The interim government led by Muhammad Yunus in Bangladesh is reviewing its India-centric policies espoused by former Prime Minister Sheikh Hasina and improving ties with Pakistan which has caused unease in India. However, Yunus understands India’s indispensability for Bangladesh. In the words of Yunus, Bangladesh will adopt an approach of “fairness and equality” in dealing with India which has put to rest the speculation of his anti-India stance however, the level of partnership will not reach the same level as under Sheikh Hasina in the near future in an atmosphere of mistrust between the two nations.
India faces new challenges in its relationship with Bangladesh: The departure of Sheikh Hasina from power in Bangladesh may have irked India as her government was taking the best care of India’s concerns from the point of security, and agreements on contentious issues to combating homegrown radicalization and maintaining a distance from India’s bete noire Pakistan. Under her regime, Bangladesh was a staunch ally of India in South Asia. However, this scenario changed overnight as she fled to India after massive student-led protests on August 5.
Now there is a reversal Muhammad Yunus who is the new leader is trying to free Bangladesh from the influence of India. For this, he is deepening Bangladesh’s ties with Pakistan in every domain from trade and commerce to Defence. Bangladesh is Potentially looking at ways to strengthen defence cooperation with Pakistan as is evident from its decision to seek a new supply of artillery ammunition from Pakistan. Also, they have revived a direct maritime link with Pakistan after 50 years. These attempts at sidelining India and sending feelers to Pakistan are alienating India. Also, Bangladesh is seeking to strengthen further its defence ties with China, which is also its largest trading partner. After failing to secure a deal for F-16 fighter jets from the United States, Dhaka is now negotiating a significant defense deal with China to purchase 16 J-10C multirole fighter jets, along with attack helicopters. These events have raised an alarm in India which fully understands that Bangladesh may be another Chinese proxy to encircle India which has been the policy of China.
India has learned its lessons from its South Asian experience of Afghanistan and Maldives that favourable governments may not be permanent but relations must continue with those in power.
Both India and Bangladesh are promoting dialogue and cooperation to address mutual challenges with bilateral visits of top officials. India’s Foreign Secretary Vikram Misri met with Muhammad Yunus on December 9 giving strength to work on improving bilateral ties.
Despite several differences, the two countries look forward to cooperation in the areas of connectivity, trade, power, energy, and capacity building.
India’s many agreements with the Hasina regime under review: Bangladesh has signed several agreements with India under the premiership of Sheikh Hasina which include transit, trans-shipment, and train connectivity with Delhi which Dhaka considers inimical to its sovereignty in present circumstances. These may be under the review of the new government in Bangladesh.
The media reports from Bangladesh cite that the government may be in the process of reviewing all the MoUs with India and may cancel any MoU found to be non-beneficial to the country.
Also, many ongoing projects funded by the Indian Line of Credits (LoCs) are under scrutiny. India had promised Bangladesh loans totalling $7.36 billion across three LoCs in 2010, 2016, and 2017.
Under the LoCs, a total of 36 projects in the areas of road and rail connectivity, energy, and infrastructure have been undertaken. So far 15 projects have been completed, 8 are ongoing while the rest are under the process of consultant and contractor appointments or proposal preparation.
Also, an Indian credit-funded project to upgrade approximately 50 kilometers of road from Ashuganj in Brahmanbaria to the Akhaura border has been suspended.
Meanwhile, the new government has indicated that it wants to restart dialogue with India on the Teesta water-sharing treaty but given the present scenario, it is expected that it will not be as flexible as the Hasina regime.
Also Bangladesh’s Foreign Advisor Md. Touhid Hossain has accused India of alleged border killings of Bangladeshis trying to cross the border illegally. He further eyes balanced geopolitical partnership which he feels was tilted towards India under Sheikh Hasina. These issues may cause turmoil in the relations between the two countries.
Transitional government’s demand for extradition of Sheikh Hasina: Recently Bangladesh government has formally asked for India’s assistance in extraditing Sheikh Hasina. Indian government despite receiving the request has not officially commented on it which highlights India’s reluctance in handing over Hasina to Bangladesh.
Under the present situation, India may not extradite Hasina despite pressure from Bangladesh. Interestingly it was the Sheikh Hasina government which signed an extradition treaty with India in 2013. Now Bangladesh is seeking extradition under the same treaty. But India can exercise one of the caveats in the treaty which suggests that extradition may be refused if the offence is of a “political nature” or if the accusation is not made in “good faith” in the “interest of justice.
Despite other charges that Hasina faces including murder, enforced disappearance, and torture which are excluded from the definition of political crimes in the treaty India can give it a political undertone to protect her from extradition.
In fact there is precedence where India has denied extradition to Bangladesh especially in the case of Writer Taslima Nasreen who has been living in exile since 1994 in India.
Apart from India’s close bonding with Sheikh Hasina there is a pragmatic vision in India’s thinking to deny Bangladesh her extradition envisioning history may repeat itself.
In 2008 she was facing a similar situation of extradition from the USA for corruption and abuse of power by the interim caretaker government of Bangladesh (which was in power from 2007 to 2008). The then government initiated the cases against her but they were dismissed or considered politically motivated by the Bangladesh High Court. Hasina returned to Dhaka in April 2008 and in the elections later that year her party Awami League won the elections to return to power in 2009.
India remains indispensable for Bangladesh: Despite India having a trade surplus of $9.2 billion with Bangladesh in the financial year 2024, there are huge possibility of bilateral trade. The volume of total bilateral trade was reported at USD 14.01 billion in the financial year 2023-24. Bangladesh is India’s biggest trade partner in South Asia.
India and Bangladesh have huge potential for bilateral trade which can further get a boost with Comprehensive Economic Partnership Agreement (CEPA). This will help Bangladesh to immensely access the growing Indian market. It will also ramp up its exports and investment in India despite the loss in tariff revenue. Amid the interim Bangladesh government’s dillydallying approach to robust relations with India, such agreements are in their best interest which they would like to negotiate in the future. Also, through the Bay of Bengal Northeast Industrial Value Chain Concept, the two nations can boost their bilateral trade.
India and Bangladesh are looking at ways to enhance maritime security in the Bay of Bengal and also South-South cooperation for the betterment of developing nations. Also, India could be an important transit point for Bangladesh to access markets in South Asia, Southeast Asia, and beyond. Bangladesh-Bhutan-India-Nepal (BBIN) Initiative can boost regional connectivity which will benefit all the participating nations including Bangladesh.
Yunus very well understands the economic importance of India for Bangladesh which makes it very unlikely for him to take an anti-India stance but he may weigh his options for taking steps to further pursue the interest of Bangladesh including finding ways to reduce the trade deficit gap with India.
Radicalization of Bangladesh: India is closely watching the situation in Bangladesh even taking the issue of protection of minorities in the country, especially Hindus. Nearly 650 people were killed many among them Hindus during the student-led protest for the ouster of Sheikh Hasina.
Also, other major political parties such as the Bangladesh Nationalist Party (BNP) headed by Begum Khaleda Zia have a hardline position against India. The BNP and its ally Jamaat which wants an Islamist Bangladesh have forged an alliance to keep the Sheikh Hasina party away from power whenever elections are held in Bangladesh either in the last of 2025 or early 2026.
There are the major terror outfits in Bangladesh having an anti-India stand including Harkat-ul-Jihad-al-Islami Bangladesh (HuJI-B), Jamaat-ul-Mujahideen Bangladesh (JMB), Ansarullah Bangla Team (ABT), Lashkar-e-Taiba (LeT) Affiliates in Bangladesh and Islamic State (IS) Affiliates. If these terror outfits succeed in fomenting trouble in India then it may cause friction between the two countries having long-term implications.