The Chinese government has responded positively to several requests made by Bangladesh during the visit of the interim government’s adviser on foreign affairs, Touhid Hossain, to China from January 20 to 24.
Bangladesh requested China to lower the interest rate on both Preferential Buyer’s Credit (PBC) and Government Concessional Loans (GCL) from 2-3 percent to 1 percent, waive the commitment fee, and extend the loan repayment period from 20 to 30 years. It also requested Beijing to improve access of Bangladeshi patients to medical treatment.
On returning to Dhaka after the visit, Hossain told the media that China “agreed in principle” to extend the loan repayment period and promised to look into the request to lower the interest rate. It also agreed to construct a 1,000-bed hospital in Dhaka and designate three to four hospitals in Kunming for medical treatment of Bangladeshi patients.
During Hossain’s visit, Bangladesh and China signed a Memorandum of Understanding on sharing hydrological data on the Yarlung Tsangpo-Brahmaputra-Jamuna river. A mega dam that China plans to build on this river is of concern to Bangladesh.
The two sides also reaffirmed commitment to their comprehensive strategic cooperative partnership and cooperation under the Belt and Road Initiative.
It was just a little over seven months before Hossain’s trip to China that Bangladesh’s former Prime Minister Sheikh Hasina visited Beijing, where she was accorded a grand welcome. During that visit, which came weeks before she was ousted from power by a student-led mass uprising, China and Bangladesh elevated their “strategic partnership” to a “comprehensive strategic cooperative partnership” and signed 21 agreements.
During Hossain’s visit, the Chinese signaled that they are moving on, and are set to work with the Muhammad Yunus-led interim government.
With its “positive response” to Bangladesh’s request relating to loans, “even if only in the form of verbal assurances at this point, China has indicated that Beijing is backing the interim government,” a former Bangladeshi diplomat said. This is in contrast to India, which is “yet to show support for the Yunus government,” he told The Diplomat.
China’s show of support to the Yunus government comes at a time when Delhi-Dhaka relations are strained. India continues to shelter Hasina and has not responded to the Yunus government’s repeated calls for her extradition to Bangladesh to face trial for alleged war crimes. The Indian government has accused Dhaka of not doing enough to protect Hindus in Bangladesh. Bangladesh has objected to India’s fencing of the border, and anti-India sentiment is running high in Bangladesh.
Against this backdrop, China’s positive gestures, like its “yes” to setting up hospitals in Dhaka and Kunming for Bangladeshis, are striking a chord with Bangladeshis.
For decades, Bangladeshis traveled to India to receive medical treatment there. However, with bilateral tensions surging since August 2024, such travel has become difficult, if not impossible. In retaliation to anti-Hindu violence in Bangladesh, some Indian hospitals refused treatment for Bangladeshi patients. India also significantly scaled down the number of visas for Bangladeshis seeking to travel to India. This has led to a further fall in public goodwill for India among Bangladeshis.
“By agreeing to improve Bangladeshi access to medical treatment, China has swiftly stepped in to fill the space left open by India,” the Bangladeshi diplomat said.
Sino-Bangladesh cooperation is not new. Although Beijing was slow to establish diplomatic relations with independent Bangladesh, ties deepened rapidly.
Defense cooperation provides the bedrock of the bilateral relationship; China is the only country with which Bangladesh has a defense cooperation agreement and Chinese weapons make up 82 percent of the total inventory of the Bangladesh Armed Forces. Economic cooperation has surged over the decades too. In 2006, China replaced India as Bangladesh’s leading trade partner. It has also played a major role in funding and building connectivity infrastructure.
Like India, China too, had close ties with the Hasina government. Indeed, of the two it was China that extended Hasina more financial support. Yet, six months after her exit, it is India, not China, that faces public opprobrium in Bangladesh. Beijing wields more influence in Dhaka today than does India.
China’s nimble diplomacy has seen it making tactical shifts in pursuit of its interests. Although Hasina’s fall from power was a setback for Beijing, it moved swiftly to reach out to the new dispensation. It welcomed the interim government a day after its swearing-in and stressed that it “strictly follows the principle of non-interference in other countries’ internal affairs.” Chinese Foreign Minister Wang Yi met Yunus on the sidelines of the United Nations General Assembly meeting in New York in September last year.
Simultaneously, Beijing is engaging with other Bangladeshi political actors. Its ambassador in Dhaka visited the central office of the Jamaat-e-Islami, Bangladesh’s largest Islamist party. The Chinese Communist Party then hosted visits of a delegation of Bangladesh Nationalist Party (BNP) leaders followed by a delegation of Islamic parties, including the JI. This is not a new approach. For decades, Beijing’s policy in Bangladesh has been to engage with not only all governments — democratic and military, elected or not — but also all political parties. China was in touch with the BNP even during Hasina’s rule; President Xi Jinping, for example, met BNP chief Khaleda Zia during his visit to Dhaka in 2016.
Contrast this with India’s AL-centric policy toward Bangladesh. By putting all its eggs in the AL basket, Delhi has left itself with no friends in Dhaka after Hasina’s fall. While it is said to have opened talks with the BNP, it is reportedly unlikely to engage with the JI. “Who it [India] considers a friend and foe in Bangladesh is set in stone,” the Bangladeshi diplomat said.
India’s Prime Minister Narendra Modi could have met Yunus in New York but did not. Importantly, the Modi government has allowed domestic political and electoral considerations to cloud its dealing with Dhaka. Politicians of Modi’s Bharatiya Janata Party and fraternal organizations actively stoked anger in India during the communal tensions in Bangladesh. The Modi government did nothing to rein them in. It sullied India’s image further in Bangladesh.
It is not just the space opened up by India’s diplomatic failures that China will be looking to fill in Bangladesh. U.S. President Donald Trump’s suspension of aid to all foreign countries will impact Bangladesh’s health, education and sustainable development sectors. In 2023, the United States directed $401 million to Bangladesh via USAID. The funding freeze could deepen economic and other challenges that the interim government is already grappling with.
Bangladesh’s appreciation of China’s helping hand will therefore deepen.