During the first day of an historic visit by Chinese President Xi Jinping, the leaders of China and Bangladesh pledged Friday to build a strategic partnership after signing off on 27 agreements aimed at fostering trade and investment along with countering terrorism.
Diplomatic observers see Xi’s two-day visit to Bangladesh, the first by any Chinese leader in 30 years, as a milestone in expanding Sino-Bangladeshi relations. Observers also see the visit as part of Bangladesh’s strategy to reduce its dependence on neighboring India.
Xi met Friday with President Abdul Hamid and the Prime Minister Sheikh Hasina in Dhaka and agreed to aid and loan packages that total billions of dollars.
“Bangladesh and China have had close cooperation which has now been lifted into a strategic relationship. Through these agreements, the relations of the two countries would be further deepened, while new relations between the two countries will be revealed,” Bangladeshi Foreign Secretary Md Shahidul Haque told reporters after the bilateral talks at the prime minister’s office.
One of the agreements focuses on combating militants.
Specifically agreement 17 states: “The two sides condemned terrorism in all its forms and manifestations. The Chinese side conveyed its support for Bangladesh’s efforts in combating terrorism and maintaining national security and stability and expressed its readiness to cooperate through sharing of information, capacity building and training with Bangladeshi side.”
It went on to say the two sides agreed to explore establishing a dialogue mechanism on countering terrorism.
Other agreements focused on loans, investment and trade. Xi signed those agreements valued at about U.S. $20 billion (1.5 trillion taka), Agence France-Presse reported.
Hasina told reporters this means that Bangladesh and China had reached a “consensus” to work together in the fields of trade and investment, infrastructure, transportation, information and communication technology, power, energy and agriculture.
She said Bangladesh’s “strategic partnership” with China would be for “socioeconomic achievements” for the people of the two countries.
Xi echoed her words.
“We agreed to elevate China-Bangladesh relationship from a ‘Closer Comprehensive Partnership of Cooperation’ to a ‘Strategic Partnership of Cooperation’ and to increase high-level exchanges and strategic communication so that our bilateral relations would continue to move ahead at a higher level,” Xi said in the statement, according to a news agency report.
Foreign Secretary Haque said China indicated it would invest in the ready-made garment (RMG) and jute sectors. RMG accounted for U.S. $28 billion (2.2 trillion taka) of a total export volume of $34 billion (2.66 trillion taka) in the last fiscal year, which ran from July 1, 2015 to June 30, 2016, according to the data from Bangladesh’s Exports Promotion Bureau.
Deals benefit both countries
Economist Hossain Zillur Rahman told BenarNews that all financial aid and assistance are aimed at “exerting influence” on the receiving countries.
“We took a loan of $2 billion (156 billion taka) from India for development projects. But the Chinese volume of aid and loan is much bigger. It may reach $40 billion (3.1 trillion taka). So, the Chinese aid and the loans would certainly exert some influence in Bangladesh,” Zillur said.
Taking loans from China means the government is seeking to reduce its over-reliance on India both at the political and economic fronts, he said. Bangladesh needs the loans and aid to improve its infrastructure to attract foreign investment.
“But we have to be very careful in selecting the projects for which the Chinese loans are granted. For instance, funding a controversial project will raise questions about the purpose of the whole initiative,” he said.
Also, he said, China wants a special economic zone to relocate its RMG, leather and other small industries.
“The relocation of Chinese factories to Bangladesh and exporting these products to China would help the Chinese people and reduce Bangladesh's huge trade gap with China,” Zillur said.
Ambassador Ashfaqur Rahman, a former Bangladesh envoy to China and North Korea, told BenarNews that China was providing the loan and aid package as part of its plan to implement its initiative to reach European markets.
“China needs Bangladesh to implement its initiative. Besides, relocation of Chinese industrial units to Bangladesh will create jobs for locals,” said Rahman, adding that Bangladesh had huge opportunity to export its medicines to the Chinese market.
“You see the main opposition Bangladesh Nationalist Party opposed the Indian loans but they have welcomed the Chinese loans and aids. And this is very significant in the Bangladesh-China relations in the future,” he said.