Bangladesh is deepening its engagement with China while simultaneously rebuilding bridges with India, pursuing a delicate balancing act that carries significant implications for regional power dynamics in South Asia. The strategy places Dhaka at the intersection of two competing geopolitical ambitions, forcing its policymakers to navigate an increasingly complex diplomatic landscape where every handshake carries weight in multiple capitals.
China's Expanding Foothold in Dhaka
Beijing has invested heavily in Bangladesh over the past decade, pouring capital into infrastructure projects that have transformed the skyline of Dhaka and other major cities. Chinese state-owned enterprises have financed highways, bridges, and port facilities, making China one of Bangladesh's largest trading partners with bilateral trade volumes exceeding $20 billion annually in recent years. This economic penetration has given Beijing considerable leverage in Dhaka, a relationship that Indian policymakers watch with growing unease.
The China-Bangladesh relationship extends beyond commerce into defence cooperation. Dhaka has purchased military hardware from Beijing, diversifying its traditional supplier base and signalling a willingness to deepen strategic ties with the People's Liberation Army. This shift has not gone unnoticed in New Delhi, where officials recognise that Chinese influence so close to India's eastern border creates new strategic complications.
India's Strategic Response
New Delhi has ramped up its own engagement with Bangladesh as officials acknowledge that Dhaka's importance to Indian security interests cannot be overstated. Bangladesh shares a porous 4,000-kilometre border with India, the longest land frontier its neighbour controls. For India's northeastern states, Bangladesh's Chattogram port offers a vital maritime outlet that bypasses the narrow Siliguri corridor, a geographical vulnerability India cannot ignore.
India's outreach has taken multiple forms. New Delhi has offered lines of credit for infrastructure projects, expanded people-to-people exchanges, and worked to resolve long-standing disputes over border enclaves and water-sharing arrangements. Prime Minister Narendra Modi visited Dhaka in 2021, a diplomatic gesture that underscored India's commitment to repairing ties that had frayed during the previous decade. Officials in New Delhi now speak of a "neighbourhood first" approach that treats Bangladesh as a cornerstone of regional stability.
The Dhaka Perspective
Bangladeshi policymakers insist they are not choosing sides. Foreign Minister Hasan Mahmud has repeatedly stated that Bangladesh's foreign policy rests on economic pragmatism rather than ideological alignment. Dhaka needs Chinese investment to fuel its rapidly growing economy, which has averaged more than 6 percent annual growth in recent years. Chinese loans finance roads, railways, and power plants that Bangladesh cannot afford to build on its own.
At the same time, Bangladesh shares deep cultural, linguistic, and historical ties with India that cannot be reduced to transactional diplomacy. The 1971 liberation war, when Indian military intervention helped Bangladesh achieve independence from Pakistan, created bonds that continue to shape the relationship. Bangladesh's security forces cooperate with New Delhi on counter-terrorism and anti-insurgency operations, sharing intelligence that benefits both nations.
Economic Dependencies and Trade Balances
The economic dimensions of Dhaka's balancing act are substantial. Bangladesh imports far more from China than it exports, creating a persistent trade deficit that has widened to over $15 billion in recent years. This imbalance concerns Bangladeshi economists who warn that excessive reliance on Chinese manufacturing could stunt the development of domestic industries. Chinese companies dominate key sectors of Bangladesh's economy, from telecommunications to garment manufacturing, giving Beijing indirect influence over thousands of jobs and livelihoods.
India has attempted to address this imbalance by offering preferential trade arrangements and duty-free access for Bangladeshi goods. New Delhi's Northeast Frontier Railway has begun studies on improved cross-border connectivity, which could open new markets for Dhaka's exporters. The Teesta River water-sharing agreement, though still unresolved after decades of negotiation, remains a test of whether India can deliver on commitments that matter to ordinary Bangladeshis who depend on agriculture for their livelihoods.
Security Concerns and Shared Threats
Counter-terrorism cooperation provides a concrete area where Bangladesh's relationships with both Beijing and New Delhi intersect. Bangladesh has cracked down on extremist groups operating within its borders, sharing intelligence with Indian security agencies and cracking down on training camps used by insurgent groups that target Assam and other northeastern states. This cooperation has earned Dhaka goodwill in New Delhi and demonstrated that Bangladesh can be a responsible security partner.
China's role in South Asian security is more ambiguous. Beijing maintains close ties with Pakistan, which has historically supported insurgent groups in India's east. Chinese naval deployments in the Indian Ocean and Bay of Bengal have raised concerns among Indian strategists who see a deliberate effort to encircle India through a "string of pearls" strategy. Bangladesh's location makes it a potential addition to this chain, a prospect that Indian defence analysts find deeply troubling.
Public Sentiment and Domestic Politics
Bangladeshi public opinion complicates the government's balancing act. Surveys indicate that many Bangladeshis view Chinese infrastructure investment positively, appreciating the roads and bridges built with Beijing's financing. However, concerns about "debt trap diplomacy" have gained traction, particularly after Sri Lanka's struggles with Chinese-built port projects. Bangladesh's own experience with the Padma Bridge, financed largely by its own resources after a World Bank corruption scandal derailed external funding, has reinforced a preference for maintaining strategic autonomy.
India enjoys significant cultural soft power in Bangladesh, from the popularity of Bollywood films to shared linguistic heritage. However, episodes of border violence and perceived Indian high-handedness in diplomatic negotiations have created resentment that populists can exploit. The Awami League government of Prime Minister Sheikh Hasina has maintained generally warm relations with New Delhi, but future administrations may adopt different approaches.
What Comes Next
Bangladesh is preparing for general elections that could reshape its political landscape, though the timing and conduct of those polls remain uncertain amid ongoing tensions between the ruling party and opposition groups. Whatever government emerges from the electoral process will inherit the same fundamental challenge: managing relationships with two nuclear-armed neighbours whose rivalry shapes the entire region.
Both Beijing and New Delhi are expected to intensify their courtship of Dhaka in the coming months. Chinese officials have signalled interest in expanded cooperation under the Belt and Road Initiative, while India's external affairs ministry has announced plans for a new round of high-level consultations. How Dhaka responds will test whether a small South Asian nation can carve out strategic space between giants, or whether it will eventually be forced to choose sides.
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This imbalance concerns Bangladeshi economists who warn that excessive reliance on Chinese manufacturing could stunt the development of domestic industries. Chinese companies dominate key sectors of Bangladesh's economy, from telecommunications to garment manufacturing, giving Beijing indirect influence over thousands of jobs and livelihoods.
