After the fall of the Sheikh Hasina regime in August, Bangladesh, chose to adopt a confrontational stance towards India, and started gravitating more towards New Delhi’s rivals, Pakistan and China. But the country is now on the brink of an economic and social meltdown as radical elements seem to be running the show.
Bangladesh, which shares 94 percent of its border with India, is highly dependent on its larger neighbour, especially from an economic and security point of view. Bangladesh’s 4,367 km long border makes it dependent on India for security and trade, with New Delhi being Dhaka’s biggest trading partner.
In 2022-23, the total trade between India and Bangladesh was $16 billion, in which the latter’s exports to the former only accounted for around $2 billion, meaning Dhaka has massive trade deficit with New Delhi. Bangladesh imports key products and essentials such as cotton, food grains, sugar, electronics, and steel, among others from India, and halting of trade would undoubtedly cripple Dhaka’s economy.
Bangladesh’s textile industry, which is the backbone of the country’s economy, contributing 11 percent to its GDP, is also dependent on India. According to reports, India exports 35 percent of its total cotton produce to Bangladesh, and the country’s textile industry will be badly hit if these imports are stopped.
As per reports, Bangladesh has suffered a loss of Rs 2 lakh crore since the fall of Sheikh Hasina in August, due to which the country’s which the GDP growth rate has dropped to under 5 percent, from the earlier 6.3 percent. Additionally, a rapid decline has been witnessed in per capita income and soaring inflation has worsened the situation.
Bangladesh’s textile industry is also facing heavy losses and many companies are on the brink shutting their operations due to the deteriorating law and order situation, and the increasing violence against minorities, especially the Hindus, in the country. Bangladesh’s textile industry is the second largest in the world after China, with many top global brands manufacturing their apparel in the country.
Notably, it was earlier reported that Bangladesh was planning to import large quantities of sugar from Pakistan, a clear snub to New Delhi, as India is one of Bangladesh’s largest importers. Bangladesh’s interim government, which recently called off the bandwidth transit agreement with India, was also considering to cut imports of potatoes and onions from India, and mulling other sources for these staples, the reports said.
India-Bangladesh relations
India-Bangladesh relations have slumped after the ouster of former Prime Minister Sheikh Hasina, and an interim government led by Nobel laureate Muhammad Yunus, coming to the helm in Dhaka.
Bangladesh has witnessed widespread communal violence against minorities, especially Hindus, which has soured Dhaka’s ties with New Delhi, with the latter accusing the Yunus-led interim government of not doing enough, and turning a blind eye to the atrocities perpetrated by radical Islamist elements against the minority Hindu community in the country.
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