In a highly important regional development, Chinese President Xi Jinping has signed loans and investment deals with Bangladesh worth about $20 billion with a view to increasing Beijing's influence in a country closed to rival regional power India.
China will fund key infrastructure projects such as roads and railways as well as new industrial park, totalled around $20 billion. Bangladesh and China have also identified other projects, whose total loans and investment will surpass $50 billion.
There is hardly any doubt about the fact that Beijing has responded to New Delhi's growing diplomatic belligerence in an effective and meaningful manner. It has made a strong attempt aimed at wooing India's key ally Bangladesh with massive injections of investments. Although, Bangladesh is in India's sphere of influence, the Chinese move would certainly force Dhaka to strike a delicate balance between its policy approaches to Beijing and New Delhi.
Bangladesh needs tens of billions of dollars of investment in its transport infrastructure and energy production to boost its flagging economic fortunes and create jobs for its 160 million people. It is only Beijing that can help Dhaka deal with its myriad economic challenges.
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