On 4 October 1975, China officially established diplomatic relations with Bangladesh. Five decades later, both countries have made significant advancements in areas of economic and defence collaboration.
2025 marks the 50th anniversary of the establishment of China-Bangladesh diplomatic relationship and is also the ‘China-Bangladesh Year of People-to-People Exchanges’. Despite the countries not sharing territorial borders, trade relations between the two reached a new height in 2006 when China replaced India as Bangladesh’s largest trading partner. China’s growing influence in a strategically significant region is a matter of concern for India, as it directly challenges its regional dominance. More recently, the interim government headed by Professor Yunus is aligning Bangladesh with China and Pakistan, which has added another layer of complexity to India’s diplomatic strategy. As Bangladesh’s largest trading and defence partner, China’s relationship with Bangladesh is multifaceted in nature and the bilateral ties are defined by a combination of political practicality, strategic interdependence, and pragmatism.
Historical Ties
Bangladesh-China relations are not a recent phenomenon, nor are they purely political. They are based on a deep-rooted history of friendship and cultural exchanges for over a thousand years. The historical link dates back to the second century BC, when Han dynasty envoy Zhang Qian documented dynamic civilisations in Magadha, current day Bangladesh. Over the following centuries, Chinese Buddhist monks Xuanzang and Fa Xian travelled to the region in the pursuit of knowledge, while Bengali scholar Monk Atish Dipankar went to China to spread Bengal’s spiritual and cultural heritage. During the 14th and 15th centuries, the sultans of Bengal used to send regular diplomatic missions to the Ming Dynasty, reciprocated by Admiral Zheng He’s historic voyages to Bengal, which the Chinese referred to as “Pang-ge-la” which evolved into the modern form of “Meng-jia-la”, the contemporary Chinese pronunciation for Bangladesh.
Strategic Cooperation and Development
The Belt and Road Initiative (BRI) is often dubbed as a grand strategy or a geoeconomic strategy put forward by Beijing and is present in all continents except North America. Bangladesh was the first South Asian country to join the BRI, which bolstered interdependence between the two countries. Over the last decade, China has released $4.45 billion for 35 projects as part of the BRI in Bangladesh. Infrastructure projects in sectors like transportation, energy, power, and communications have enhanced both connectivity and trade. They demonstrate the strength of China’s economic capacity and specialisation in mega projects that include the Bangabandhu Sheikh Mujibur Rahman Tunnel and the Padma Bridge Rail Link, among others. Furthermore, there remains potential to attract further investments in high-end manufacturing industries that could create jobs and accelerate industrial growth. Meanwhile Chinese companies are also starting to relocate sunset industries to Bangladesh, not least of course in an attempt to bypass increasing trade barriers on the global level.
Within the framework of the BRI, Bangladesh is a significant partner in both the Silk Road and Economic Belt initiatives. As part of broader geopolitical developments and realignments in South Asia, smaller countries are increasingly turning to China for both military and economic support. Bangladesh has a strategic position connecting South Asia to Southeast Asia. As China seeks to expand its influence in South Asia, Bangladesh must navigate a delicate balancing act in its foreign policy decisions and retain its strategic autonomy to avoid becoming a pawn in a larger geopolitical game. Otherwise, it could head down the path of becoming a satellite state of Chinese influence in a region where China could potentially challenge Indian domination.
Bilateral Trade
In 1995, China exported $652 million worth of goods to Bangladesh. Nearly thirty years later in FY24, Bangladesh imported goods worth $16.63 billion from China, representing 26.4 percent of the country’s total imports for that year. Under the Asia-Pacific Trade Agreement, which has been effective from September 2022, Bangladeshi goods were granted 100 percent duty-free access to the Chinese market. However, Bangladesh has yet to fully benefit from this economic partnership as Bangladeshi exports to China remain low. While Bangladesh’s main exports to China include t-shirts, tanned equine and bovine hides, and knitted fabric, the trade deficit is not decreasing, primarily because Bangladeshi exportable goods are limited in range, require stringent value addition, and lack competitiveness in key sectors. Despite the huge trade deficit, Bangladesh can expand in areas such as ready-made garments, and leather and agricultural goods. Hence, portfolio diversification should be a top priority on Dhaka’s agenda to improve market access for Bangladeshi goods. Beyond trade, Dhaka and Beijing are committed to accelerating strategic partnerships in existing projects as well as expanding cooperation in developing economic zones, industrial parks, and oil and gas exploration.
Foreign Direct Investment
Although Bangladesh has taken numerous measures to attract foreign direct investment (FDI) through maintaining good relations with Japan, the US, Russia, and India, it is China which has emerged as Bangladesh’s key economic development partner and largest foreign investor, evidenced by its FDI, which increased 10.9 times between 2011 and 2019. While Chinese investments primarily focus on infrastructure financing, they also include various sectors such as energy, information technology, defence and education which includes the recent donation of a second smart classroom by the Chinese embassy in Bangladesh. Beijing has expressed that its relations with Bangladesh are based on mutual trust and shared development goals, which is why China has been willing to fund initiatives that are significant to Bangladesh, but which were previously rejected by Western funders. It is also not a coincidence that China continues to demonstrate a strong desire to cooperate with South Asian nations more generally, especially given that they offer access to the Indian Ocean and might help China strategically contain India. For Bangladesh to diversify its FDI portfolio it must streamline its investment framework through regulatory reforms, as its intricate and often bureaucratic procedures pose an obstacle to keeping a competitive edge in international trade.
Sustainable Financing
Concerns have been raised over sustainable financing in the region, in particular about the durability and transparency of Chinese investments. Bangladesh, a member of China’s BRI owes Beijing $4 billion, or 6% of its total foreign debt. Because of these reasons, a number of BRI infrastructure projects in Bangladesh, such as the construction of a 5G network for the state-owned telecom company Teletalk as well as other road building projects have been abandoned or delayed. Although FDI has brought Bangladesh considerable economic benefits, opinions in the country over China’s involvement and the possible social and environmental effects of Chinese-backed initiatives remain polarized. Furthermore, some Chinese-backed projects in Bangladesh have not performed as per expectations, which has caused concern among some analysts given the current economic situation in Pakistan and Sri Lanka, two countries which have also received significant amounts of Chinese investment. Nonetheless, Bangladesh appears to be reaping the benefits of great power competition in its dealing with China and India.
Military Cooperation
Historically, Bangladesh primarily relied on India and the Soviet Union for military aid. However, given the recently deteriorating relations with India due to border disputes, the treatment of minorities, and having failed to secure a deal for F-16 fighter jets, Bangladesh has increasingly turned to China as its preferred defence partner. Between 2009 to 2014, Bangladesh imported 82% of its armaments from China via credit and soft loans. Currently the Bangladesh armed forces operate Chinese fighter jets, missile systems and Ming-class submarines. Dhaka is negotiating a significant defence deal with China to purchase advanced technology such as the J-10C multirole fighter jet and attack helicopters to replace the Bangladesh Air Force’s ageing MiG-29 and F-7 aircrafts. Bangladesh is relying on China to modernise its armed forces, and its strategic calculations seem to be driven by a desire to strengthen its defence posture and assert its regional power in a neighbourhood where it faces multiple security challenges. Bordered by India to the west and north, and Myanmar to the east, Bangladesh has built a submarine dock at Pekua in Cox’s Bazar with Chinese help to safeguard its sovereignty and deter any potential aggression. A modern and well equipped Bangladeshi armed forces will send a strong signal to its neighbours about its growing military capabilities.
The Road Ahead
The interim governments Chief Adviser Professor Muhammad Yunus officially visited China between 26-29 March 2025. In a joint statement released on 28 March, the jubilee year would deepen bilateral cooperation across various sectors, including culture, tourism, media, education and healthcare, as well as also include think thank partnerships. Bangladesh has a strategic opportunity to leverage its strong cultural and social ties for sustainable social and economic benefits such as creating youth employment opportunities through modern skill development, which align with Bangladesh’s immediate needs. Recent research findings presented at a seminar titled, ‘National Image of China in Bangladesh’, pointed to overwhelmingly positive opinion among Bangladeshis towards China in relation to technology transfer, opportunities for higher education, medical tourism, and a strong trading partnership. Moreover, China’s model of ‘Common Prosperity’ and sustainable development – ‘Ecological Civilisation’ echoes the vision of Professor Yunus’s concept of a ‘World of Three Zeros’ – Zero Poverty, Zero Unemployment, and Zero Net Carbon Emissions.
Conclusion
Although historic figures like Zhang Qian, Fa Xian, Atish Dipankar, and Admiral Zheng He forged good relations between the two civilisations, current Bangladesh-China bilateral relations should be viewed in the context of contemporary regional as well as international dynamics. The contours of Bangladesh-China relations are multifaceted and include several factors which have drawn both countries towards each other. This relationship has raised concerns in India and has the potential to impact the geopolitical balance in South Asia, leading to a re-evaluation of alliances and partnerships. At the regional level, China can act as a balancer to counter a potential hegemony of India over the South Asian region. It has long been believed in Bangladesh that India wants a monopoly over its smaller neighbour, something that was possible under the previous regime of Sheikh Hasina. But following the July mass uprising, China’s strategic engagement with Bangladesh has become deepened. China’s growing regional influence through economic activity and the possibility of tying up Bangladesh through debt trap diplomacy is turn is becoming a growing concern for India.
China has emphasised that its policy towards the people of Bangladesh is based on friendship and mutual respect and Bangladesh-China bilateral relations are not a one-way street, particularly as Bangladeshi businesses are finding connectivity with China is easier compared to other countries. China’s strategic use of its health and tourism sectors only deepened engagement with the Bangladeshi public. Professor Yunus’s visit to China further strengthened the comprehensive strategic cooperative partnership between the two countries. While Bangladesh accepts Chinese economic support, it is prudently balancing relations by circumventing security predicaments and navigating sensitive infrastructure projects like the Teesta River. As the Yunus government redefines Bangladesh’s foreign policy, it refuses to be dictated by external forces and views itself as an equal and sovereign player on the global stage. How well it balances regional and global interests will determine the future trajectory of Bangladesh-China relations in a rapidly evolving geopolitical landscape. Bangladesh can strengthen its democracy and economic standing without compromising its core values.