the disputes of the previous year, in 2015 the two countries pledged to keep positive relations. Still, it is clear that Vietnam is concerned over China’s growing leverage over other Southeast Asian countries and over its activities in the SCS; and is therefore reacting.

As a matter of fact, Vietnam is building its ties with other countries in a clear attempt to hedge against China. Hanoi tries not to provoke Beijing and officially continues to apply its “Three No Policy”; meaning no alliance, no foreign military bases on its territory and no relations with a country against a third one. Yet, it is now allowing foreign navies to access the strategic naval base at Cam Ranh Bay for supply and repair; even though it still refuses to lend it to another country. But this example shows that in practice Vietnam is fostering closer political, economic and even military cooperation with other powers like India, Japan, Australia and most importantly the US. Washington is also involved in the SCS dispute, not as a claimant state but as an international security provider, and especially as the guarantor of freedom of navigation. Considering the importance of the SCS for maritime trade, which is essential for the global economy, the US is naturally concerned by China’s actions in the region and is therefore willing to deepen its ties with riparian states to counter its influence. Vietnam is particularly important, due to its geographic location and because it is among the most powerful countries in the area. During an official trip in 2016, former President Barack Obama lifted the embargo on arms sales to Vietnam; and in March 2018 the aircraft carrier USS Carl Vinson visited Vietnam. Considering the troubled past between the two countries, these are quite notable developments.

In spite of some positive signs, the trends described above seem to indicate that economic exchanges and diplomatic promises are not enough to prevent tension. Both powers are indeed acting to secure their own national interest, with China reinforcing its positions in the SCS and Vietnam modernizing its military and fostering ties with the US and other countries. In a broader context of US-China competition, it seems that Vietnam will play an increasingly important role; but at the same time, this will put it in a collision course with the PRC, with potentially detrimental consequences for international security and for the regional stability of an area marked by territorial disputes. Only time will tell what will happen, but it seems that Sino-Vietnamese relations will follow a downgrading course in the coming years.

Is China the new tiger of Bangladesh?

Bangladesh and China have maintained good relations for much of history. Today the two countries share a strong strategic relationship, with China playing a vital role mainly in terms of economic and infrastructure development of Bangladesh. However things weren’t so good especially during the time when Bangladesh gained independence from Pakistan and the subsequent years until around the mid 1970s.

During Bangladesh’s War of Liberation in 1971, there was a outbreak of complex geopolitical rivalries. India had allied with Bangladesh due to their long-term conflicts with Pakistan, and more so because Bangladesh was actually a part of Pakistan after the end of the British empire since 1947. China had been allied with Pakistan for most of history, and the ties strengthened especially around the time of the Sino-Indian war in 1962. As a result China opposed Bangladesh’s independence and vetoed their UN membership until 1974.[1]

It was only after the military coup in Bangladesh in 1975 that relations between Bangladesh and China started to improve. Prime Minister of Bangladesh since their independence, Sheikh Mujibur Rahman had close ties with India, and only months after the military takeover, China eventually recognised Bangladesh as an independent state as diplomatic relations were secured.[2] This dramatic transformation was fascinating, but it did not come as a surprise as the military rule led by President Ziaur Rahman distanced Bangladesh from India and the Soviets[3], which can possibly be regarded as one of the most significant reasons for their improved relationships. Ziaur Rahman helped restore free market economy in Bangladesh[4] and made a visit to China in 1977 which is regarded as a crucial step in laying groundwork for bilateral cooperation, which was followed by Chinese visits to Bangladesh in the late 1970s. Since then state visits between the two countries have been regular most of which have resulted in positive discussions and signings of agreements on political, economic and security issues.

Current relations

Bangladesh and China share a very strong relationship that ranges from the spheres of the economy, politics, development to defence and security. Today, Bangladesh considers China an “all-weather friend and a trusted ally”[5]. The cooperation dates back to Bangladesh’s  military rule in the mid-70s, however the democratically elected governments since 1991 have been able to keep up the good relations. In a 2010 visit to Bangladesh by then Chinese Vice President Xi Jinping, he stated that Sino-Bangladesh relations would remain strong regardless of any change in the domestic or international situation.[6] Bangladesh Prime Minister Sheikh Hasina on the other hand reiterated the importance of the country’s bilateral relations with China considering them a major ally of the highest significance.[7]

Economic ties

One of the most important aspects of the Sino-Bangla bilateral relations is the economic cooperation. China are by far the largest trading partner of Bangladesh with the latest World Bank figures revealing that Chinese exports to Bangladesh to be worth over US$ 10 billion (in 2015)[8]. On the other hand Bangladesh is China’s third largest trade partner. Majority of Bangladesh’s imports from china consist of raw materials for clothing and textile.[9] However the balance of trade between the countries is significant with Bangladesh having a deficit of approximately US$ 9 billion.[10] Reduction in trade deficit has been a primary concern for Bangladesh over the years, and following negotiations China agreed to provide duty-free access to around 5000 Bangladeshi products to the Chinese market under the Asia Pacific Trade Agreement (APTA) which has so far resulted in a slight decline in the ratio of trade deficit[11].

Possible Free Trade Agreement?

Talks have been in progress for several years about Bangladesh seeking a zero-tariff access of 99 percent items including Ready-made garments products in order to improve balance of trade. China’s meteoric rise in becoming the 2nd largest economy in the world only behind the United States by toppling Japan was possible largely due to its diversified economy, while having 14 FTA’s with developed as well as developing countries around the globe.

However there are some challenges of the FTA, mainly with regard to China’s ‘Made in China 2015’ industrial policy plan. There are significant restrictions on investing in China, and also preference is given to state-owned enterprises that control 38 percent of industrial assets in China, skewing competition in the market in favour of those.[12] Also another concern for foreign investors is the ‘Chinese ways’ of implementation and enforcement of laws and regulations which tend to be ambiguous and lax.

A major geopolitical challenge concerning the FTA would come from the United States and India, especially with India also having a strong alliance with Bangladesh. Chances are that India may take the Chinese assertion in its backyard as a means of increasing influence in India’s sphere, while the United States may consider an FTA as a geostrategic obstacle in containing China at the Bay of Bengal and the Indian Ocean region. However, if Bangladesh wants to achieve a fairly unrestricted access to Chinese markets it needs to keep pushing further on the negotiation table, while asserting to their other major allies, India and the United States that the actions are for their own best interests mainly in terms of economic development.

Will the US-China trade war have an impact on Bangladesh?

The recent trade war instigated by Donald Trump with his protectionist approach, with Chinese retaliations following by, has had impacts in the Bangladeshi economy. There has been a rise in steel prices (mainly rods) in the domestic market threatening both the major public infrastructure projects and the real estate market due to the US imposing tariff on US$ 34 billion worth of exports from China, while the latter imposed tariff on American cotton, and while China plan on importing cotton from India, the prices had already increased by 10-12 percent. It must be noted that more than half of Bangladesh’s cotton imports are from India  [13]. Soaring cotton prices would significantly hurt Bangladesh’s economy as they would affect the readymade garment sector.

Despite having strong economic ties there have been disagreements; a significant one is Bangladesh’s refusal of agreeing to China’s terms and conditions for the construction of the Sonadia deep-sea port in 2014.

Defence and Security Cooperation

Defence cooperation has been one of the major strengths in the bilateral relations between the two countries. China happens to be the only country that Bangladesh has signed a defence agreement with, which was done in 2002. Since then China had been the largest supplier of weapons and military equipment to Bangladesh, with latter being the 2nd largest recipient of Chinese arms in the world between 2011 and 2015[14]. Between 2013 and 2017 China has provided Bangladesh with 71 percent of all their arms purchases[15]. Bangladesh also recently purchased their first submarines to add to their naval fleet causing concerns in India. The Bangladeshi armed forces have acquired large numbers of tanks, large-calibre artillery, armoured personnel carriers, small arms and light weapons (SALW) as Chinese arms are the Bangladeshi Army’s weapon of choice while the Navy use Chinese frigates with missiles, missile boats, torpedo boats among others. China have also been supplying fighter jets and training aircraft to the Bangladeshi Air Force since 1977[16].

Very recently China and Bangladesh made crucial developments in security cooperation. The bilateral relations between the two countries have been elevated to ”Strategic Partnership of Cooperation”. The deal is aimed at intelligence sharing and counterterrorism activities, although other important matters such as cybercrime, militancy, transnational crimes, narcotics, fire service, and visa issues were also discussed during the signing of this major agreement[17].

Development cooperation/ Infrastructure development

Development cooperation is an integral part of the bilateral relations between China and Bangladesh. China has played a crucial role in the infrastructure development of Bangladesh over the years. It has assisted Bangladesh in building bridges, roads and railway tracks and power plants. The development assistance from China to Bangladesh and other developing countries mostly come as LOC’s. During a recent Bangladesh visit in 2016, President Xi Jingping promised US$24 billion in economic assistance to Bangladesh mainly as LOCs related to 24 projects[18].

China assisted Bangladesh in the construction of six bridges commonly known as the ““China- Bangladesh Friendship” bridges[19]. China also helped Bangladesh in constructing the Barapukuria coal-fired power plant located in Dinajpur in the North West of Bangladesh and was commissioned in 2006[20]. During Jingpin’s visit to Bangladesh in 2016, the countries signed agreements for two 1320 MW coal-fired power plants- one Payra, Patuakhali and the other in Banshkhali, Chittagong- making China the largest energy partner to Bangladesh overtaking India[21].

China has also provided economic assistance to Bangladesh in terms of free aid and token gifts. Two major agreements were signed in 2010 for establishing a fertiliser factory, and telecommunications network systems in Bangladesh- that were to be set up with a US$ 770 million LOC from China with a two percent interest rate payable within 20 years[22]. There had been discussions for several years on potential road and railway connections linking Chittagong with Kunming that would boost the economies of both the countries however that has not materialised as of yet[23]. Currently China is developing a 750-acre industrial park in Chittagong which will take five years to become fully operational and it will largely be used by Chinese manufacturing firms[24].

Conclusion

The good relations shared between China and Bangladesh have always been of mutual interests and both countries benefit from that. Although the growing relations between China and Bangladesh raise geopolitical tensions in the South Asia region and the Bay of Bengal, there should not be much doubt that China’s primary interest lies in the booming economy of Bangladesh, which has been ever so dependent on their bilateral trade relations. Bangladesh Prime Minister Sheikh Hasina has recently said that there is nothing to be concerned about for India while not explicitly mentioning China or any other country, and that Bangladesh need funds for the sole purpose of development and that she would welcome any country that is willing to invest in the country; she also urged India to maintain cordial relationship with all its neighbours[25]. Keeping close ties with Bangladesh will no doubt be hugely beneficial for China as the demand for oil and gas have risen largely owing to its growing industries, and having a strong geopolitical presence in the Bay of Bengal and the littoral countries could give them an advantage in terms of accessibility to various ports. On the other hand Bangladesh can only benefit from the cooperation with a major economic power as it has done so in terms of their diplomatic, economic and security affairs and would be keenly anticipating further developments in their bilateral cooperation.

[1] http://countrystudies.us/bangladesh/108.htm

[2] https://www.researchgate.net/publication/320546820_SINO-BANGLADESH_RELATIONS_AN_APPRAISAL

[3] http://countrystudies.us/bangladesh/108.htm

[4] http://siteresources.worldbank.org/EXTPREMNET/Resources/489960-1338997241035/Growth_Commission_Working_Paper_22_Economic_Reforms_Growth_Governance_Political_Economy_Aspects_Bangladesh_Development_Surprise.pdf

[5] https://www.orfonline.org/expert-speak/41935-decoding-china-bangladesh-relationship/

[6] Xinhua, 16 June 2010.

[7] “China pledges free market access”, The Daily Star, 19 March 2010.

[8] https://wits.worldbank.org/CountrySnapshot/en/BGD

[9] https://www.thedailystar.net/op-ed/politics/expanding-the-bangladesh-china-trade-frontier-1296583

[10] https://www.orfonline.org/expert-speak/41935-decoding-china-bangladesh-relationship/

[11] https://www.thedailystar.net/op-ed/politics/expanding-the-bangladesh-china-trade-frontier-1296583

[12] https://www.dhakatribune.com/opinion/op-ed/2018/05/18/free-trade-agreement-with-china-a-necessity

[13] https://www.thedailystar.net/opinion/more-just-facts/what-does-the-us-china-trade-war-mean-bangladesh-1604986

[14] https://thediplomat.com/2017/01/why-chinas-submarine-deal-with-bangladesh-matters/

[15] https://www.sipri.org/sites/default/files/2018-03/fssipri_at2017_0.pdf

[16] https://www.researchgate.net/publication/320546820_SINO-BANGLADESH_RELATIONS_AN_APPRAISAL

[17] https://www.dhakatribune.com/bangladesh/nation/2018/10/26/bangladesh-china-sign-3-agreements-on-security-cooperation

[18] https://www.orfonline.org/expert-speak/41935-decoding-china-bangladesh-relationship/

[19] https://www.researchgate.net/publication/320546820_SINO-BANGLADESH_RELATIONS_AN_APPRAISAL

[20] https://china.aiddata.org/projects/33957

[21] https://www.thethirdpole.net/en/2016/10/18/china-becomes-bangladeshs-largest-energy-partner/

[22] Rezaul Karim Byron, “$ 770 million Chinese loan tied with conditions”, The Daily Star, 28 September 2010.

[23] https://www.thedailystar.net/news-detail-259521

[24] https://www.reuters.com/article/us-bagnladesh-china/china-to-develop-bangladesh-industrial-zone-as-part-of-south-asia-push-idUSKCN1HB1M2

[25] https://economictimes.indiatimes.com/news/politics-and-nation/india-need-not-worry-about-bangladesh-china-ties-sheikh-hasina/articleshow/63037906.cms

Iran’s Toughest Sanctions

Why is the United States imposing the “toughest sanctions in history” on Iran?

In 2018 November the United States re-imposed full sanctions on the Islamic Republic of Iran following Donald Trump’s withdrawal from the Iran nuclear accord back in May. The US has vowed to impose and maintain the “toughest sanctions in history” on Iran.

For its part, the Iranian president Hassan Rouhani has struck a defiant tone vowing to “break” the sanctions. But the reality is Iran is facing an economic siege which threatens to create instability with potentially far-reaching social and political consequences.

Realistically, there are three potential scenarios at this stage. First is that Iran hunkers down to manage the embargo by using innovative ways to evade some of the sanctions. The Iranians will be hoping to out-last Trump, whose first term expires in January 2021. However, this strategy falls apart if (as it looks increasingly likely) Trumps secures a second term in office.

The second scenario is that Iran caves in and agrees to negotiate a new deal on Trump’s terms. As Trump has repeatedly made clear the US is seeking a new deal which not only radically renegotiates the terms and conditions of the existing deal – known as the Joint Comprehensive Plan of Action (JCPOA) – but expands it to include restrictions on Iran’s ballistic missiles programme and changes to its regional policy.

The third (and worst) scenario is that tensions do not remain at the sanctions or economic level, but that they escalate, leading to indirect and possibly even direct clashes between Iranian and American forces in the Middle East. In this scenario the provocative actions of Washington’s key allies, notably Israel and Saudi Arabia, is crucial. Iran may strike these countries directly if it perceives an intolerable provocation or it comes to believe it can force an American retreat by striking at its allies.

But how did we get to this place in the first place?

History of Iran-US relations

Prior to the 1979 Iranian revolution, the United States and Iran were allies and Washington looked to Iran to maintain peace and stability in the Persian Gulf arena. But following the revolution the new revolutionary regime in Tehran found itself at odds with the US and relations rapidly deteriorated.

The climax came with the seizure of the US embassy in Tehran by revolutionary students in November 1979 under the pretext that the embassy was a “den of espionage” and to that end it was actively working against the Iranian revolution.

The real reason relates to the US decision to grant entry to the former Shah of Iran whom the revolutionaries wanted extradited to stand trial in Tehran. There was a real fear back then that the US would attempt to reinstall its former ally by overthrowing the Iranian revolution.

This fear brought back memories of the August 1953 coup (orchestrated by the CIA and Britain’s MI6) which overthrew Iran’s first democratically elected government – led by the nationalist Prime Minister Mohammad Mosaadegh – and reinstalled the Shah who had fled to Rome (Italy).

The August 1953 coup which overthrew Mossadegh was a pivotal moment in Iran’s modern history. Mossadegh was not only democratically elected but more importantly he was an icon of Iranian nationalism and was admired by nationalists across the region and beyond. It was Mossadegh’s decision to nationalise Iran’s oil industry – which had hitherto been in the clutches of the British “Anglo-Iranian Oil Company” (later renamed British Petroleum) – which had set him on a collision course with the Western powers led by Britain.

Mossadegh’s overthrow, followed by the instalment of Mohammad Reza Pahlavi as Shah, set the stage for the Iranian revolution 25 years later. It was based on this history – i.e. the US role in reinstalling the Shah and helping him to consolidate his rule for the next quarter of a century – that the Iranian revolutionaries staked out an oppositional stance vis-à-vis the United States.

Following the seizure of the US embassy in November 1979 bilateral relations were severed and the US began the long process of sanctioning virtually every aspect of the Iranian economy. The first sanctions targeted Iranian imports into the US. In addition, the US government froze $12 billion in Iranian assets. Hitherto these funds remain frozen and Iran not only seeks their return but also wants 40 years of interests to be taken into account as well.       

The next round of big sanctions came into effect 15 years later during the presidency of Bill Clinton. The latter sanctioned Iran’s oil industry by preventing US companies from investing in the Iranian oil and gas sector. A year later in 1996 the US congress went further by passing a law targeting foreign firms which invested more than $20 million a year in the Iranian energy sector.

This was the first time the US was using its clout to target non-US entities who did business with Iran. As such it was a significant escalation in America’s economic war against Iran and in hindsight it prepared the groundwork for today’s far-reaching sanctions regime.

The next round of sanctions was multilateral in nature in so far as they were prompted by United Nations Security Council (UNSC) resolutions targeting specific features of Iran’s nuclear programme, notably uranium enrichment. The UNSC imposed its first round of sanctions – mostly targeting the nuclear sector – in December 2006.

But the US imposed additional sanctions on top and used the opportunity created by international concerns over Iran’s controversial nuclear programme to widen and deepen its own sanctions regime against the Islamic Republic.

Indeed, in October 2007, the US directly sanctioned Iran’s powerful Islamic Revolutionary Guards Corps (IRGC) by designating its expeditionary wing, known as the Qods (Jerusalem) force as a terrorist organisation.

Moreover, in June 2010, the US exploited the international climate following the UNSC’s imposition of the fourth round of sanctions on Iran, to further target Iran’s energy and banking sectors. Then in January 2012 Washington went a step further by sanctioning Iran’s central bank.

Following the signing of the landmark nuclear deal in July 2015, much of the complex web of unilateral and multilateral sanctions that had been imposed on Iran since December 2006 were gradually eased but never fully lifted. However, the US kept in place its non-nuclear related unilateral sanctions, including wide-ranging sanctions against the IRGC on account of its alleged support for “terrorism”.

By withdrawing from the nuclear deal, the US is not only seeking to reimpose full sanctions, but is in fact going a step further by pledging to reduce Iranian oil exports to “zero”. This is a massive provocation and if the US comes anywhere near to achieving its goal then a confrontation with Iran is guaranteed.

Do Iran and America talk directly?   

In view of this bitter 40-year history, viewers would be excused in thinking that Iran and the United States rarely (if ever) talk directly. Whilst it is true that the two powers broke off diplomatic relations in late 1979 and have had no direct diplomatic representation on each other’s soils, nevertheless direct talks and even deals have materialised intermittently.

The best early example was the “Iran Gate” scandal of 1986 when the US government illicitly sold arms to Iran (in violation of its own arms embargo on the Islamic Republic) so as to secure the release of US hostages in Lebanon. The scandal had an additional illicit layer as the funds from the deal were transferred to the “Contras” rebels in Nicaragua who were fighting the leftist Sandinista government led by Daniel Ortega.

More recently Iran and the US engaged in secret talks in Muscat (Oman) in 2013 on finding a way out of the impasse presented by Iran’s nuclear programme. These secret meetings soon gave way to direct bilateral meetings between Iranian foreign minister Mohammad Javad Zarif and his former US counterpart John Kerry.

It is also worth noting that Iranian and US envoys met directly in Baghdad in July 2007 to agree to a de-escalation in the Iraqi arena. At the time Iran was accused by the US of arming anti-American militants who were resisting the US-led occupation. Although this meeting didn’t produce a breakthrough, nevertheless it showed that even under the most adverse circumstances – when Iran and the US are fighting each other indirectly via proxies – they can still meet with a view to de-escalation.

Why talks are unlikely now

Donald Trump has called for direct talks with Iranian leaders, notably President Hassan Rouhani, on several occasions. On each occasion the Iranians have publicly rebuffed his outreach on the grounds that it is spurious and insincere.

Iran’s position is clear: namely that the current nuclear deal (JCPOA) is fit for purpose and consequently Iran will not be forced to renegotiate its terms and conditions. Moreover, the 12 list of demands issued by the US secretary of state Mike Pompeo back in May are effectively a call for surrender as compliance would mean Iran effectively giving up its independent foreign policy.

Amongst other demands, Pompeo wants Iran to fully withdraw from Syria, stop supporting Hezbollah and cease playing a role in the Yemen conflict. Clearly the Iranians will never agree to these terms and to that end Pompeo’s list of demands was an incitement to confrontation as opposed to a credible negotiating position.

Will Iran and the US go to war?

To many observers it is surprising that given the depth of hostility between Iran and the US, as reflected by the events of the past four decades, the two sides have not gone to war yet. It is worth noting that the two sides have clashed militarily but stopped short of declaring war.

The most intense clash occurred in April 1988 when in the course of one day – during Operation Praying Mantis – the US destroyed a quarter of the Iranian navy. This operation was part of a broader US effort to pressure Iran into accepting a ceasefire with Iraq in the long-running Iran-Iraq War.

The power differential between the US and Iranian militaries is one of the factors that military analysts cite to explain Iran’s reluctance to engage the US militarily. But Iran has come a long way since the late 1980s and the Iranian armed forces – in particular the IRGC – have developed a wide range of asymmetric capabilities and tactics which could be used to great effect against superior military powers.

Iran’s asymmetric capabilities – in addition to the Islamic Republic’s extensive reach and influence across the Middle East – makes the US reluctant to engage Iran militarily for fear of unintended consequences.

Nevertheless, despite both sides’ reluctance to go to war, a conflict could still break out either as a result of the cumulative effect of tensions or a mistake or misunderstanding which escalates suddenly and without warning.

The next two years are the most crucial yet in the 40-year standoff between Iran and America.               

 

Why is Israel cultivating ties with Oman?

In late October the Israeli Prime Minister Benjamin Netanyahu visited Oman, the sleepy Sultanate on the south-eastern edge of the Arabian Peninsula. Whilst the visit is consistent with Israel’s thawing relationship with a number of Arab countries, including Egypt and the Gulf states, nevertheless the visit to Muscat took observes by surprise.

That is mainly because Oman has been traditionally close to Iran, a deep-rooted relationship which tends to get stronger when Iran comes under severe pressure, as it is now with the re-imposition of tough and far-reaching US sanctions.

Therefore, by embracing Israel, Oman is risking its strong and fruitful ties to Iran, a political and strategic risk which Oman can ill afford in the long term.

The Geopolitics of Oman

Unlike some of her Gulf neighbours Oman has a long and proud history. Back in the 18th century the Sultanate of Oman successfully competed with Britain, Portugal and Iran for influence in the Persian Gulf, the Gulf of Oman and the Indian Ocean. The country has been more or less independent since the middle of the 16th century.

From a political point of view, the country is distinctive by the fact that it was ruled for a long time by an Imamate system based on the al-Ibadiyyah school of Islam. A derivative of the original Khawarij tendency, the al-Ibadiyyah survives only in Oman and small pockets in North Africa, notably Algeria.

Oman’s Ibadi identity is central to the country’s geopolitical profile. It sets Oman firmly apart from her Gulf neighbours which to varying degrees, and at an official level, follow a Wahhabi interpretation of Islam. It also sets it apart from Yemen and the Iranian Shia giant across the Gulf.

The Ibadi faith has also had a profound impact on Oman’s domestic politics and associated socio-economic and cultural institutions. In the popular imagination Oman is often characterised as a sleepy, benign and insular society. Regular travellers to Oman would likely attest to this description of the Sultanate.

Oman’s Foreign Policy

The guiding principles of Oman’s foreign policy was set down firmly in the 1970s. Up to that point and for much of the 20th century Oman was too consumed by internal division and strife to formulate and implement an effective foreign policy. This was a far cry from Oman’s role in previous centuries as a small empire on the edge of the Arabian Peninsula.

The turning point in the late 20th century came in the form of the so-called Dhofar rebellion (referencing the Omani province by that name) spearheaded by Marxist-Leninist rebels. The embattled Omani state finally managed to defeat this determined rebellion primarily with the help of British and more importantly Iranian military support (more on this later).

The most important point about the Dhofar conflict and its aftermath is that it forced the Omani ruling system to undertake deep and far-reaching structural and institutional reforms to elevate it to a level consistent with 20th century standards. For the first six decades of the 20th century Oman was essentially stuck in the past and barely functioning under the burden of obsolete institutions and associated policies.

The defeat of the rebellion in 1976 heralded the emergence of a unified and coherent Omani state which had both the confidence and the means to play an important role in its immediate external environment.

At that point Oman’s ruler Sultan Qaboos bin Said al-Said chose to adopt a balancing and mediatory role in regional and foreign policy. By all credible accounts, Sultan Qaboos is a wise and far-sighted leader who has expertly mobilised the resources of his small country to exert maximum influence in the regional environment, notably in relation to Yemen, Saudi Arabia, the wider Gulf region and Iran.

Broadly speaking, there are three important strands to Oman’s foreign policy, namely its membership of the Gulf Cooperation Council (GCC), relationship with Iran and enduring ties to the United Kingdom. To understand Muscat’s place in the world it is vital that we undertake an in-depth examination of these three important dimensions of Omani foreign policy.

Oman and GCC: a reluctant member?

Oman joined the GCC at its inception in 1981 and has been an active member of its various branches and committees since. But this active participation does not necessarily mean full acquiescence to the general thrust of GCC policies. As it is now widely known the GCC has been reduced to essentially a vehicle for the promotion of Saudi Arabia’s, and to a lesser extent, the United Arab Emirates’, positions and interests in the Persian Gulf region.

But Oman dissents from this Saudi-UAE driven agenda in three important respects. Foremost, Oman is opposed to Saudi’s hostile policy on Iran and does not want the GCC to be used as a forum to push this agenda.

Second, Oman is officially neutral in the spat between the GCC (plus Egypt) and Qatar. But privately Oman harbours sympathy for Doha’s position and supports its balancing role vis-à-vis Saudi Arabia. Just like Qatar, Oman has much to lose if Saudi Arabia achieves its goal of establishing primacy in the Gulf region.

Third, Oman is opposed to the Saudi-UAE led war on Yemen both on humanitarian and geopolitical grounds. Oman shares a border with Yemen and stands to be deeply affected if Yemen disintegrates altogether. In order to blunt the effectiveness of the Saudi-Yemeni led war, Oman has reportedly gone to the extent of facilitating arms transfers to the Ansarullah movement, also known as the Houthis.

Oman and Iran: A Special Relationship

As stated earlier, Iran intervened militarily in the early and mid-1970s to help Oman defeat the Marxist-Leninist rebellion in Dhofar. This intervention was made by the former Shah of Iran whose goal was to act as the policeman of the Persian Gulf at the behest of America.

The Shah was overthrown in the 1979 Iranian revolution but the Omani ruler, Sultan Qaboos, never forgot Iran’s decisive military intervention in the Dhofar conflict. The Sultan knew very well that absent that intervention Oman would have likely disintegrated as a cohesive state and he would have lost his crown.

For this reason, Oman continued to maintain warm ties with revolutionary Iran thus qualifying as the only regional state whose relations with Iran were not upset or altered as a result of the Iranian revolution.

Oman’s simultaneously good ties with Iran and the West has enabled it to play a mediating role, particularly between Iran and the United States. For instance, Oman hosted secret talks between Iran and the US in 2013 on Iran’s nuclear programme. These talks sowed the seeds which eventually bloomed into the landmark nuclear accord of 2015.

Oman’s deep links with Britain  

In the modern period British influence in Oman was consolidated by the Treaty of Seeb (1920) which formalised Oman’s partition into two distinct regions, a coastal state and an autonomous interior.

The British continued to maintain influence in the latter part of the 20th century as demonstrated by the UK military intervention in the Dhofar conflict. At that point the British army struck up an enduring partnership with its Omani counterpart. This is foremost embodied by the “Swift Sword” series of manoeuvres, with the latest held in October 2018.

The British influence over Oman’s armed forces is the clearest indicator that ultimately Oman looks to the West for safety, security and survival.

Oman’s ties with Israel

Whilst Netanyahu’s visit to Muscat caught observers by surprise, it is important to note that Oman has had important contacts with Israel for more than two decades. The late Israeli Prime Minister Yitzhak Rabin visited Oman in late 1994, setting off a diplomatic engagement which produced an “agreement” just over a year later.

Moreover, Netanyahu’s visit was preceded by Israeli officials’ visit to Abu Dhabi and Dubai in the United Arab Emirates, leading the BBC to celebrate the “warming up” of Israeli-Arab ties after a “long deep freeze”.

Whilst the symbolism of Netanyahu’s visit to Muscat is important – in so far as it further erodes the taboo surrounding Israel in the Muslim world – in practical terms the Israeli Prime Minister was pursuing a narrow agenda during his eight-hour stop in the Omani capital. Most likely much of the content of his meeting with Sultan Qaboos revolved around Israel’s arch-foe Iran.

Israel is agitating for a full-frontal diplomatic, political, economic and potentially military assault on Iran. Israeli pressure played a decisive role in the Trump administration’s decision to abandon the landmark nuclear accord and by extension to re-impose harsh sanctions on Iran.

Beyond the US-led sanctions regime, Israel is trying to align more and more with Saudi Arabia with a view to creating a regional block against Iran. Oman stands in the way of that potential coalition.

Whilst Netanyahu cannot hope to turn Oman against Iran, but at minimum he aspires to enlist Oman’s help in thwarting Iran’s sanctions busting activities. As sanctions begin to bite Iran traditionally turns to friendly countries to help it evade certain sanctions or act as intermediaries with countries and entities who cannot afford to be seen to be doing direct business with the Islamic Republic.

Oman’s geographic position at the mouth of the Arabian Peninsula and the gateway to the Persian Gulf makes it critical to Iranian sanctions-busting activities, particularly in relation to the sale of oil and other petroleum products.

Conclusion: will Oman cave into Israeli pressure?

The Omani ruler and his inner circle probably view their outreach to Israel as part of their balancing and mediation role in the region. These are the guiding principles of Oman’s foreign policy. Based on these principles, Oman strives to be on good terms with all regional powers.

But the Omani leadership also places a premium on loyalty and longevity. Oman’s special relationship with Iran is nearly fifty years old and as stated earlier the Omani ruler continues to feel deeply indebted to Iran for that country’s decisive role in safeguarding Oman’s territorial integrity and sovereignty back in the 1970s.

Furthermore, the Omani ruler is known to take the long view, a feature cemented by his nearly 50-year rule. It is plausible that he thinks that eventually Iran and the United States are going to strike a “grand bargain” to begin the process of normalisation. In view of its established role as a mediator Oman hopes to play a big role in that reconciliation process.

In the final analysis, leaving Iran aside, there is no getting away from the symbolic importance of Netanyahu’s visit. The symbolism assumes even greater significance when set against the backdrop of Rabin’s visit to Muscat twenty-four years ago. On current trajectory Oman is on course to develop full-fledged ties with the Jewish state.  

Bangladesh-India relations: towards a stronger alliance?

Bangladesh and India have been allied more or less since their inception despite having minor disputes on certain issues. The current Bangladeshi ruling party have taken Indo-Bangladeshi relations to the next level since they came to power in 2009 (who are now serving their second term with elections in a couple of months), reaching major milestones in security cooperation as well a massive upsurge in bilateral trade.

History

Bangladesh is surrounded by India from the North, West and much of the East with the Bay of Bengal in the South and Myanmar in the South-East. The border between Bangladesh and India covers a staggering 4,095 kilometres with West Bengal having the largest share of 2217 kilometres[1].

Both countries have close cultural ties, most significant of which perhaps would be language- i.e. Bengali. The main official language of India’s West Bengal is Bengali, spoken by over a 100 million people, which also happens to be the only official language of Bangladesh. On the other hand, Hindi and Bengali have same roots in the Sanskrit language which causes them to have many similarities and enables ease of learning.

Bangladesh had been part of British India until 1947, after which it was annexed as part of Pakistan (Bangladesh was known as East Pakistan, the West Pakistan was the Pakistan of today). However, after a 9-month long war of liberation Bangladesh gained independence in 1971 and subsequently joined the Commonwealth of nations in 1972[2], and the United Nations in 1974.[3] India had been an independent state since the end of the British Empire, with a history of complex and largely hostile relations with Pakistan due to a number of historical and political events.

Bangladesh have had friendly relations with India throughout much of their history. India has provided significant assistance to Bangladesh in their War of Liberation against Pakistan in 1971 in terms of military support and firepower. However, it must be noted that ever since the British left in 1947, India have always had a volatile relationship with Pakistan and they acted in their own best interests as they felt threatened with the geographical presence of Pakistan from the East and the West. Consequently, India was the first country to recognise Bangladesh as an independent state immediately afterwards.

Bangladesh has a moderate foreign policy that places multilateral diplomacy as one of its core initiatives. Ambassador of Bangladesh to the U.S., Mohammad Ziauddin stated in 2009 that Bangladesh’s foreign policy is based on the Father of the Nation Sheikh Mujibur Rahman’s dictum, “Friendship with all and malice towards none”, with the ruling party leader Sheikh Hasina and Prime Minister of Bangladesh being the daughter of Sheikh Mujibur Rahman.[4]

Trade

The first trade agreement between the two countries was signed in 1972 and trade volume is staggering as of today. According to the some of the most recent available figures, Indian exports to Bangladesh totalled $4.5 billion between July 2016-March 2017 while Bangladesh exports to India was worth $672.40 million during the Fiscal Year 2016-17. India have also extended three Lines of Credits (LOCs) between 2010-2017 worth up to US$ 8 billion, making Bangladesh the largest recipient of Indian LOC’s.[5]

Today, Bangladesh is home to the fastest growing megacity in the world- Dhaka; while the country also boasts one of the fastest growing economies in the world, with a GDP growth rate averaging over six percent annually over the past ten years or so.[6] On the other hand, India is the most populous democracy boasting the sixth largest economy in the world by nominal GDP.[7]

Major Disputes in Bangladesh-India Relations

Despite good relations there have been disputes over borders throughout history, and it was not until June 2015 that many of the long-lasting disputes were largely settled.[8] Other significant disputes include maritime claims over seawater at the Bay of Bengal.

Border Dispute: One of the most discussed topics in their recent bilateral relations had been the border killings of Bangladeshi citizens along the Indo-Bangladesh border by India’s Border Security Forces (BSF) with their apparent “shoot-to-kill” policy in which the Human Rights Watch claimed had killed nearly 1,000 people (Bangladeshi citizens) between 2001-2011.[9] Indian officials have argued that the reason for the attacks were largely due to increasing illegal migration of Bangladeshis into India as well as persistent misuse of borders by illicit traders.[10]

River Dispute: Another major dispute concerns the sharing of the River Teesta. Teesta is one of the 54 rivers shared by Bangladesh and India[11]. This river originates in Sikkim and flows through the North of West Bengal and meets Brahmaputra river in Bangladesh[12]. The countries reached agreement on sharing the river for the first time in 1983 according to which the share of water was (as follows): India- 39%, Bangladesh- 36%, Unallocated -25%. However in recent years Bangladeshi has been asking for an equitable share. Water disputes between the two countries have existed for quite a long time throughout history. Notably it took 20 years to end the Ganges river dispute in 1996. In 2011 an interim deal that was supposed to last the 15 following years increased the share of India to 42.5 per cent and that of Bangladesh to 37.5 per cent. But to the disappointment of Bangladesh as well as India, it never materialised, largely due to the government of West Bengal refusing to sign due to concerns of the northern region drying out[13]. Despite planning failure being regarded as one of the main reasons for not having reached an agreement as of yet, there are other underlying reasons why things haven’t materialised. There is no denying that Bangladesh do need their share of water, with the Asian Foundation reporting in 2013 that Teesta’s flood plain covers 14 per cent of the total cropped area of Bangladesh provides direct livelihood opportunities to approximately 73% of its population[14]. On the other hand, the River Teesta plays a major role in the Northern Bengal while nearly half a dozen districts in the entire West Bengal state are dependent on it.[15]

Government stance:

The previous Bangladesh Nationalist Party (BNP) government did not have strong alliance with India and thus were not quite receptive to India’s concerns. They had also garnered opposition from India due to providing refuge to  leaders and members of some of the North Eastern nonstate actors/militias. However due to their close relations, the current ruling party have largely followed India-friendly policies while taking India’s side on their fight against North Eastern separatists.[16] In spite of all these, Delhi closely anticipates an agreement for the sharing of River Teesta which they believe would give them political leverage over the apparent rising influence of China in the Bay of Bengal.[17]

Awami League/Ruling party relations with India

The current ruling party led by Sheikh Hasina has had a strong alliance with India ever since they came to power in 2009, with major acts of cooperation taking place in the subsequent years. Bilateral relations of the two countries had never been better as it has been over the past decade or so. Prior to 2017, there were no formal mechanisms in place for any significant security cooperation, but that changed in 2017. As Sheikh Hasina made a special visit to India in 2018 which resulted in the signing of a MoU on the framework for defence cooperation. That paved way for improved cooperation between the armed forces of both the countries, with MoU’s signed for cooperation ranging from joint military exercises, sharing of strategical operations studies for the Defence Services Command and Staff colleges, coast-guard cooperation between the two countries to an extension of line of credit worth US$500 million for the purchase of defence equipment from India.[18]

One of the major deals was the Rampal Power Plant which is a proposed 1320 Megawatt coal-fired power station in Khulna region, Bangladesh which is a joint-venture between the Bangladesh Power Development Board and India’s National Thermal Power Corporation.[19] However the signing of the deal was subject to much controversy due to the proposed site being only 14 kilometres North of the worlds largest mangrove forest, the Sundarbans which happens to be a UNESCO world heritage site.[20] It received attention in the local as well as the international arena because the project violates the environmental impact assessment guidelines for coal-based thermal power plants.[21] Environmental experts have expressed major concerns due to the close its proximity to the Sundarbans, while there have been campaigns by The National Committee on Protection of Oil, Gas, Mineral Resources, and Power-Port, and environmentalists against the proposed project. Despite all the protests, the Bangladeshi government have consistently denied all claims and allegations about the negative environmental impacts of the Rampal project. The project has been under way for a while now however little progress have been made.[22]

Conclusion

In September 2018 Bangladesh signed a MoU with India which would let the latter use two of Bangladesh’s major ports– Chittagong and Mongla[23]. Bangladesh and India are two of the major economies of South Asia and their relationship will have a lasting impact on the region’s development. While India has the potential to emerge as a major world power competing with the likes of China and the U.S, Bangladesh may also have a role to play in their development. With the Bangladeshi general elections coming up, the Awami League are favourites to get re-elected, while it is the same for BJP, with PM Narendra Modi expected to remain PM should they win again, the relations between India and Bangladesh are likely to get better and better, with the only worry for India being China’s increasing cooperation with Bangladesh.

References

[1] https://www.hindustantimes.com/india/5-things-to-know-about-india-bangladesh-ties-from-trade-to-security/story-qgVND0mAQ4S1DpmYpzd5lJ.html

[2] “Bangladesh Joins Commonwealth”. Edmonton Journal. Edmonton, Alberta, Canada. 19 April 1972 – via Google News.

[3] “United Nations: Palestinian Position Becomes Critical Issue”. The Citizen. Ottawa, Ontario, Canada. 18 September 1974 – via Google News.

[4] https://www.belfercenter.org/publication/south-asia-week-bangladeshs-policy-priorities-and-its-relationship-united-states-and

[5] https://www.mea.gov.in/Portal/ForeignRelation/Bangladesh_September_2017_en.pdf

[6] Trading Economics, 2018, Bangladesh GDP Growth Rate. <https://tradingeconomics.com/bangladesh/gdp-growth>

[7] “India becomes world’s sixth largest economy, muscles past France”. Archived from the original on 9 August 2018

[8] Serajul Quadir (6 June 2015). “India, Bangladesh sign historic land boundary agreement”. Reuters India.

[9] “India/Bangladesh: Indiscriminate Killings, Abuse by Border Officers”. Human Rights Watch. December 9, 2010; “India’s shoot-to-kill policy on the Bangladesh border”. The Guardian. 23 January 2011; “Khaleda Zia assures counter-terror co-operation to India”. Yahoo News. Indo Asian News Service. 2012-10-29

[10] “Khaleda Zia assures counter-terror co-operation to India”. Yahoo News. Indo Asian News Service. 2012-10-29

[11] https://www.hindustantimes.com/india/5-things-to-know-about-india-bangladesh-ties-from-trade-to-security/story-qgVND0mAQ4S1DpmYpzd5lJ.html

[12] https://timesofindia.indiatimes.com/india/the-teesta-river-dispute-explained-in-10-points/articleshow/58091320.cms

[13] https://www.business-standard.com/article/current-affairs/teesta-has-one-sixteenth-of-water-needed-for-agriculture-117041500257_1.html

[14] https://www.clearias.com/teesta-river-dispute/

[15] https://www.clearias.com/teesta-river-dispute/

[16] https://www.clearias.com/teesta-river-dispute/

[17] https://www.clearias.com/one-belt-one-road-obor/

[18] https://www.orfonline.org/research/india-bangladesh-defence-cooperation-coming-of-age-at-last/#_edn2

[19] “Indo-Bangla joint company for power import”. The Independent. Dhaka. 8 March 2011.

[20] Rahman, Khalilur (24 February 2013). “Demand for Rampal power plant relocation”. Financial Express. Dhaka.

[21] Kumar, Chaitanya (24 September 2013). “Bangladesh Power Plant Struggle Calls for International Solidarity”. The Huffington Post.

[22] https://thewire.in/south-asia/rampal-power-project-sundarbans-india-bangladesh; https://www.dhakatribune.com/business/2018/01/21/little-progress-large-coal-fired-power-plant-projects

[23] “Transporting Goods to 7 Sisters: Dhaka to let Delhi use Ctg, Mongla ports”. The Daily Star. Dhaka, Bangladesh. 18 September 2018. < https://www.thedailystar.net/frontpage/news/carrying-goods-7-sisters-dhaka-let-delhi-use-ctg-mongla-ports-1635397>

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