External relations of Bangladesh

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Left leaning politicians and intellectuals of Bangladesh commonly propagate that India is an eternal friend and Pakistan is a perpetual enemy. The right leaning counterparts are not as warm towards India and are much more forgiving of Pakistan’s war time atrocities. This commentary suggests that such polarisation of external relation may serve the narrow political interests of the left and right combatants, but is hardly pragmatic and conducive for Bangladesh.

First, in terms of trade and economics, clearly India is potentially much more important than Pakistan. However, the reality is that India exports much more to than imports from Bangladesh. Since the 1990s, India’s exports to (imports from) Bangladesh grew at over 9% (3%) per annum helped in part by the depreciation of Indian currency (World Bank, 2006, India-Bangladesh Bilateral Trade and Potential Free Trade Agreement). India accounted for 6% (12%) of Bangladesh’s total exports (imports) in 1973 and this share changed to 2% (14%) in 2011, implying a decrease in trade importance of India from the Bangladesh perspective (FICCI, 2012, Status Paper on INDIA-BANGLADESH ECONOMIC RELATIONS). Meantime, China, Japan and other Asian countries have become vital import sources for Bangladesh to sustain and grow its exports lifeline to Europe and United States. Another critical catalyst for the economic development of Bangladesh is the export of labour services to the Middle East.

In terms of development partnership in the form of food, commodity and project aid (grants and loans) during 1971/72 to 2012/13, the top five partners (Table 5.0, http://www.erd.gov.bd) are IDA (25.00%), ADB (17.48%), Japan (14.26%), UN (7.85%, all in grants) and USA (6.80%). Considering UK, Canada, EU and other European partners, and the fact that the international development institutions are mainly funded by the western countries and Japan, development partnership of Bangladesh with the west and Japan is overwhelming and absolutely critical. Among others, Saudi Arabia ranks 13 (1.7%), IDB ranks 17 (1.1%), India ranks 18 (0.87%) and Russia is dead last (0.75%).

Thus, India as a development partner is rather unimportant while Indian businesses continue to gain strong footings in Bangladesh as illustrated by the latest contract with Oil India and Oil and Natural Gas Corporation for oil and gas exploration in the Bay of Bengal (http://articles.economictimes.indiatimes.com/2014-02-17/news/47412268_1_petrobangla-exploration-gas-field), and Rajuk’s award of the mega project of Nuton Dhaka to Sahara (http://www.sunday-guardian.com/business/sc-order-leads-sahara-to-defer-dhaka-plans). Further, Bangladesh is the fifth largest source (about $4 billion annually, 5%) of wage remittance by Indian expats worldwide (http://www.asiantribune.com/node/71992, http://www.siliconindia.com/news/business/15-Nations-Sending-Highest-Remittances-to-India-nid-147515-cid-3.html). Clearly, Indian businesses and expats should be welcome on a competitive basis, but an equivalent degree of reciprocity is also called for. The same argument also applies to nuclear power plant and arms deals with Russia.

Overall, Indian and Russian friendship is nowhere as important economically as friendship with China, Japan and other Asian countries, the Middle East, and Europe and USA are. It is thus imperative that Bangladesh stands much more sensitive in fostering friendship with these vital partners. If Bangladesh had to tolerate some foreign interference in a globalised world, it better be from key economic partners.

Second, Bangladesh’s strategic location is an invaluable source of land and maritime, internal (North-East of India) and external (China, South-East Asia and rest of the world), connectivity for India. Militarily also, Bangladesh is not too far from China and is bordered by China’s close ally Myanmar. Despite this strategic upper hand for Bangladesh, it is instead India that continues to extract valuable concessions for connectivity and strategic access from Bangladesh while offering little concrete in return. Meantime, the Indian border guards are using lethal force to fend off poor Bangladeshi trespassers but are unable to control the ever booming smuggling of Indian goods into Bangladesh. Thus, unconditional friendship with India has so far strategically benefited India in a lop-sided manner.

Third, Bangladesh continues to be an unofficial battle front for the Indo-Pak war, allegedly fought via espionage, recruitment, financing and arming of sympathisers, and influencing policies, politics and even national elections. Since 9/11, Pakistan has been in the eye of the West’s war on terrorism and religious (Muslim) fundamentalism. Interestingly, despite the world’s largest openly communal base of (Hindu) religious fundamentalists who also came to power once, India has been exceedingly successful in internationally downplaying this while courting partnership with the west’s war. Not to be outmuscled, Pakistan found it tactically beneficial to provide support to the (Muslim) religious fundamentalists in Bangladesh and through their means to the separatists of North-East India and (Muslim) fundamentalists of India.

– See more at: http://opinion.bdnews24.com/2014/03/06/external-relations-of-bangladesh/#sthash.BRmzXFaY.dpuf

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