Bangladesh India Diplomatic Ties Reach New Heights

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The diplomatic relations between Bangladesh and India have reached new heights, as evidenced by the joint statement on September 30, 2023. The comprehensive agreements signed between the two nations cover a spectrum of areas, from defense and security to energy, trade, and connectivity. Prime Ministers Narendra Modi and Sheikh Hasina’s commitment to fostering mutual growth, security, and prosperity was underscored during this historic occasion. But this is not the only time when the epitome of bilateral relations came across the way. There were plenty of events took place in the year 2023 which demonstrate the solid partnership between the two nations. This marks a significant stride in the enduring collaboration between the two South Asian neighbors, reflecting a shared vision for regional stability and prosperity. The subsequent initiatives, ranging from cross-border rail links to energy projects and currency trading, highlight the multifaceted nature of their strengthened bilateral ties.

India emerged as the initial nation to officially recognize Bangladesh as an independent state, establishing diplomatic ties right after its liberation in December 1971. The connections between India and Bangladesh extend beyond mere political recognition, encompassing shared civilization, culture, societal bonds, and economic interests. The alignment of the two nations is evident in their intertwined history, common heritage, linguistic and cultural affinities, and shared enthusiasm for music, literature, and the arts. These shared elements serve as the foundation for their multidimensional and expanding relations. Geographically, India and Bangladesh find themselves in strategic proximity, providing a golden opportunity for the enhancement of connectivity links and economic collaboration. Regular high-level exchanges, visits, and meetings, coupled with extensive people-to-people interactions, further reinforce the bilateral ties. Landmark visits by Prime Minister Sheikh Hasina to India in January 2010 and  2022 and Prime Minister Manmohan Singh to Bangladesh in September 2011 marked a turning point in their relationship.

President Pranab Mukherjees visit in March 2013 underscored the utmost importance that India places on its association with Bangladesh, emphasizing principles of equality, partnership, and mutual growth. The diplomatic momentum was maintained with External Affairs Minister Smt. Sushma Swarajs and S. Jaishankars stand alone visit to Bangladesh in June 2014, further solidified the close and amicable rapport between the two nations. The pinnacle came when in 2021 the Indian Prime Minister Narendra Modi came to Bangladesh to take part in Bangladesh’s 50th Independence Day celebrations. Over the past four decades, political, economic, trade, and cultural relations have been consistently strengthened, supported by a comprehensive institutional framework fostering bilateral cooperation. Notably, the shared management of 54 rivers and collaborative efforts in conserving the Sunderbans ecosystem showcase the commitment to preserving common biodiversity heritage. Economic relations between Bangladesh and India have witnessed substantial progress, entering a new phase of collaboration. India’s diverse exports to Bangladesh, including cotton yarn, petroleum products, cereals, and cotton fabrics, reached a noteworthy $12.20 billion in fiscal year 2023. Conversely, imports from Bangladesh, comprising items like RMG cotton, cotton fabrics, man-made fibers, spices, and jute, amounted to $2.02 billion in the same period. The sustained growth in trade is evident, with exports and imports in April-May 2023 alone reaching $1.67 billion and $278 million, respectively. The implementation of the Comprehensive Economic Partnership Agreement (CEPA) is on the horizon, reflecting a shared commitment to further economic collaboration between the two nations.

Bangladesh and India are set to engage in Rupee-Taka trading, with bilateral transactions in Indian Rupees initiated from July 11th. This decision aims to reduce Bangladesh’s reliance on the US dollar, addressing the decline in foreign exchange reserves caused by the Russia-Ukraine conflict. As the countries face inflation and import cost challenges, the move is expected to ease strain on the USD and boost financial resilience. Key banks, including Sonali Bank Ltd, Eastern Bank Limited, State Bank of India, and ICICI Bank, have been authorized to facilitate trade transactions. This development holds broader significance, potentially inspiring regional common currency adoption in South Asia. The initiative, addressing currency scarcity, could serve as a model for nations dealing with similar economic ties and foreign exchange challenges, fostering efficiency and competitiveness in trade.

The inauguration of the 131.57-kilometer Indo-Bangla Friendship Pipeline marks a significant milestone in bilateral cooperation between Bangladesh and India. Opened on March 18, 2023, the pipeline facilitates the import of petroleum products, primarily diesel, from India to Bangladesh. With Prime Ministers Sheikh Hasina and Narendra Modi leading the inauguration, the pipeline, spanning 126.57 kilometers in Bangladesh and 5 kilometers in India, signifies enhanced energy collaboration. Initiated under a 15-year agreement, the project aims to import 250,000 to 400,000 tonnes of diesel annually. This cross-border pipeline not only ensures a stable diesel supply for Bangladesh but also presents economic benefits for both nations by reducing transportation costs and fostering environmental sustainability. The success of this project sets a precedent for future collaborations, offering a model for South Asian nations to enhance energy security and promote regional stability.

In January 2023, two Indian Coast Guard Ships, ICGS SHAURYA and ICGS RAJVEER, visited Chattogram for six days, reinforcing cooperation between the Coast Guards of Bangladesh and India in the maritime domain.

The recent two-day Shipping Secretary Level Meeting in Dhaka between Bangladesh and India, held on December 19, 2023, showcased significant strides in consolidating their enduring partnership. Discussions during the meeting included crucial dialogues on Inland Water Transit and trade and the reciprocal movement of goods through ports. Led by high-ranking officials, the talks addressed trade challenges and opportunities, with a focus on enhancing connectivity and resolving logistical issues. Recent agreements, notably the authorization for India’s commercial transport through Bangladeshi ports, underscore a joint commitment to bolster regional trade. In the context of a disrupted global supply chain, these strategic measures reflect a renewed collaboration for increased connectivity and trade resilience between the two nations. The diplomatic approaches and agreements reached during these discussions play a pivotal role in fostering a renewed paradigm of collaboration within the domain of connectivity and trade, contributing to the enhancement of regional trade and security.

These developments in Bangladesh-India relations showcase a robust and dynamic partnership that goes beyond traditional diplomatic engagements. The inauguration of cross-border projects, collaborative ventures in energy, trade, and connectivity, as well as joint efforts in defense, signal a shared commitment to mutual development. The bilateral ties have not only solidified but expanded, contributing to the overarching goal of regional stability and prosperity. As Bangladesh and India continue to deepen their collaboration, the ripple effects are expected to resonate across South Asia, setting a precedent for effective regional cooperation in the realms of trade, security, and connectivity. The enduring spirit of friendship and cooperation between these two nations stands as a beacon for other countries seeking to forge meaningful and mutually beneficial diplomatic relationships.

– Syed Raiyan Amir is a Research Associate at the KRF Center for Bangladesh and Global Affairs (CBGA).

Published in Daily Observer [Link] and Modern Diplomacy [Link]