How US’ shifting geopolitical priorities will affect Bangladesh

Illustration: TBS

For a long time, everyone was of the opinion that the US wanted to be an ally of India to counter the influence of China in the South Asian region, and that its relations with Pakistan would not ease. 

Antithetical to what was perceived as a fact, a different geopolitical scenario is unravelling now.

India's Ministry of External Affairs recently issued a statement in support of oil imports from Russia. In retaliation, Trump imposed a total tariff of 50% on its exports to the US market, sending shockwaves across the region and upending the geopolitical scene.

In addition, Trump is also making further reforms in his anti-China strategy in South Asia. Like Pakistan, the US does not want to keep Myanmar, another country close to China, at a distance like before. As a result, there is huge speculation that this recent rift between the US and India might bring the latter closer to China.

As the geopolitical alignment is changing, Bangladesh, as a developing country, must also keep tabs on what is happening in the region and try to make the most out of these changed realities. There is a strong possibility that China's influence will rise in this region if the situation does not let up in the coming days.

Nothing is predictable as far as Trump's policy is concerned. Despite the changing geopolitical situation, Bangladesh should think about integrating itself into a regional bloc like RCEP, which could create a lot of business and investment opportunities for us.

Abdur Razzaque, Chairman, Research and Policy Integration for Development

With prospects of India and China getting closer to forging a greater unity, Bangladesh must carefully observe the developments and take the evolving geopolitical realities into account.

Obaidul Haque, a faculty member at the International Relations Department of Dhaka University, said, "It was thought earlier that India is Trump's only friend [geopolitically] in this region to counter China. But Trump's calculation is different. Under such circumstances, a new geopolitical alignment will be created. The whole situation is in flux; it has not taken any shape yet. In the coming days, this geopolitical situation will take shape, and many things will depend on that."

He went on to say, "But it does not mean that Bangladesh should sit idle; rather, the country should take these things into cognisance and opt for multi-faceted preparations including geopolitical, trade and political strategy."

Asked whether Bangladesh could capitalise on the situation, Obaidul opined, "Because of the changing geopolitical shift, a prospect for Bangladesh has been created. India wants to face the tariff imposed by the Trump administration; at least, this is what we can assume from Indian politicians' statements. India is right now doing a cost-benefit analysis seriously. So, India is not going to give in to Trump's geopolitical policy.

"There are other geopolitical calculations here as well. In that case, prospects for our country have emerged, but this prospect is not automatic. We have to see whether Bangladesh has the capability to tap into the opportunities that will be created in the coming days," added Obaidul.

Against such a backdrop, Bangladesh must get back to the drawing board and map out a detailed strategy, taking every nook and cranny of the evolving situation into account. For Bangladesh, it is time to reconsider how it can benefit from joining a regional trade bloc like Regional Comprehensive Economic Partnership (RCEP).

If the stalemate continues and India develops an affinity with China, there is a possibility that India might join RCEP, which they can do at any time as a founding member. In that case, RCEP will definitely turn into a very powerful regional trade coalition as the member countries of the RCEP are already poised to become the centres of the global economy.

"Nothing is predictable as far as Trump's policy is concerned. Despite the changing geopolitical situation, the country should think about integrating itself into the regional bloc like RCEP, which could create a lot of business and investment opportunities for us," said Abdur Razzaque, Chairman of Research and Policy Integration for Development (RAPID).

He added, "Countries included in the RCEP are dynamic, so Bangladesh could experience business growth by joining RCEP. If we could improve our business environment and offer opportunities to the member countries, it might spur investments in our country."

Data also supports the RAPID chairman's optimism.

RCEP is made up of 15 member countries that account for a combined market worth $26.3 trillion.

According to different feasibility studies conducted from time to time, if Bangladesh joins RCEP, it is expected to enhance our export volume by an estimated $5 billion, while the country could experience an increase of $3.26 billion in exports and $3.36 billion in foreign investment. Overall, RCEP membership could boost Bangladesh's GDP by around 0.26%, as estimated by experts.

However, there are risk factors associated with this move as well.

Obaidul Haque added, "Bangladesh needs to think independently and seriously about regional trade blocs like RCEP and BRICS. There are some challenges for the country in this connection; it is not possible to be a member of RCEP all of a sudden. We need a comprehensive and coordinated study mapping out the benefits and risks of joining trade blocs like RCEP and then deciding accordingly."

RAPID chairman Abdur Razzaque further explains the challenges. 

"There are risks as well. If Bangladesh joins RCEP, the member countries would also expect us to open our market to them. If you keep high tariffs, those RCEP countries will not negotiate with us. They will try to negotiate terms in their favour.

"Secondly, a significant amount of government revenue — almost 27% — comes from tariffs on international trade. If we do not revise tariffs, other countries will not enter into any trade agreement with us. So, are we ready for that?" Razzaque further said.

There are both pros and cons of joining RCEP. Most importantly, it is a time-consuming affair as Bangladesh will have to negotiate separately with the 15 member countries — a process that could take two to three years — to get membership. With the geographical alignment rolling in favour of Asian unity, Bangladesh must revisit its strategy and plan accordingly to reap the highest benefits.