China in Bangladesh: Developing Infrastructure or Deepening Influence

Rahul Nath Choudhury ()
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Rahul Nath Choudhury: Indian Council of World Affairs

Chapter Chapter 4 in Mapping Chinese Investment in South Asia, 2023, pp 65-93 from Springer

Abstract: Abstract Bilateral relationship between Bangladesh and China started with Chinese government recognising Bangladesh in 1975. Since then the relationship between them has flourished and transformed from a normalcy to all weather friends (Uddin & Bhuiyan, 2011). Bangladesh and China developed their relationship considerably through different bilateral cooperation agreements, economic pacts, trade policies, and joint economic and business associations while gradually expanding the areas of cooperations (Quiyum, 2020). Now, both the nations share a very close diplomatic tie in the region. The bilateral diplomatic engagement is supplemented by a large volume of trade and investment flow. Like any other South Asian economy, Chinese investment in Bangladesh has increased exponentially over the last few years. The gross Chinese foreign direct investment (FDI) increased from US$69.73 million in 2015 to US$444.85 million in 2021 (Bank of Bangladesh, 2015, 2021). Noteworthy, China is the largest investor in Bangladesh only after the US. Chinese capital has flown primarily to textiles, power generation, and construction sector. Chinese investment in Bangladesh’s power generation and construction sector are also made under the BRI. China pledged to invest around US$38 billion in the country—the third highest in South Asia, after Pakistan (Bhattacharjee, 2021). In case of trade also, China and Bangladesh share a strong relation though it is highly in favour of China. The bilateral trade increased from US$14.7 billion in 2015 to US$22.25 billion in 2021. China contributes the highest share in Bangladesh’s total import from the world which predominantly consists of textile products, machinery, and refined petroleum products. With this background, this chapter aims to explore the Bangladesh-China relationship from three distinct perspectives, viz. diplomatic and strategic relationship, trade flows, and investment volume. However, central discussion of this chapter will primarily revolve around the Chinese investment in Bangladesh. This chapter will also cover the Chinese investment made in Bangladesh under BRI.

Keywords: China; Bangladesh; Padma Bridge; Friendship Bridge; BRI; FDI (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/978-981-99-1385-5_4

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