Bangladesh has been buying stuff from China and China has been happy selling stuff to Bangladesh, without much concern for doing some shopping of its own. That is now about to change.
Prime Minister Sheikh Hasina currently in the middle of a five day visit to China carried with her great hope that China would invest in Bangladesh’s agriculture and infrastructure and support the sagging export market in an attempt to rectify a distortionary trade deficit. Her hopes have have been realized into promises of policy.
As the Daily Star reports:
“China will allow duty-free access of Bangladeshi products to its markets and increase its support for the country’s efforts to face floods and other natural calamities caused by global warming.””
Chinese Prime Minister Wen Jiabao gave the assurance during official talks with Bangladesh Premier Sheikh Hasina held at East Hall of Great Hall yesterday afternoon.”
“During the talks, the two leaders discussed various issues of bilateral interest as well as Chinese support and cooperation for Bangladesh’s socio-economic sectors.”
Sheikh Hasina claimed that Bangladesh’s relationship with China began with her father’s visit to the mainland in 1953. This is a baldly self-serving move to claim a certain historic imprimatur that attaches solely to the current Awami League, nevertheless there is something to the claim. Certainly China’s relationship with Bangladesh–notwithstanding a 1953 visit by a small-time politician traveling from the eastern wing of the newly independent and enfeebled Pakistan–is stronger and perhaps more obdurate than the budding rapprochment between India and Bangladesh. Indeed, India might have some to reason to worry . India’s recent investments in Bangladesh’s power-grid is meant to be welfare increasing for Bangladeshis, though much of the benefits will flow to India. Now China is investing some of the same industries. The monetary value of those investments is likely to outstrip India’s promised investment. One wonders whether China’s investment might yield a negative externality on India promised investment.
China’s Premier Wen Jiabao congratulated Sheikh Hasina on her recent procedural and substantive policy successes. Though his congratulatory notes ring hollow as just so many democratic platitudes, to Bangladesh’s business leaders the promises of cash and expertise are sure to come across in undulating, sonorous tones.
