Recently, Prime Minister Sheikh Hasina of Bangladesh hastily resigned amid a coup and fled to India. During Hasina’s tenure, Bangladesh maintained a close relationship with China and benefited from substantial investments from China. Some scholars believe that Hasina’s escape will bring uncertainty to China’s large-scale infrastructure projects under the Belt and Road Initiative in the country.
On August 5th, a coup took place in Bangladesh. Chief of Army Staff Waker-uz-Zaman announced on television that Prime Minister Hasina had resigned and fled to India, and the interim government would take over. In the weeks leading up to this, Bangladesh saw multiple incidents of clashes between police and civilians as protesters opposed Hasina’s government’s violent crackdown on student protests, leading to ongoing turmoil.
At 76 years old, Hasina is the eldest daughter of Sheikh Mujibur Rahman, the founding president of Bangladesh. She first served as Prime Minister from 1996 to 2001. Since 2009, Hasina has won four consecutive elections and served as Prime Minister for 15 years, making her one of the longest-serving female leaders in today’s international political arena.
While Hasina won this year’s election, it faced a boycott from the major opposition, the Bangladesh Nationalist Party. Hasina has been accused of suppressing opposition and dissenters, orchestrating disappearances, and arranging extrajudicial executions. Critics argue that her rule has been increasingly authoritarian.
Bangladesh, with a population of approximately 170 million, holds a strategic location between Myanmar and India. It shares borders with India to the east, west, and north, borders Myanmar to the southeast, and is bordered by the Bay of Bengal to the south.
Historically, the Bengal region has seen various iterations of independent states. By the 16th century, Bengal had become the most populous, economically developed, and culturally vibrant region on the Indian subcontinent. In the mid-18th century, Bengal became the center of British colonial rule in India, and in the late 19th century, it became a province of British India.
In 1947, the partition of India created the Dominion of India and the Dominion of Pakistan. This division also split Bengal: West Bengal became part of the Dominion of India, while East Bengal became part of the Dominion of Pakistan. East Bengal later became East Pakistan, which eventually became present-day Bangladesh.
From July 8 to 11 this year, Hasina had just visited Beijing, meeting with top Chinese leaders including Xi Jinping, Li Keqiang, Wang Huning, and Wang Yi.
Chinese Ambassador to Bangladesh Yao Wen described Hasina’s visit as a “historic visit” and stated that it would “push forward new achievements in China-Bangladesh strategic cooperation, taking it to a new level.”
During the visit, Hasina signed 28 bilateral agreements with China, primarily focusing on trade and investment. The official joint statement from China mentioned advancing existing large-scale infrastructure cooperation projects under the Belt and Road Initiative. The two countries also reached agreements on financial cooperation, giving Bangladesh zero-tariff treatment on 98% of its export products.
Prior to Hasina’s visit to Beijing, Abdul Rouf Talukder, Governor of the Central Bank of Bangladesh, told the media that Bangladesh was negotiating a loan of around $5 billion with China to bolster its decreasing foreign exchange reserves. This fund, denominated in Chinese yuan, is intended to provide financing for exporters to pay for urgently needed raw materials imported from China.
Local Bangladeshi media reported that China intends to provide trade assistance equivalent to $5 billion to Bangladesh in the form of local currency credit, while Bangladesh hopes to secure $7 billion.
In an effort to alleviate poverty and seek external assistance, the Bangladeshi government actively sought to develop its relationship with the United States. The U.S. considers Bangladesh a significant “moderate Muslim” populous nation with strategic regional importance and has been its largest trade and investment partner, providing over $8 billion in aid to date. In recent years, leaders and senior officials from both countries have maintained close contact.
Bangladesh also attaches importance to improving and developing its relationship with India. During Hasina’s tenure, leaders of both countries have visited each other multiple times. Just weeks before Hasina’s visit to China earlier this year, she had visited India. The two countries signed 10 agreements and memoranda of understanding and announced over a dozen other initiatives covering areas such as connectivity, health, trade, energy, defense, and maritime cooperation.
While Bangladesh maintains developing partnerships with the United States and India, the closeness between the Hasina government and China has been prominent, with China significantly involved in major infrastructure projects in Bangladesh. Hasina’s departure signifies China losing an important partnership.
Bangladesh became the first country in South Asia to join China’s Belt and Road Initiative through a special project in 2015, known as the Bangladesh-China-India-Myanmar Economic Corridor (BCIM), formally confirmed during Xi Jinping’s visit to Dhaka in 2016.
In 2016, China and Bangladesh signed loan agreements exceeding $24 billion, the largest foreign credit line Bangladesh has acquired.
By 2022, China had become Bangladesh’s largest foreign direct investor, with investments nearly reaching $1 billion – a 40% increase from 2021 – constituting 65% of total investments in Bangladesh. In South Asia, Bangladesh only follows Pakistan in terms of Chinese investment.
Under the Hasina government, Bangladesh maintained close ties with China. Bangladesh sought China’s support for its development, while China consolidated its position in the region through significant investments.
China has played a crucial role in Bangladesh’s infrastructure development, including projects such as roads, bridges, railways, power plants, and ports. For example, the construction of the Padma Bridge stands as a prime example, being the largest infrastructure project in Bangladesh’s history.
These projects are part of China’s Belt and Road Initiative. Over the years, China’s economic investments in Bangladesh have totaled around $40 billion. However, the future of these projects now faces uncertainty.
On August 7th, Associate Professor Sun Guoxiang of the Department of International Affairs and Business at Nanhua University in Taiwan stated in an interview with Epoch Times that China is trying to compete with the United States by investing in infrastructure projects in developing countries. However, the Belt and Road Initiative is essentially an early form of overcapacity. China expands its influence in developing countries through these investments but claims these as overseas interests once the infrastructures are completed.
Sun Guoxiang mentioned that China has been continuously vying for regional influence with India in South Asia. Many developing countries that accept Belt and Road investments face unstable political situations. When these countries undergo regime changes, new governments may not recognize agreements signed with China by their predecessors.
He noted that China’s Belt and Road construction in developing countries has not stabilized political situations or created more economic opportunities. Instead, it has exacerbated debt traps and further destabilized political environments.
Feng Chongyi, a China studies expert and Associate Professor at the University of Technology Sydney in Australia, told Epoch Times that political relations between the Bangladeshi government and the Chinese government have always been closely intertwined, with mutual support on the international stage. Given Hasina’s close relationship with China, students and dissenters in the country naturally view China as an adversary. With the political change in Bangladesh, the incoming democratic government will likely review China’s Belt and Road projects, potentially halting or renegotiating them.
In 2013, Xi Jinping launched the Belt and Road Initiative, involving substantial Chinese financing for infrastructure projects in Africa, Europe, and the Indo-Pacific region. However, this approach has faced significant controversies in recent years. Many Belt and Road projects have encountered sustainability issues due to unsustainable debt problems.
According to official Chinese data, 152 countries have signed Belt and Road agreements, with nearly $1 trillion invested in over 3,000 projects. Despite this, the global spread of the COVID-19 pandemic has inflicted heavy blows on economic sectors such as tourism in many countries and brought significant changes to the world financial markets.
Most Belt and Road projects struggle to recover investments, compounded by poor fiscal management in these countries, leading to debt crises. China uses these countries’ defaults to further advance its strategic goals.
Dr. Deepak Vohra, a former Indian senior diplomat, Ambassador to Poland, and advisor to governments in Africa, previously labeled the Belt and Road Initiative as the “biggest scam of the century.” He stated that China has spent over a trillion dollars to reconfigure the global business architecture through globalization. Xi Jinping aims to absorb some poor weak countries.