How Bangladesh can gain from China-led new global trade realignment
Moscow frames it as cooperation for development, while Western capitals warn of a new axis capable of unsettling the US-led global trade order. For Bangladesh, whose economic lifeline flows both to the West and across Asia and other continents as well, this shifting landscape poses more opportunities than risks
Highlights:
- China, Russia, India align against US tariff pressures
- Bangladesh exports rely on US; imports depend on Asia
- High US tariffs spur closer China-Russia-India cooperation
- SCO summit showcased unity, energy deals, alternative trade links
- Bangladesh faces dilemma: US markets vs Asian supply chains
- Dhaka's priority: balance relations, diversify trade, ensure resilience
The world is witnessing a quiet rearrangement of power. China, Russia and India – three nations with long histories of rivalry and mistrust – are edging closer in what some see as the makings of an alliance to counter the shocks from US President Donald Trump's sweeping tariff.
Moscow frames it as cooperation for development, while Western capitals warn of a new axis capable of unsettling the US-led global trade order. For Bangladesh, whose economic lifeline flows both to the West and across Asia and other continents as well, this shifting landscape poses more opportunities than risks.
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Bangladesh's double dependency: America buys, Asia sells
Bangladesh's trade map tells a story of dependence split between two worlds. On the export side, the US reigns supreme as the single largest destination: in FY24, Dhaka shipped $7.6 billion worth of goods to American markets – more than 17% of all exports – while China, India and Russia together absorbed barely 6%. This overwhelming reliance means that the lifeblood of Bangladesh's garment factories still flows westward, and any rupture with US buyers could shake the economy at its core.
Yet turn to inputs and the picture flips. China towers over the landscape, supplying $16.6 billion in goods (26.4% of all imports), followed by India with $9 billion (14.3%). The US is relegated to the sixth place at just 4%, and Russia sits 18th as an import source for Bangladesh. From textile inputs to energy and raw materials, Bangladesh's supply chain is already tethered to Asia.
For countries like Bangladesh, this shifting landscape brings both dependence and dilemmas. Its industrial raw materials arrive from China and India, its only nuclear power plant relies on Russia for funding, technology, uranium, and waste disposal.
The asymmetry also gives Dhaka a strategic advantage. With strong Asian supply chains and robust Western markets, Bangladesh is uniquely positioned to leverage both spheres. In an era where Washington adjusts tariffs, Beijing extends credit, and Moscow seeks partners, Dhaka has the flexibility to strengthen ties on multiple fronts.
The challenge becomes an opportunity: by carefully balancing relationships. Bangladesh can secure essential inputs, expand market access, and enhance economic resilience, turning what might seem like a delicate position into a platform for growth and diversified engagement.
What China-Russia-India initiative offers
The global economic order is undergoing a seismic shift as emerging powers forge new alliances to counter US-led dominance. At the heart of this transformation lies the China-Russia-India (CRI) energy and trade triangle – an alliance leveraging collective weight to reshape global markets and investment flows.
To the West, China distorts trade by subsidising state enterprises that keep its exports cheap and abundant. Yet, in the wake of Trump's unilateral tariffs, Beijing positions itself as a saviour of global trade, championing multilateralism at a time when Washington seems to undermine it.
US sanctions have accelerated this realignment. Russia, forced to sell oil at discounted rates after Western rejection following its Ukraine invasion, found ready buyers in China and India. For Beijing and New Delhi, cheap oil is an economic boon; for Moscow, it is a vital lifeline – mutual dependence drawing them closer together.
The US tariff hostility has brought them closer than before. Xi pledged to create a "more just and equitable" global system. Modi made his first trip in seven years as he was willing to balance relations with China
Trump argues this fuels Russia's war machine, but similar logic could apply to Israel, whose exports support its war and massacre in Palestine. Despite new US tariffs rattling the world, Israel still enjoys softer treatment with 15% like major US allies.
How tariff hostility, oil drew them closer
Trump's sweeping tariffs – from baseline 10% to 50% on countries, even up to 145% on Chinese goods – could slash the purchasing power of Americans by 4% and cost each household extra $1,300 annually. They could be more disastrous for the world, which might see a significant decline in trade and economic growth, with developing economies taking most of the blow.
At this crossroads amid Trump's renewed tariff threats, China stepped in, with Russia and India at its side, at the recent Shanghai Cooperation Organisation (SCO) summit in China. India's Narendra Modi had skipped the SCO summit last year, but this year, with 50% US tariff imposed, Modi shared the dais with Xi Jinping and Russian president Vladimir Putin, along with other members, creating hopes that the new grouping might partially mitigate tariff fallout via alternative trade links.
The US tariff hostility has brought them closer than before. Xi pledged to create a "more just and equitable" global system. Modi made his first trip in seven years as he was willing to balance relations with China.
US appeals court has ruled against Trump's tariff policy, but it still remains in force. Trump even urged European Union officials last week to hit China with 100% tariff and similarly expansive tariff on Indian goods, according to Reuters.
After the SCO summit, Xi used a military parade in Beijing early this month to show China's military might post-World War II. He identifies the USA as today's source of trouble. Though China is still far from leading an alternative trade system right now and not all major players might agree to see China on the steering, the new grouping throws some weight on geopolitical and trade issues, and offers some hopes for smaller economies.
For Russia's Vladimir Putin, the SCO summit was a rare show of solidarity with his country's top oil buyers – China and India. Founded in 2001, the SCO now spans 10 countries representing 23% of global GDP and 43% of the world's population – underscoring the rise of multipolar trade frameworks challenging US primacy.
India and China benefited from Russian oil, which lost market and price after Western sanction following the Ukraine war in 2022. Russia offered China to supply LNG through a pipeline, which will reduce China's gas imports from the USA, Australia and Qatar.
But this angered Trump, who slapped India with a high tariff rate, while tariff negotiation with China is still going on. With no new tariff, Moscow is still under US-led western trade sanctions that squeezed its market and made its dollar-based international transactions difficult. Beijing's push for an alternative multilateralism and deeper ties with Moscow and New Delhi has come amid US tariff hostility.
Their trilateral trade crossed $450 billion in 2023, up from $350 billion a year before.
For Dhaka, the priority is balance
The new triangular alignment opens opportunities in energy, technology, and infrastructure among its key partners and also for smaller economies like Bangladesh navigating rival trade blocs.
The China-Russia-India strategic triangle offers both scope and risk for global trade and investment. Deeper integration is already visible: India's investment in Russia's oil and gas sector more than doubled to $16 billion in 2023, while Russian investment in India's energy infrastructure reached $20 billion. Moscow and Beijing are also advancing talks on a new gas pipeline – a significant step as Russia's supply lines to Europe remain uncertain.
For countries like Bangladesh, this shifting landscape brings both dependence and dilemmas. Its industrial raw materials arrive from China and India, its only nuclear power plant relies on Russia for funding, technology, uranium, and waste disposal.
At the same time, Bangladesh needs US market access to sustain its exports. Though lowered from what initially was threatened, Bangladesh still faces a steep 20% tariff in the US – in contrast to duty-free access in Europe, Japan, and Australia. Dhaka has agreed to purchase American cotton, wheat, gas, soybean oil, and even aircraft in hopes of easing trade pressure. The first government-to-government wheat shipment is already en route to Chattogram Port.
Financial partnerships are equally vital. Bangladesh leans on the IMF, World Bank, and ADB, but also seeks favourable support from China's New Development Bank. It cannot afford to ignore the WTO, which continues to set the rules of global trade, nor can it risk being caught between rival trade blocs. For Dhaka, the priority is balance – building win-win ties with all partners. Encouragingly, the emerging triangle may even narrow rifts between India and Pakistan, which aligns with Bangladesh's recent moves to improve its own relations with Islamabad.
