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From Tariff Waiver To Billion Dollar Loan, How China Is Winning Bangladesh Over

Reports that Dhaka is seeking funding from Beijing for a Teesta river project have raised concerns in India.
Prime Minister Narendra Modi and Bangladesh's Prime Minister Sheikh Hasina prior to a meeting in New Delhi on October 5, 2019.
PRAKASH SINGH via Getty Images
Prime Minister Narendra Modi and Bangladesh's Prime Minister Sheikh Hasina prior to a meeting in New Delhi on October 5, 2019.

While India’s standoff with China in Ladakh continues, with the Indian Army reporting recent violations by PLA troops, reports last week said that Dhaka has turned to Beijing for funding infrastructure projects. Bangladesh is discussing a nearly $1 billion loan from China for a management and restoration project on the Teesta river, according to The Indian Express.

Sharing of the Teesta river water is a contentious issue between India and Bangladesh and the two countries have been holding talks to come to an agreement since 1983. Teesta flows through the Indian states of Sikkim and West Bengal before reaching Bangladesh and joining the Brahmaputra.

Hence the reports that Bangladesh is seeking funding from China for a project on Teesta has raised concerns in India (see here, here and here).

A water-sharing agreement was almost signed between India and Bangladesh during the visit of former Prime Minister Manmohan Singh to Dhaka in 2011. The proposed deal was, however, called off after opposition from West Bengal Chief Minister Mamata Banerjee, according to ANI.

The issue was discussed again in 2015 during Prime Minister Narendra Modi’s visit to Bangladesh and he assured Sheikh Hasina that the two countries could reach a “fair solution” on Teesta. Even in 2017, Modi had assured Dhaka of an “early solution” to the Teesta water sharing issue.

Veena Sikri, former Indian High Commissioner to Bangladesh, told HuffPost India that China’s cooperation with and investment in Bangladesh is long-standing. “But as far as Teesta is concerned, it is a bilateral issue between India and Bangladesh where I think third parties have no place,” she said.

She pointed out that the Ganga Waters Treaty — signed in 1996 — has worked very well and been satisfactory for both sides. “With Teesta also, we hope to come to an agreement very soon.”

India and Bangladesh share 54 common rivers and have an agreement on the sharing of Ganga waters (The Ganga Waters Treaty, signed in 1996).

Even on Teesta, the two countries had reached an agreement in 1983, according to The Third Pole, to share water during the lean pre-monsoon days. Under the two-year agreement, Bangladesh would get 36% of the water during the lean season, India would get 39%, and 25% would remain unallocated. The agreement was only extended for another two years till the end of 1987, it added.

The China question

Concerns have been raised over China’s growing involvement in Bangladesh. A government official told The Print last month that “from Nepal to Bangladesh, China is targeting all of India’s friendly neighbours one by one.”

Nepal was part of the quadrilateral meeting hosted by China last month where the countries — China, Nepal, Afghanistan and Pakistan — discussed coordination on Covid-19 response and boosting economic recovery. Abanti Bhattacharya, Associate Professor at Department of East Asian Studies, Delhi University, had told HuffPost India that this meeting could be seen as a plan “to encircle India with a hostile ring of nations”.

Subhajit Naskar, Assistant Professor at Department of International Relations, Jadavpur University also told HuffPost India that the growing closeness between Bangladesh and China will contribute to regional rivalry.

“The Chinese policy of encircling India through its robust economic diplomacy will be a strategic nightmare,” he added.

Bangladesh’s relations with India

The Ministry of External Affairs last month said that India and Bangladesh are “exceptionally close” and Union Minister S Jaishankar said that India’s partnership with Bangladesh stands out as a role model in the region for good neighbourly relations.

Sikri also said that the relations between the two countries are strong and cooperation has only strengthened in recent years. Foreign Secretary Harsh Vardhan Shringla’s two-day visit to Bangladesh last month (18-19 August) is also an indication of it, she added.

Shringla’s visit came amid reports of China’s likely assistance to Bangladesh for the Teesta project. He held talks with Hasina and his counterpart on bolstering bilateral ties as well as on the supply of Covid-19 vaccine to Dhaka once it is developed. The two foreign secretaries also discussed the latest situation of the Rohingya refugees. India reiterated its position on safe, secure and sustainable Rohingya repatriation, according to PTI.

The High Commission of India in Bangladesh said that Shringla’s visit was part of ongoing bilateral engagement between two close and friendly neighbours.

The Hindu quoted officials privy to the meeting as saying that more difficult issues such as the protests in Bangladesh over the Citizenship Amendment Act (CAA), or China’s recent inroads were not discussed during the meeting with Hasina. Neither was Teesta.

While generally friendly, India and Bangladesh relations have come under some strain in recent times. “Strains in the India-Bangladesh bilateral relations started late last year with the passage of Citizenship Amendment Bill,” Naskar said.

Hasina said in January that while the CAA is an internal matter of India, the act was “not necessary”. Protests were held in Dhaka against the Citizenship Amendment Act ahead of Modi’s proposed visit to Bangladesh in March to join the celebrations marking the country’s founder Sheikh Mujibur Rahman’s birth centenary. The celebrations were postponed in view of the Covid-19 pandemic.

Naskar said that despite having historical ties, Bangladesh government’s displeasure over the passage of CAA was not concealed and eventually forced Bangladesh to look for alternative allies.

Sikri, however, disagreed, saying that Shringla clearly said after his visit to the country in March that CAA does not affect the internal situation in Bangladesh at all.

The continued custody of Tablighi Jamaat members is turning into another friction point. The Hindu quoted Bangladesh Foreign Secretary Masud Bin Momen as saying that he had raised the issue of about 173 Bangladeshis still being held in India during his meeting with Shringla in Dhaka and asked him to expedite their return.

MEA spokesperson Anurag Srivastava said Momen acknowledged that most of the Tablighis from Bangladesh have returned home.“We will continue to work with the relevant authorities to ensure that others who remain return as well,” he said

“They have been fined and have been asked to leave the country. As per the information that I have, there are 1,030 Tablighi foreigners who have been discharged as on date and their respective foreign embassies have been informed. Of these 1,030, 550 have already left the country,” he said.

Looking towards China?

Journalist Sudha Ramachandran wrote in The Diplomat that successive Indian governments have failed to deliver on their promise to settle the Teesta dispute, making it hard for the Awami League government to justify its cooperation with Delhi on issues of importance to India.

China has also announced a tariff exemption for 97% of Bangladeshi products effective from 1 July. This announcement was widely welcomed in Bangladesh, according to The Indian Express. China’s trade with Bangladesh is now about twice that of India, according to Livemint, and it is the biggest arms supplier to the country.

Business Standard pointed out the consequences of China’s involvement in the Teesta Basin in Bangladesh. “For India, any Teesta settlement as a bilateral issue would be shadowed by a third party which can influence Bangladesh’s approach to the negotiations,” it said, adding that China would also gain access to hydrological data not normally available to it.

This article exists as part of the online archive for HuffPost India, which closed in 2020. Some features are no longer enabled. If you have questions or concerns about this article, please contact