[🇧🇩] China is a Time Tested Friend and a Strategic Partner of Bangladesh

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[🇧🇩] China is a Time Tested Friend and a Strategic Partner of Bangladesh
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G Bangladesh Defense Forum

Crucial China-Bangladesh Beijing talks
Brahmaputra, Teesta under spotlight

No negative impact on downstream countries: China
MIR MOSTAFIZUR RAHAMAN
Published :
Jan 20, 2025 00:33
Updated :
Jan 20, 2025 00:33

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Bangladesh will raise the issue of Chinese dam on the Brahmaputra at the upcoming bilateral meeting in Beijing on January 21, when the stalled Teesta project may also come up.

Sources in the foreign ministry told The Financial Express about the move as Bangladesh foreign adviser Touhid Hossain leaves for Beijing today (Monday) for meeting his counterpart, the foreign minister of China.

"Water-resources cooperation will highly be featured in the meeting," officials said, adding that Bangladesh "will try to understand whether the dam on the international river Brahmaputra to be constructed by the Chinese side will affect Bangladesh."

About the stalled Teesta project -- economic lifeline of agrarian northern Bangladesh -- officials said Teesta is not officially included in the meeting agenda but may come up as water cooperation will be a prime focus in talks.

They mentioned that though China completed primary feasibility study on the Teesta project on request of Bangladesh government during the Hasina regime two years ago, Bangladesh refrained from advancing the project.

Rather, during the visit of ousted prime minister Sheikh Hasina last year, Bangladesh involved India with the project, which, practically, complicated the scheme.

Following that development, the Chinese Ambassador in Dhaka told the FE that if Bangladesh wanted, China was interested to implement the project in partnership with other countries.

Talking about China's involvement with the multipurpose Teesta project, foreign adviser Towhid Hossain told the media that Bangladesh would renew the MoU on water-resources cooperation with China during his visit and Teesta issue would "naturally come up in connection with water-resources cooperation".

According to officials, Bangladesh will raise the issue of the Chinese dam upstream the Brahmaputra River during the meeting.

China announced its decision to build the dam four years ago, and recently, it approved the construction of the world's largest dam, rated as planet's biggest, on the Brahmaputra in Tibet near the Indian border.

In December last year, the Chinese government sanctioned the development of a hydropower facility on the lower section of the Yarlung Zangbo River, which is the Tibetan name for the Brahmaputra.

The US$137-billion, mega-infrastructure project has raised concerns in downstream countries, including India and Bangladesh, over potential impacts on water flow.

According to the South China Morning Post, the cost of this dam project will exceed any infrastructure project globally, including China's Three Gorges Dam, currently considered world's largest.

Bangladesh is heavily dependent on external sources for water. The 1,800-km-long Brahmaputra, which enters Bangladesh from India after originating from Tibet region under China, is the largest source of external water for Bangladesh.

If both the countries withdraw water in the upstream from the Brahmaputra, Bangladesh will be rendered a barren land, environmentalists forewarn.

The total water resource of Bangladesh is estimated at 1,210,644 million cubic metres, of which 1,105,644 cubic metres come from sources beyond the borders.

"We may see heavy water flow when we do not need water, and there might be no water in the dry season when we require it most," a senior official of the Ministry of Water Resources told the FE recently.

According to statistics, at least 60 per cent of Bangladesh's population relies on the Brahmaputra-catchment basin.

A catchment or basin is an ecological system of drainage that sees rainfall or river waters drained into the surrounding environment, and can be accessed through lakes, wells or small tributary rivers.

Officials say constructing dams in the upstream means that the countries concerned will have the leverage to withdraw or release water as per their requirement.

China first disclosed its plan to construct a dam on the Brahmaputra when Yan Zhiyong, chairman of the Power Construction Corp of China or POWERCHINA, said China would implement its hydropower-exploration plan in the downstream of the international river.

The new dam is planned to produce at least 60 gigawatts (GW) of electricity. To put that into perspective, one GW is the quantity of energy captured by 3.125 million solar panels or 412 wind turbines. One GW is also enough to power 110 million LED lights, says an analyst.

In March 2019, China's parliament adopted the 14th five-year plan, which included the hydropower project on the Brahmaputra in Tibet near India's Arunachal Pradesh.

India announced a plan to construction a hydroelectric dam with 10-GW capacity in Arunachal to mitigate adverse impact of the Chinese dam.

The planned dam would create a large water-storage capacity in India to offset effect of the Chinese dam on water flow, an official of the Indian water resources ministry said.

However, talking to the FE on the Chinese dam project, Dr Ainun Nishat, a leading environment expert, suggested trilateral cooperation to reap benefit from the Chinese dam project.

"If China is going to produce electricity through constructing a dam on the Brahmaputra in the upstream, Bangladesh can negotiate to have a share in the project," he said.

"We can invest partly, and have a share of the power generated from the project. India can also join us, so that the negative effect of the project can also be minimised through consultations."

About campaigns against construction of the proposed dams, he said dams are essential for many reasons, including flood management.

"I am not against construction of dams, but the dams should be constructed in a manner so that these will not cause serious harm to ecology and locality."

The expert adds: "Previously dams were built according to the design of engineers, but now we suggest stakeholder consultation before designing a dam."

On the other hand, Chinese officials have said they would address the concern of both India and Bangladesh over this issue.

"The project will not have a negative impact on the ecological environment, geological conditions and the rights and interests related to water resources of downstream countries," Chinese foreign ministry spokesperson Guo Jiakun said earlier this week to allay India's concerns.

Earlier, soon after the disclosure of the dam-building plan, Chinese foreign ministry spokesperson Hua Chunying was asked about it in a media briefing in Beijing.

She said, "Hydropower development in the lower reaches of the Yarlung Zangbo River is China's legitimate right. When it comes to use and development of cross-border rivers, China always acts responsibly."

China has a policy featuring development and conservation, and all projects will go through science-based planning and assessment, giving full consideration to impact downstream and accommodating interests of both the upstream and downstream regions.

The development of the lower reaches of the Yarlung Zangbo is in the early stages of planning and assessment, she noted.

"There is no need to read too much into that."

Regarding the concerns in India and Bangladesh, she said, "For a long time, China, India and Bangladesh have had good cooperation in sharing hydrological information, flood and disaster reduction and contingency management. We will continue our communication through existing channels.

"There is no need for any anxiety in this matter."

According to international law, the countries that are upstream of a river have the sovereignty to build dams on their stretch of water, even though it may impact the countries further downstream.

However, the right is balanced by the principles of 'reasonable use' and 'no harm'.

But China is not a party to the UN Convention on the Protection and Use of Transboundary Watercourses and International Lakes.

Meanwhile, Chinese Ambassador Yao Wen met Adviser for Foreign Affairs of the interim government Md. Touhid Hossain on Sunday morning at the Ministry of Foreign Affairs exchanging views on what to come out of the Dhaka-Beijing talks.

The envoy informed the Foreign Adviser that during his upcoming visit, the Chinese side is ready to sign implementation plan on exchange of hydrological information with Bangladesh which was previously sent by Bangladesh side.

He also apprised the adviser that China is seriously considering lowering its interest rates in lending to Bangladesh.

"China is the all-weather, time-tested friend of Bangladesh which firmly stands with the people of Bangladesh irrespective of its government," the Ambassador said.

He said standing beside Bangladesh with the spirit of good friend and neighbour, China will continue its support for the early repatriation of the forcibly displaced Myanmar nationals (FDMN) to their motherland in Myanmar.​
 

China keen to take Chief Adviser to Beijing in March
Raheed Ejaz
Dhaka
Published: 20 Jan 2025, 23: 14

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Following the 5 August 2024 changeover due to the student-people uprising, China is keen to deepen the relations with Bangladesh. Beijing is interested in a summit meeting in continuation of bilateral meetings with the interim government. That is why China wants to take Chief Adviser Dr Muhammad Yunus to China in March this year, marking five decades of diplomatic relations between the two countries.

China has already invited Dr Muhammad Yunus to attend the Boao Forum For Asia (BFA), scheduled to be held in Beijing on 27-28 March, diplomatic sources said.

The Boao Forum for Asia is a nonprofit platform that hosts high-level forums for leaders from government, business and academia in Asia and other continents to share their vision on the most pressing issues in this region and the world at large.

Wishing not to be named, a high level source in the government Sunday evening told this correspondent that China has shown interest for a bilateral summit meeting with the Chief Adviser alongside attending the BFA conference during the visit to Beijing

Foreign ministry officials said foreign adviser Md Touhid Hossain would leave for China in a bilateral meeting on Monday afternoon. He will hold a bilateral meeting with China Foreign Minister Wang Yi in Beijing on Tuesday.

The two will discuss how the relations would move forward. The health sector could get importance in cooperation between the two countries in the coming days. Discussions may be held on setting up a friendship hospital in Bangladesh with the help of China for the first time, ensuring low-cost medical services for Bangladeshi patients in several provinces, including Kunming, as well as on signing several memorandums of understanding (MoUs) on special projects for the care and rehabilitation of injured people in Dhaka.

China wants to send chartered aircraft

The chief adviser has recently been invited to attend the 25-nation BFA summit in Beijing from 25-28 March. China is interested in organising a discussion between the country’s top leaders, including President Xi Jinping, and Bangladesh’s top leader on the sidelines of the forum meeting.

However, wishing not to be named, several foreign ministry officials think that there is uncertainty about the visit in March. State events are organised on 26 March due to Bangladesh’s Independence and National Day. Apart from this, it is also a matter of consideration, whether it is enough to organise a summit meeting just two months after the foreign adviser’s meeting.

At the same time, diplomats believe that it is imperative to move cautiously instead of getting close to any country hurriedly due to the tilted policies of the previous government.

A diplomatic source told this correspondent that the matter of sending a chartered plane from China to take Chief Adviser Muhammad Yunus to Beijing was also mentioned.

The source said the issue of the Chief Adviser’s visit to China may come up for discussion during the foreign affairs adviser’s visit to Beijing.

Bangladesh-China friendship hospital in discussion

Sources said that the issue of giving importance to the health sector in cooperation is expected to be discussed at the foreign minister-level meeting in Beijing Tuesday. Dhaka has proposed to Beijing to sign an MoU to set up a specialised medical and rehabilitation centre with financial and technical assistance from China, especially for the treatment and rehabilitation of those injured in the student uprising.

Sources further said that Bangladesh is interested in signing an MoU quickly to construct the first friendship hospital, funded by China, in Purbachal. Bangladesh wants the hospital to be run by skilled physicians and professionals from China.

Apart from this, Bangladesh wants China’s cooperation in identifying high-quality hospitals in Kunming and adjacent areas to ensure medical services for Bangladeshi patients.

China’s Ambassador to Bangladesh Yao Wen told Prothom Alo Sunday morning, “We agree in principle to establish a hospital in Bangladesh. We are now waiting for a detailed proposal from Bangladesh. We want to know what kind of hospital Bangladesh wants and where this hospital will be constructed.”

“We will move forward following a process after receiving a proposal from Bangladesh. We are interested in modernising Bangladesh’s health sector,” he added.

China still interested in Teesta project

The MoU on sustainable management of river water, signed between the two countries in 2016, is scheduled to be renewed during the foreign adviser’s visit. The agreement signed between the Bangladesh Water Development Board (BPDB) and Power China is considered an outline MoU. Discussions are underway between the two countries on the Teesta project in continuation of this MoU.

Speaking about the Teesta project, Yao Wen said, “We are interested in assisting Bangladesh in this project. Now it is Bangladesh that will have to decide how to implement it.”

Diplomatic sources said the Bangladesh side at the meeting in Beijing will raise the construction of China’s mega dam in upstream of the Brahmaputra River. The country has taken the initiative to construct a dam worth about USD 100 billion in Tibet to generate about 60,000 MW electricity. This has created doubts about the availability of water for downstream countries. India has already expressed concerns over the construction of the dam.

The Chinese ambassador met with adviser Touhid Hossain on Sunday morning. Later, speaking about the construction of the dam in Tibet, the ambassador said that the construction will not have any negative impact on the downstream countries.

Bangladesh focuses on reducing interest rates

In the foreign minister level bilateral meeting, Bangladesh will put stress on investment, trade and project financing. In addition to reducing the interest rate from 2 per cent to a reasonable level, Dhaka will seek the cancellation of the 0.5 per cent loan commitment fee.

The meeting will also discuss important projects, including the procurement of four ships as per the previous agreement, especially the projects for which financing is currently stalled. Dhaka will also seek China’s cooperation on the Rohingya issue.

Bangladesh will also urge China to stand by the Rohingyas in the UN Security Council. At the same time, Bangladesh expects more investment from China.

After 5 August, China has come forward with an investment of over USD 200 million. The country is also one of the major trading partners of Bangladesh. Dhaka will seek cooperation in free trade of goods and raw materials, including delayed payment.

Bangladesh will also seek duty-free and quota-free facilities for Bangladeshi products in the Chinese market for an additional three years after graduating from a low-income country.

Asked about the China visit, foreign adviser Md. Touhid Hossain told Prothom Alo, “There will be discussions on advancing cooperation between the two countries, keeping in mind the five-decade anniversary of the relations. Our priority will be economic and development cooperation.”

* The report, originally published in the print and online editions of Prothom Alo, has been rewritten in English by Shameem Reza​
 

Foreign adviser’s china tour: 10 extra years for repaying Chinese loans
Interest rates might be lowered

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Photo: PID

Beijing has agreed in principle to extend the repayment period for Chinese loans and assured Dhaka it will look into the request to lower the interest rate to ease Bangladesh's foreign debt repayment pressure.

China is Bangladesh's fourth-largest lender after Japan, the World Bank and the Asian Development Bank, with total loans disbursed since 1975 coming to $7.5 billion.

The development came yesterday during Foreign Adviser Touhid Hossain's bilateral meeting with Chinese Foreign Minister Wang Yi on his four-day tour of China at the Diaoyuitai State Guest House in Beijing.

At the meeting, Hossain requested lowering the interest rate on Chinese loans from 2-3 percent to 1 percent, waiving the commitment and management fees and extending the loan repayment period from 20 years to 30 years for both the preferential buyer's credit and government concessional loans.

Praising Bangladesh's good track record in repayment, Wang agreed to extend the maturity period for loans provided to the country and also assured of looking into the request of lowering the interest rate on the loans, according to a statement from the Bangladesh foreign ministry.

China places Bangladesh at a very important position in her neighbourhood diplomacy, the statement said quoting Wang as saying.

Also yesterday, Hossain held a meeting with Luo Zhaohui, the chairman of the China International Development Cooperation Agency, about Chinese loans.

Hossain requested Luo to ramp up concessional loans and grants and the number of projects China funds in Bangladesh. Luo responded positively and sought a list of priority projects from Bangladesh.

Luo said China may consider larger projects in Bangladesh, with some project funds extended as grants. As a result, the average interest rate of Chinese loans will go down, he said.

Both sides also discussed the financing of projects in metro rail and the Southern Infrastructure Development Initiative (SIDI) in Bangladesh.

Over at Hossain's bilateral meeting with the Chinese foreign minister, Beijing assured of continued duty-free and quota-free access to Bangladeshi products for three years after graduation from the least-developed country bracket in 2026.

Wang also conveyed China's decision to designate three to four recognised hospitals in Kunming for treatment of Bangladeshi patients.

He also welcomed Bangladesh's proposal of setting up a specialised tertiary-level Chinese hospital in Dhaka as a gesture of goodwill on the occasion of the 50th anniversary of Bangladesh-China diplomatic relations.

Both sides conveyed their readiness to organise a host of activities to mark the occasion.

Wang requested Bangladesh to consider joining Chinese President Xi Jinping's three global initiatives: the Global Development Initiative, the Global Security Initiative and the Global Civilisation Initiative.

In response, Bangladesh conveyed their intention to examine the proposals and to remain engaged with China in deliberations on the issues.

Wang reaffirmed that China respects the sovereignty and territorial integrity of Bangladesh and reiterated continued Chinese support for the stability, reforms, democratic transition and development initiatives of Bangladesh.

Recognising Bangladesh's strategic position, the two sides emphasised continued cooperation under the Belt and Road Initiative.

China wants to see Bangladesh's economic development in pace with their own development and assured China's continued support for the projects conducive to the livelihood of the people of Bangladesh, Wang said.

The two sides expressed their willingness to work closely on proposed Chinese-funded projects: the Dasherkandi sewage treatment plant, the upgradation and modernisation of Mongla Port and the establishment of digital connectivity and 4G expansion.

The Chinese side was very positive about the request for lowering the interest rate and financial support, an official of the foreign adviser's delegation told the correspondent from Beijing.

"They have not insisted on their issues of GDI and GSI, but said they want us to be with them for inclusive development," he said.

Bangladesh sought detailed information on China's plan to build a mega-hydropower dam across the Yarlung Tsangpo River in Tibet.

The Chinese side said they would not consume or withdraw any water and thus the lower riparian countries will not be affected, the official said, adding that there was no discussion on the Teesta river management project.

Both leaders discussed the Rohingya crisis and reaffirmed their shared commitment to work on a roadmap to finding a durable solution to the issue, according to the foreign ministry statement. Wang reassured China's continued engagement with Myanmar to address the situation and promote regional stability.

Hossain reiterated Bangladesh's firm commitment to the 'One China Principle' and unwavering support for UNGA Resolution 2758.

The two countries signed the implementation plan for the memorandum of understanding on the exchange of hydrological information on the Yaluzangbu-Jamuna rivers.

Hossain also met with Liu Jianchao, the minister of the international department of the Chinese Communist Party, yesterday to discuss Chinese-funded development projects in Bangladesh.

Liu reaffirmed China's continued support for the interim government and peaceful transition to democracy through a free, fair and participatory election.​
 

প্রতিবেশী কূটনীতিতে আমরা সবসময় বাংলাদেশকে অগ্রাধিকার দেই: চীনা পররাষ্ট্রমন্ত্রী
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পররাষ্ট্র উপদেষ্টা তৌহিদ হোসেন আজ বেইজিংয়ে চীনের পররাষ্ট্রমন্ত্রী ওয়াং ইর সঙ্গে বৈঠক করেন। ছবি: সংগৃহীত

চীন তার প্রতিবেশী কূটনীতিতে সর্বদা বাংলাদেশকে অগ্রাধিকার দেয় এবং বাংলাদেশি জনগণের বিষয়ে সুপ্রতিবেশী নীতি মেনে চলে বলে মন্তব্য করেছেন দেশটির পররাষ্ট্রমন্ত্রী ওয়াং ই।

আজ মঙ্গলবার বেইজিংয়ে বাংলাদেশের পররাষ্ট্র উপদেষ্টা তৌহিদ হোসেনের সঙ্গে এক বৈঠকে ওয়াং ই এমন মন্তব্য করেছেন বলে চায়না ডেইলি জানিয়েছে।

বৈঠকে চীনা পররাষ্ট্রমন্ত্রী ওয়াং ই বলেন, 'বাংলাদেশের সঙ্গে দ্বিপাক্ষিক সম্পর্ক আরও এগিয়ে নিতে চীন বাস্তবসম্মত সহযোগিতা গভীর করতে এবং বেল্ট অ্যান্ড রোড সহযোগিতা এগিয়ে নিতে আগ্রহী।'

চার দিনের সফরে গতকাল সোমবার রাতে বেইজিংয়ে পৌঁছান উপদেষ্টা তৌহিদ হোসেন। চীনের পররাষ্ট্রমন্ত্রীর আমন্ত্রণে তিনি দায়িত্ব গ্রহণের পর এই প্রথম বিদেশ সফর করছেন।

ওয়াং ই বলেন, 'দায়িত্ব গ্রহণের পর তৌহিদ হোসেন তার প্রথম বিদেশ সফরের জন্য চীনকে বেছে নেওয়ার বিষয়টি চীন-বাংলাদেশ সম্পর্ককে বাংলাদেশের অন্তর্বর্তী সরকার কতটা গুরুত্ব দেয় তা প্রতিফলিত করে।'

'চীন ব্যাপক সংস্কার করছে এবং চীনের আধুনিকীকরণকে এগিয়ে নিচ্ছে, যা বিশ্বের বিভিন্ন দেশের জন্য, বিশেষ করে প্রতিবেশী দেশগুলোর জন্য নতুন সুযোগ তৈরি করবে,' বলেন তিনি।

বাংলাদেশ দক্ষিণ এশিয়ার প্রথম দেশ হিসেবে চীনের সঙ্গে বেল্ট অ্যান্ড রোড সহযোগিতার বিষয়ে সমঝোতা স্মারক সই করেছিল।

বড় বড় এবং 'ছোট কিন্তু সুন্দর' প্রকল্প বাস্তবায়নের মাধ্যমে মানুষের আয় বাড়ানোর প্রচেষ্টা সমন্বয় করার আহ্বান জানান চীনা পররাষ্ট্রমন্ত্রী। তৌহিদ হোসেনকে তিনি বলেন, 'নতুন নতুন উদীয়মান ক্ষেত্রগুলো খুঁজে বের করুন এবং দুই দেশের ঐতিহাসিক সহযোগিতা একীভূত করুন।'

এ বছর চীন-বাংলাদেশের কূটনৈতিক সম্পর্ক প্রতিষ্ঠার ৫০তম বার্ষিকী পালিত হচ্ছে। একইসঙ্গে চীন-বাংলাদেশ সাংস্কৃতিক বিনিময়ের বছর।

ওয়াং ই এই ঐতিহাসিক বন্ধুত্বকে এগিয়ে নিতে কৌশলগত যোগাযোগ জোরদার এবং কৌশলগত সহযোগিতামূলক অংশীদারত্ব এগিয়ে নিতে চীনের প্রস্তুতি ব্যক্ত করেছেন।

জবাবে উপদেষ্টা তৌহিদ হোসেন বলেন, 'চীনের সঙ্গে বন্ধুত্ব বাংলাদেশের সব দল চায়, যা সরকার ও পুরো জাতি সমর্থন করে।'

তিনি বাংলাদেশের স্বাধীনতা, সার্বভৌমত্ব এবং আঞ্চলিক অখণ্ডতা রক্ষায় চীনের সমর্থনের জন্য ধন্যবাদ জানান এবং এক-চীন নীতির প্রতি বাংলাদেশের দৃঢ় সমর্থনের প্রতিশ্রুতি দেন।

তিনি বলেন, 'বাংলাদেশ চীনের সঙ্গে বিভিন্ন আন্তর্জাতিক ফোরামে জড়িত হতে আগ্রহী। পাশাপাশি আঞ্চলিক বিষয়ে সমন্বয় জোরদার করতে, সংযোগ ও আঞ্চলিক অর্থনৈতিক একীভূতকরণের অংশীদার হিসেবে কাজ করতে এবং যৌথভাবে আন্তর্জাতিক ন্যায্যতা ও ন্যায়বিচার রক্ষা করতে আগ্রহী।'​
 

ড. ইউনূসকে নিতে বিশেষ বিমান পাঠাবে চীন, তীক্ষ্ণ দৃষ্টি মোদীর! (China intends to send a special plane to take Dr. Yunus to China)


 

China keen to take Chief Adviser to Beijing in March
Raheed Ejaz
Dhaka
Published: 20 Jan 2025, 23: 14

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Muhammad Yunus File photo

Following the 5 August 2024 changeover due to the student-people uprising, China is keen to deepen the relations with Bangladesh. Beijing is interested in a summit meeting in continuation of bilateral meetings with the interim government. That is why China wants to take Chief Adviser Dr Muhammad Yunus to China in March this year, marking five decades of diplomatic relations between the two countries.

China has already invited Dr Muhammad Yunus to attend the Boao Forum For Asia (BFA), scheduled to be held in Beijing on 27-28 March, diplomatic sources said.

The Boao Forum for Asia is a nonprofit platform that hosts high-level forums for leaders from government, business and academia in Asia and other continents to share their vision on the most pressing issues in this region and the world at large.

Wishing not to be named, a high level source in the government Sunday evening told this correspondent that China has shown interest for a bilateral summit meeting with the Chief Adviser alongside attending the BFA conference during the visit to Beijing

Foreign ministry officials said foreign adviser Md Touhid Hossain would leave for China in a bilateral meeting on Monday afternoon. He will hold a bilateral meeting with China Foreign Minister Wang Yi in Beijing on Tuesday.

The two will discuss how the relations would move forward. The health sector could get importance in cooperation between the two countries in the coming days. Discussions may be held on setting up a friendship hospital in Bangladesh with the help of China for the first time, ensuring low-cost medical services for Bangladeshi patients in several provinces, including Kunming, as well as on signing several memorandums of understanding (MoUs) on special projects for the care and rehabilitation of injured people in Dhaka.

China wants to send chartered aircraft

The chief adviser has recently been invited to attend the 25-nation BFA summit in Beijing from 25-28 March. China is interested in organising a discussion between the country’s top leaders, including President Xi Jinping, and Bangladesh’s top leader on the sidelines of the forum meeting.

However, wishing not to be named, several foreign ministry officials think that there is uncertainty about the visit in March. State events are organised on 26 March due to Bangladesh’s Independence and National Day. Apart from this, it is also a matter of consideration, whether it is enough to organise a summit meeting just two months after the foreign adviser’s meeting.

At the same time, diplomats believe that it is imperative to move cautiously instead of getting close to any country hurriedly due to the tilted policies of the previous government.

A diplomatic source told this correspondent that the matter of sending a chartered plane from China to take Chief Adviser Muhammad Yunus to Beijing was also mentioned.

The source said the issue of the Chief Adviser’s visit to China may come up for discussion during the foreign affairs adviser’s visit to Beijing.

Bangladesh-China friendship hospital in discussion

Sources said that the issue of giving importance to the health sector in cooperation is expected to be discussed at the foreign minister-level meeting in Beijing Tuesday. Dhaka has proposed to Beijing to sign an MoU to set up a specialised medical and rehabilitation centre with financial and technical assistance from China, especially for the treatment and rehabilitation of those injured in the student uprising.

Sources further said that Bangladesh is interested in signing an MoU quickly to construct the first friendship hospital, funded by China, in Purbachal. Bangladesh wants the hospital to be run by skilled physicians and professionals from China.

Apart from this, Bangladesh wants China’s cooperation in identifying high-quality hospitals in Kunming and adjacent areas to ensure medical services for Bangladeshi patients.

China’s Ambassador to Bangladesh Yao Wen told Prothom Alo Sunday morning, “We agree in principle to establish a hospital in Bangladesh. We are now waiting for a detailed proposal from Bangladesh. We want to know what kind of hospital Bangladesh wants and where this hospital will be constructed.”

“We will move forward following a process after receiving a proposal from Bangladesh. We are interested in modernising Bangladesh’s health sector,” he added.

China still interested in Teesta project

The MoU on sustainable management of river water, signed between the two countries in 2016, is scheduled to be renewed during the foreign adviser’s visit. The agreement signed between the Bangladesh Water Development Board (BPDB) and Power China is considered an outline MoU. Discussions are underway between the two countries on the Teesta project in continuation of this MoU.

Speaking about the Teesta project, Yao Wen said, “We are interested in assisting Bangladesh in this project. Now it is Bangladesh that will have to decide how to implement it.”

Diplomatic sources said the Bangladesh side at the meeting in Beijing will raise the construction of China’s mega dam in upstream of the Brahmaputra River. The country has taken the initiative to construct a dam worth about USD 100 billion in Tibet to generate about 60,000 MW electricity. This has created doubts about the availability of water for downstream countries. India has already expressed concerns over the construction of the dam.

The Chinese ambassador met with adviser Touhid Hossain on Sunday morning. Later, speaking about the construction of the dam in Tibet, the ambassador said that the construction will not have any negative impact on the downstream countries.

Bangladesh focuses on reducing interest rates

In the foreign minister level bilateral meeting, Bangladesh will put stress on investment, trade and project financing. In addition to reducing the interest rate from 2 per cent to a reasonable level, Dhaka will seek the cancellation of the 0.5 per cent loan commitment fee.

The meeting will also discuss important projects, including the procurement of four ships as per the previous agreement, especially the projects for which financing is currently stalled. Dhaka will also seek China’s cooperation on the Rohingya issue.

Bangladesh will also urge China to stand by the Rohingyas in the UN Security Council. At the same time, Bangladesh expects more investment from China.

After 5 August, China has come forward with an investment of over USD 200 million. The country is also one of the major trading partners of Bangladesh. Dhaka will seek cooperation in free trade of goods and raw materials, including delayed payment.

Bangladesh will also seek duty-free and quota-free facilities for Bangladeshi products in the Chinese market for an additional three years after graduating from a low-income country.

Asked about the China visit, foreign adviser Md. Touhid Hossain told Prothom Alo, “There will be discussions on advancing cooperation between the two countries, keeping in mind the five-decade anniversary of the relations. Our priority will be economic and development cooperation.”

* The report, originally published in the print and online editions of Prothom Alo, has been rewritten in English by Shameem Reza​
 

Bangladesh's trade deficit with China rises by over 1.0pc
Jasim Uddin Haroon
Published :
Jan 26, 2025 00:10
Updated :
Jan 26, 2025 00:10

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Bangladesh's trade deficit with China increased marginally by over 1.0 per cent to US$16.45 billion in the last fiscal year ending on June 30, compared to the same period a year earlier, according to the recently-released data from Bangladesh Bank.

During this period, Bangladesh imported goods worth $17.80 billion while exporting only $1.35 billion, resulting in a significant trade imbalance. Excluding services, the trade deficit stood at $16.28 billion in 2022-23 fiscal year.

China remains Bangladesh's largest trade partner, primarily supplying raw materials and semi-finished goods that are vital for Bangladesh's manufacturing industries. Among these goods ready-made garment (RMG) sector is key, which depends heavily on these imports to produce goods for both domestic consumption and export.

Economists argue that the trade deficit with China is not a cause for concern. They highlight that imports from China significantly contribute to Bangladesh's export-oriented industries, enhancing the country's export capabilities.

Dr. M. Masrur Reaz, chairman of Policy Exchange Bangladesh, a privately-owned think tank, noted that the trade deficit is a byproduct of China's cost-competitive goods dominating the Bangladeshi market. These include machinery essential for the RMG sector. "If imports from China grow, they positively impact Bangladesh's exports," Dr. Masrur said.

The rapid growth of Bangladesh's garment industry-employing around 5.0 million workers most of whom are women-has deepened trade relations with China.

As the world's second-largest apparel exporter after China, Bangladesh relies heavily on Chinese machinery and raw materials. Since 2018, China has been Bangladesh's largest trading partner, overtaking neighbouring India, now ranked second.

Chinese President Xi Jinping's Belt and Road Initiative (BRI) introduced in 2013 brought Bangladesh into the fold in 2016. During a state visit that year, President Xi pledged $40 billion for infrastructure projects under the BRI framework, cementing economic ties.

Dr. Zahid Hussain, another leading economist, emphasised the critical role of Chinese imports in supporting Bangladesh's growth, particularly in machinery and raw materials essential for export-driven and domestic industries.

"Most of our machinery and raw materials come from China," Dr. Hussain noted, adding that Chinese funding for BRI projects is more accessible than financing from multilateral organisations.

Industry insiders confirm the indispensability of Chinese raw materials for Bangladesh's competitive edge in international markets.

Syed Nazrul Islam, managing director of Well Dress, a subsidiary of Well Food Group, highlighted this dependency, saying "We can't afford not to buy from China; our entire supply chain would collapse."

He noted that that Chinese-made automatic sewing machines, widely used in factories, exemplify how imported technology drives Bangladesh's economic resilience.

President of Bangladesh Chamber of Industries (BCI) Anwar Ul Alam Chowdhury underscored the significance of Chinese imports in reducing production costs in the RMG sector. "We have no alternative to China," Mr. Chowdhury said, adding that Bangladesh also imports pharmaceuticals, cement, and chemicals from China at competitive prices.

Despite its trade imbalance with China, Bangladesh maintains trade surpluses with key Western markets, including the United Kingdom, the United States of America, and the European Union.

In fiscal year 2023-24, Bangladesh recorded a $3.76 billion trade surplus with the United Kingdom, $4.57 billion with the United States, and $18.57 billion with the EU's 27-member bloc.

Bangladesh's trade strategy effectively leverages Chinese raw materials to produce goods for export to these markets, contributing to its economic resilience and growth.​
 

Dam on Brahmaputra
Dhaka airs concern, Beijing says lower riparians won't be affected

FE REPORT
Published :
Jan 27, 2025 01:14
Updated :
Jan 27, 2025 01:14

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Bangladesh expressed concern over the construction of a mega-dam by China on the Brahmaputra during bilateral talks in Beijing on January 21 and got assurances that lower riparians won't be affected.

Foreign Affairs Adviser Touhid Hossain, who led the Bangladesh team, disclosed Sunday this and other outcomes of the meeting, adding that China has assured that the construction of the dam will not affect the lower-riparian Bangladesh.

In December last year, the Chinese government sanctioned the development of a hydropower facility on the lower section of the Yarlung Zangbo River, which is the Tibetan name for the Brahmaputra.

The $137 billion mega-infrastructure project to build the largest dam in the world has raised concerns in downstream countries, including India and Bangladesh, over potential impacts on water flow.

Responding to a question he said that a comparative analysis on the foreign loans provided to Bangladesh showed that China's lending rate is not that much higher, rather the lending rate of many other development partners are higher than China's.

"So the issue cannot be pushed strongly but when we raised it, they said they will consider it," Mr Touhid told reporters.

Replying to another question he said that there was no discussion on Dr Yunus's visit to Beijing.

The foreign adviser said China is interested to help Bangladesh in building a big and modern hospital in Bangladesh.

"And we are looking for land in Purbachal Town are for this" he said, adding that China is interested to provide support for another tertiary-level hospital on a private-public-partnership basis.

During the bilateral meeting, Chinese Foreign Minister Wang Yi also requested Bangladesh to consider joining President Xi's three global initiatives, namely GDI, GSI and GCI, and in response Bangladesh conveyed intention to examine the proposals and to remain engaged with China in deliberations on the issues, the adviser said.

Both the countries also agreed to collaborate on each other's candidature in multilateral for a, including in the United Nations.

The bilateral talks concluded with the signing of the 'Implementation Plan of the MoU on Exchange of Hydrological Information Sharing of the Yaluzangbu-Jamuna River'.

Mr Touhid said the MoU on water-management cooperation could not be renewed as both sides intended to add some new clauses to the existing memorandum.

The Foreign Adviser also had a meeting with the Minister of International Department of Chinese Communist Party. During the meeting, they discussed Chinese-funded development projects in Bangladesh.

They also talked about the reform initiatives of the interim government in Bangladesh. The Chinese Minister reaffirmed China's continued support to the interim government and peaceful transition to democracy through a free, fair and participatory election.

Mr. Hossain, during his January 21-24 China trip, also held a meeting with the Chairman of China International Development Cooperation Agency (CIDCA) discussing bilateral economic-cooperation issues.​
 

Dhaka-Beijing agree to renew MoU on sustainable water management after modifications: Touhid
Diplomatic Correspondent
Dhaka
Published: 26 Jan 2025, 23: 07

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Foreign Affairs Adviser Md Touhid HossainFile photo

Dhaka and Beijing signed a memorandum of understanding (MoU) on sustainable water management during the Chinese president’s visit to Bangladesh in 2016.

Both the countries have agreed to renew the MoU after some modifications, said foreign adviser Touhid Hossain.

The adviser on Sunday disclosed this in response to a question of a newsperson at a media conference at the foreign ministry this afternoon after his visit to China.

He said as both Dhaka and Beijing agreed to renew the bilateral MoU, both sides have been trying to find out what modifications could be made.

“We have shared our observations with Beijing, and they have shared theirs with us. Finalising the draft will take some time, but it will be completed. Some more issues will be added to the renewed deal. This is why it is taking time,” he said.

Touhid Hossain, however, confirmed that a MoU was signed on exchanging hydropower-related information on the Yaluzangbu-Jamuna River during his visit.

The adviser said during the talks he raised Dhaka’s “serious concerns” regarding a dam on the Brahmaputra, a trans-boundary river that originated in China and enters into Bangladesh through India. “We have also requested China to share the studies they are conducting on this matter with us. They ensured that the flow of water will not decrease because of them.”

Asked if they had any discussion about prospective Chinese assistance for the Teesta River Project, Touhid Hossain said, “There was no discussion on the Teesta”.

“If we want to have any discussion on this, that MoU (water management) will have to be signed first. This is why it will take some time,” he added.

When a newsperson asked him whether there was any discussion on the visit of Dr Yunus to China, he said, “Let me tell you the truth, there was no discussion on this. Because, we are not hurrying on this.”

The foreign adviser had an official visit to China on 20-24 January. This was Bangladesh’s first bilateral meeting with China after the interim government had assumed power.

The adviser also spoke about US President Donald Trump’s decision to cut aid.

He said this was “expected” and clarified that USAID’s temporary aid suspension is not specific to any particular country.

After assuming office, Donald Trump recently issued an executive order suspending US aid to all countries, except one or two, for 90 days to allow a review of the assistance programmes, a decision not targeting any specific nation.

Following the order, the United States Agency for International Development (USAID) directed an immediate suspension of funding for all ongoing projects and programs in Bangladesh, as in other countries.

In response to a question on the impact of US assistance to Rohingya people, who have taken shelter in Bangladesh, due to this decision, Touhid Hossain said that they were entering a new reality. There should not be any doubts about that. Everyone knew beforehand the new US president’s policies are different from the existing one’s.

He said they will have to watch how the situation pans out and find out how to protect the interests of Bangladesh as per the emerging situation.

News agency BSS adds: Touhid Hossain Sunday announced that China has decided to designate two to three hospitals in Kunming, the nearest Chinese city from Dhaka, for Bangladeshis, who face problems in obtaining Indian visas for medical treatments.

“We were looking for an alternative destination for medical treatment as visa problems have been persisting with India. We believe this is a viable alternative given the issues with Indian visas,” he told reporters while sharing the outcomes of his recent China visit.

The adviser said the deputy governor of Yunnan with Kunming being its capital traveled to Beijing to meet him and conveyed the decision to dedicate the hospitals for Bangladeshi patients.

“I requested them (Chinese authority) to simplify the visa procedure and reduce the visa fees for Bangladeshi treatment seekers,” Hossain said.

The adviser revealed that the Chinese government has agreed to construct a large public hospital on government-owned land in Purbachal on the outskirts of Dhaka.

“We will provide the land (for the purpose) as soon as possible,” he said adding in addition to the public hospital a plan was chalked up to establish a tertiary-level hospital under public-private partnership (PPP) with China.

Hossain was on an official tour to Beijing from January 20 to 24 at the invitation of his Chinese counterpart Wang Yi when he held a bilateral meeting with him and visited Shanghai to meet with the Chinese business community.

“We discussed all our bilateral matters, including development projects and trade and commerce,” said Hossain, adding that he requested Beijing to lower the interest rate on loans and extend the loan repayment period from 20 years to 30 years.

He said the Chinese foreign minister “assured me of extending the loan repayment period and promised to look into the request for a reduction in interest rates”.​
 

China second biggest investor in Bepza zones after Bangladesh

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Chinese investment in all eight export processing zones (EPZs) of the Bangladesh Export Processing Zones Authority (Bepza) and its economic zone in Chattogram is only exceeded by domestic investment, show documents of the government agency.

So far, companies from a total of 38 countries have invested in the Bepza EPZs. Bangladesh ranks first in terms of investment, with 148 of its local companies having vested interests in these industrial enclaves.

China holds the second position as 108 of its companies have invested in EPZs, while South Korea follows with 62 companies.

The number of foreign firms invested in local EPZs also includes 30 from Japan, 19 from India, 19 from the UK, 17 from the US, 10 from Canada, seven from Sri Lanka, and six from the Netherlands.

Bepza Chairman Major General Abul Kalam Mohammad Ziaur Rahman informed that US President Donald Trump has announced plans to impose a 10 percent tariff on Chinese goods from February 1.

"This will raise the price of Chinese products in the American market. Consequently, the products will lose competitiveness," he said.

So, many Chinese entrepreneurs have started relocating their industries to other countries, with Vietnam, Cambodia, Indonesia, Sri Lanka, Myanmar, and Bangladesh becoming their preferred destinations.

"Among these, Bangladesh ranks as the top choice," Rahman said.

"We are seeing significant interest from Chinese firms to invest in the country. Just three or four days ago, we received a proposal for a $150 million investment," he added.

Rahman also highlighted the demographic challenges in China.

"The number of young people in China has decreased, leading to a shortage in its workforce. As such, those available are demanding significantly higher wages."

The Bepza chief addressed concerns regarding foreign direct investment (FDI) in Bangladesh, particularly in the aftermath of last August, when the Awami League government was ousted by a mass uprising.

"Numerous investors are actively reaching out with plans for new investments, which reaffirms the country's potential for FDI," he said.

At present, there are 449 industrial establishments operating in the eight EPZs under Bepza and the BEPZA Economic Zone in Chattogram.

They have generated employment for 524,385 people, with a total investment of $6,914 million.

The combined area of the eight EPZs and BEPZA Economic Zone is only 3,445 acres. However, these industrial areas contributed 29 percent of the country's total FDI in fiscal 2023-24.

Data from the Bangladesh Bank shows that FDI inflows amounted to $1,468 million in the last fiscal year, with $424 million of the total coming as investments in the EPZs.

Ashraful Kabir, member for investment promotion at BEPZA, noted that by reducing reliance on garment making, the EPZs are strengthening the country's economic foundation through product diversification and export expansion.

"Beyond garments and garment accessories, 48 percent of the products manufactured in the EPZs are now diversified items," he said.

Bepza began developing its ninth industrial area, the Bepza Economic Zone, in 2018 on 1,138 acres of land in Mirsarai, Chattogram.

The project, which is still underway, aims to construct 539 industrial plots and 45 factory buildings.

So far, 42 domestic and foreign investors have signed agreements with Bepza to collectively invest $970.91 million in this zone. Of the planned industrial plots, 249 have already been allocated.

Bepza has also initiated land development for two EPZs in the Jashore and Patuakhali districts.

The Patuakhali EPZ, spanning 410.78 acres, will feature 306 industrial plots. It is expected to attract investment of $1,530 million, generate $1,836 million in annual exports, and create 100,000 opportunities for direct employment and 200,000 opportunities for indirect employment.

The Jashore EPZ, covering 503 acres, will comprise 400 industrial plots. Bepza anticipates that this zone will draw investments of $2,000 million, generate $2,400 million in annual exports, and create 150,000 direct jobs and 300,000 indirect jobs.​
 

China-funded Mongla seaport dev project gets going
FHM HUAMAYN KABIR
Published :
Jan 28, 2025 00:20
Updated :
Jan 28, 2025 00:20

Close on the heels of Dhaka-Beijing talks for an update on relations, the interim government may approve the much-awaited China-funded Mongla-seaport-development project tomorrow (Wednesday), officials said.

The project was sent back from the Executive Committee of the National Economic Council (ECNEC) in 2020 as the ousted Sheikh Hasina government favoured a similar project proposed to be funded by India, they said Monday.

The Planning Commission (PC) is going to place the stalled project proposal before the ECNEC, expected to convene Wednesday.

Issues involving the Dhaka-Beijing cooperation, apparently are gathering pace following Foreign Affairs Adviser Touhid Hossain's maiden China mission after the August-5th student-mass uprising brought regime change. He came back from China on January 23 after the four-day visit when he had talks with the Chinese foreign minister.

"We are going to place the China-funded Tk40.68-billion project for the Mongla port upgrading as Bangladesh's current interim government is also interested to build good relations with Beijing like with other neighbouring countries," says a senior PC official.

China has assured Bangladesh of providing Tk 35.93 billion or US$335.78 million worth of loan for implementing the proposed port-development project, deemed important as the Mongla is set to become a regional porting hub.

Earlier in 2020, the past government allowed Indian financial support for a separate project on upgrading the Mongla seaport, now gaining prominence with major communications-infrastructure development done by China in the region connecting the capital, Dhaka.

Currently, the Mongla Port Authority (MPA) under the Ministry of Shipping has been implementing the Tk60.15-billion project since 2020 for upgrading the port with part financing of Tk44.59 billion from Indian loans.

During the visit of the Foreign Adviser, China proposed to Bangladesh government for making investment in Mongla-seaport development, among other areas of cooperation.

Dhaka considered the proposal on a positive approach as it wants more concessional loans and their speedy confirmation from Beijing to upgrade infrastructures as a couple of the assured loans is pending for years, said government officials.

A few years back, Beijing proposed to invest in Bangladesh's second-largest port, Mongla, for the development, a senior Economic Relations Division (ERD) official said.

Earlier, the project was put on hold by the deposed Sheikh Hasina government allegedly on "geopolitical considerations" in September last year, he added.

Another PC official says they had scrutinised the China-funded project proposal more than a month back.

"Now the government high-ups have given the green signal to place the proposal before the next ECNEC meeting for approval. So, we are going to place," the PC official adds.

The MPA more than a month back sought approval for Tk 40.68 billion as cost of 'Expansion and Modernization of Mongla Port Facility Project' where China has proposed to provide Tk 35.93 billion (nearly US$335.78 million) in loan.

"We have scrutinised the project and sent to Planning Adviser Dr Wahiduddin Mahmud for endorsement before placing to the ECNEC more than three weeks ago. Now he has given the green signal for placing before the ECNEC," says another PC official.

The MPA signed a memorandum of understanding (MoU) with China Civil Engineering Construction Corporation (CCECC) on August 24, 2021 and the latter submitted its financial bid and technical proposal on January 28, 2023.

The CCECC will be assigned to build two new container jetties, a loaded container yard, an empty container yard and a hazardous cargo-handling yard.

Expansion and Modernisation of Mongla Port Facility project was listed among the 27 development projects that China pledged to fund by signing an umbrella deal back in 2016 during President Xi Jinping's visit to Dhaka.

Construction of two container jetties will enhance Mongla seaport's container-handling capacity by 394,000 twenty-foot-equivalent units (TEUs) per annum.

Following construction of many mega-infrastructures, particularly in Bangladesh's southern part-especially the Padma Bridge-the Mongla seaport's importance has increased manifold with vistas of opportunities in trade and connectivity opening up.

It has now become nearest seaport to the capital, Dhaka, and recently many international shipping lines have shown interest in plying to the port.

The entire western part of Bangladesh and its adjoining areas are considered hinterland, having a unique opportunity to play vital role in the arena of international and regional trade and economy, officials told their Chinese counterparts regarding the importance of the project.

In unlocking its potential the Mongla seaport recently registered a record in terms of ship arrivals, cargo handling, and revenue earning.

In 2020, the port saw a turnout of 970 ships-the highest in its 70-year history. It earned a profit of Tk 1.30 billion from the limited-scale port operations.​
 

China to upgrade Mongla port
Staff Correspondent 03 February, 2025, 00:41

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Mongla port. | File photo

The interim government on Sunday approved a project aiming at upgrading the container terminal at the Mongla port in Bagerhat with a loan of Tk 3,592.90 crore from China.

The Bangladesh government will contribute the remaining Tk 475.33 crore to the overall project cost of Tk 4,068.23 crore approved by the executive committee of the National Economic Council at the Planning Commission at Agargaon in the capital Dhaka.

At a post-meeting briefing, planning adviser Wahiduddin Mahmud said that the port would be developed as a hub, serving the regional countries like Bhutan and Nepal.

China has long been showing a keen interest in financing the project, he said.

Shipping ministry officials said that the same project had been submitted to the ECNEC in 2020 seeking approval, but the proposal was sent back then.

Under the project now to be concluded in 2028, the port authorities will construct a container terminal with equipment, delivery yard, multi-storied car sheds, removal of sinking wreckages and improvement of main roads.

Lack of infrastructures in the port has failed to attract ships, with about 40 per cent of its berthing facility remaining unutilised.

At present, the port authorities have been implementing several projects, including the upgrading of Mongla port project at Tk 6,015 crore since 2020 with Tk 4,459 crore from an Indian loan.

The planning adviser said that foreign loans were bad, but those became burden if not invested in viable projects.

Fearing that the overall debt payment would face more pressure in the coming days due to the implementation of the mega projects by the ousted Awami League regime, he suggested higher revenue mobilisation by the National Board of Revenue.

The day’s meeting, presided over by chief adviser Muhammd Yunus, approved 13 projects at Tk 12,532.28 crore. Of the cost, Tk 4,097.23 crore will come from the local sources and Tk 7,328.95 crore from the foreign sources.

Of the approved 13 projects, nine are new projects while four are revised projects.

The other projects include Uttar Kattali catchment sanitation in Chattogram metropolis (Tk 2,797.22 crore), improved seed production and development of rice, wheat and corn, 3rd phase (Tk 474.68 crore), modernisation and development (2nd phase) of seed production, processing and distribution management of BADC (Tk 292.86 crore), food safety testing capacity development (Tk 2,409.70 crore), digging some four evaluation-cum-development wells of Titas and Kamta fields (Tk 1,255 crore), conducting three-seismic survey at Habiganj, Bakhrabad and Meghna fields (Tk 454.25 crore) and digging Sylhet-12 number well (oil well) (Tk 255.25 crore).​
 

Tapping into China’s industrial relocation
A golden opportunity for Bangladesh?


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Chinese Foreign Minister Wang Yi tells Chief Adviser Prof Muhammad Yunus that China wants to invest in the production of solar panels in Bangladesh, on September 25, 2024. PHOTO: CA OFFICE

Over the last four decades, China has established itself as the leading hub for manufacturing on a global scale. In the late 1970s and early 1980s, the implementation of economic reforms under Deng Xiaoping facilitated the entry of foreign direct investment (FDI) in China's economy, prompting numerous companies to shift their manufacturing operations to the country. Nonetheless, the persistent difficulties faced by the world's second largest economy, including geopolitical tensions with the United States, environmental regulations and overcapacity in manufacturing have led China to relocate various industries to friendly nations in Southeast Asia, South Asia and Central Asia. It's pertinent to analyse China's industrial relocation and how Bangladesh can benefit from it.

Why are Chinese industries relocating?

First, China is undergoing a significant transformation, influenced by a variety of economic, geopolitical, environmental and policy issues. This transition is driving Chinese companies, especially in low-end manufacturing, to explore alternative regions that provide improved market access with greater outputs. China has been experiencing an upsurge in production wages and production costs in recent times, which has led to a decline in the cost competitiveness, once considered to be the strength of Chinese economy. Furthermore, stringent environmental regulations have led to a shift in compliance expenses that's influencing rendering domestic industry to other regions. Last year, Chinese Premier Li Qiang outlined the yearly economic growth target of five percent during his inaugural working report at the National People's Congress. He emphasised the need for a significant advancement through the acceleration of industry modernisation and the "development of new quality productive forces." The approach that Li Qiang spoke of entails a systematic transition towards high-end, smart and clean manufacturing sectors, with a strategic relocation of several domestic industries to emerging economies in their geographical proximity. In the context of emerging economies, Bangladesh presents itself as a suitable region for attracting these shifting industries.

Additionally, the ongoing tensions in US-China trade and broader decoupling trends are prompting Chinese firms to adopt a "China Plus One" strategy aimed at diversifying their production bases to mitigate geopolitical risks. Southeast and South Asia have emerged as significant relocation centres in response to rising tariffs and intensified trade barriers between China and Western countries. Chinese firms recognise that the developing nations in South and Southeast Asia possess adaptable tariff regulations when engaging with the US and Western markets. In the same scenario, Chinese FDI in Mexico reached a 13-year high in 2023, with capital expenditure surging to $5.6 billion, up significantly from $267 million in 2018. This "near-shoring" move was intended to exploit benefits of exporting goods to the US produced in Mexico under the USMCA agreement.

Moreover, in the context of China's recent five-year plans, it is evident that the country is strategically shifting its focus from its previous role as the "world's factory," which was characterised by the production of low-cost, low-tech goods supported by competitive labour costs and supply chain efficiencies. China's new industrial policy of "Made in China 2025" aims to enhance the manufacturing capabilities of Chinese industries, transitioning from labour-intensive operations to a more technology-driven, sophisticated industrial hub. The focus on high-tech productive forces, including electric vehicles (EVs), artificial intelligence (AI), and cutting-edge semiconductors, is expediting the relocation as well.

Bangladesh as a potential destination

Bangladesh has always been a viable destination for Chinese firms as it offers some significant benefits that Chinese companies enjoy at home. Till date, Bangladesh can offer the most competitive wages compared to other viable destinations in the region. The average monthly wage of an industrial worker still remains below $150 that makes it lucrative for manufacturing industries. Additionally, the young labour force in Bangladesh presents a significant long-term benefit for industrial production. The country boasts a demographic dividend where more than 65 percent of its population is under 35 years old. Moreover, the geographical location of Bangladesh in the crossroad of the Indo-Pacific region makes it a suitable transportation and logistical hub for international shipping of produced goods. As of present circumstances, Bangladesh can offer duty-free access to European markets as well with zero tariffs on EBA (Everything but Arms) scheme and curtailed tariffs on goods exported to the US, Japan, Australia and other countries. Bangladesh also offers dedicated Export Processing Zones (EPZs) and Special Economic Zones (SEZs) for attracting FDI, especially in the coastal region.

Chinese industries relocating matter for Bangladesh

The Bangladesh Economic Zones Authority (BEZA) has established a structured timeline aimed at operationalising five economic zones within the next two years, out of a total of 100 proposed zones all over Bangladesh. These zones are vital for attracting FDI from Chinese firms aiming to relocate their operations. It is noteworthy that China holds the second position after Bangladesh; 108 companies have invested in EPZs. According to data from the Bangladesh Bank, FDI inflows reached $1.46 billion in FY2023-24, with $424 million of this total attributed to investments in the export processing zones. Ashraful Kabir, who serves as a member for investment promotion at BEZA, highlighted that in addition to RMG products and accessories, 48 percent of the products manufactured in the EPZs have now diversified into other categories. He noted that decreasing dependency on RMG production allows the EPZs to enhance Bangladesh's economic stability by promoting product diversification and expanding export opportunities. Chinese firms invested $283 million in FY2023-24, and China is the third largest FDI source for Bangladesh that stands with $1.56 billion in total as of June 2024.

It is worth noting that the growth in the manufacturing sector has been sluggish compared to the service sector. In 2013, the number of economic units of the industrial sector was 9.2 million, which increased to 1.04 million in 2024. The growth rate has increased by 15.38 percent in a decade. The slow rate of pace in Bangladesh's economy does not end here; the number of unemployed people in the country has increased to 2.66 million, according to the Bangladesh Bureau of Statistics (BBS) for the period of July-September 2024. Bangladesh must feel the urge to attract Chinese industries to invest and increase FDI to overcome this stagnation. The head of the Chinese Communist Party's (CCP) International Department, Liu Jianchau, said to Bangladesh Foreign Affairs Adviser M Touhid Hossain during his recent visit that China is thinking of relocating its industries and they are considering Bangladesh as an option. They also think that exporting the manufactured goods to other countries from Bangladesh and the matter of incentives in exports will be beneficial to China.

Challenges ahead

However, the existing infrastructure presents significant challenges with shortage of energy and port delays contributing to increased expenses and diminished investor trust. The government has initiated large-scale EEZs; however, the pace of project implementation is not satisfactory. It is an undeniable fact that Bangladesh has administrative inefficiency and bureaucratic complexities in attracting foreign investment, which introduces an additional layer of complexity. Policy reforms are needed now to attract Chinese investment despite advantages. Tax concessions, tax holiday, and ease of doing business should be prioritised to attract relocating industries. Bangladesh has a shortage of skilled labour force to propel newly relocated industries. It will continue to be a significant area of concern if no comprehensive action plan from the government is taken.

Foreign investors endure significant challenges in Bangladesh due to intricate, often bureaucratic, approval procedures from various government agencies that must be fixed to harness relocating Chinese industries. Regional competitors like Vietnam and Indonesia have already streamlined their investment frameworks to facilitate the relocation of Chinese industries. Should Bangladesh not implement necessary reforms to its regulatory framework and expedite investment processes, it may face significant challenges in maintaining its competitive edge in international trade.

Md Sakib Hossain is a political and international relations analyst based in Dhaka.​
 

Bangladesh takes steps to address China’s concerns over textbooks, map
UNB

Published :
Feb 13, 2025 20:35
Updated :
Feb 13, 2025 20:35

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Bangladesh has said it has taken measures to address some objections raised by China regarding two Bangladeshi textbooks and the map displayed on the website of the Survey of Bangladesh.

The Chinese Embassy in Dhaka informed Bangladesh through a diplomatic note on November 28, 2024, about China’s objections to the map used in the textbook, the inconsistency of the data, and a boundary line mentioned in the Survey of Bangladesh, Spokesperson at the Ministry of Foreign Affairs Mohammad Rafiqul Alam told reporters at a media briefing on Thursday.

In view of this, he said, the Ministry of Foreign Affairs has requested the authorities concerned to review the matter and take necessary measures.

Alam said the Ministry of Foreign Affairs is in regular contact with the authorities concerned regarding the progress of the matter.

Beijing, as reported by media, asserted that in addition to this “factual discrepancy”, both the textbooks and the survey department’s website have incorrectly portrayed Hong Kong and Taiwan as separate countries instead of recognising them as part of China.​
 

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