PM Hasina's China tour: A positive step forward

From up left Humayun Kabir, Mohammad Hatem, Touhid Hossain, Mahbubul Alam. Sketches: TBS

Prime Minister Sheikh Hasina returned home in the early hours of Thursday after concluding her three-day bilateral visit to Beijing. During the visit, Chinese Prime Minister Li Qiang announced one billion yuan in economic assistance for Bangladesh, while 21 instruments were signed, and seven new projects were announced.

The Business Standard reached out to former diplomats and business leaders to gauge the outcomes of the visit.

'Many positive takeaways from the tour'

Humayun Kabir, Former Ambassador

Before our Prime Minister's departure to China, there were high expectations in the media. However, the Chinese Prime Minister's announcement of 1 billion yuan (approximately $137m) in economic assistance for Bangladesh fell short of these expectations.

Nevertheless, there have been some noteworthy agreements that deserve attention.

Firstly, both countries will begin working on a Free Trade Agreement (FTA), a significant development that can be seen as a positive sign. Several projects were also announced to elevate the Bangladesh-China relationship from a "strategic partnership" to a "comprehensive strategic cooperative partnership." This indicates that China is willing to expand and deepen its relationship with Bangladesh, which bodes well for the future.

China also expressed its support for continuing the zero-tariff treatment on 98% of taxable items for Bangladesh beyond 2026, when Bangladesh graduates from its LDC status. Then there is the possibility of Chinese banks opening branches in Bangladesh and vice versa, which could provide us further exposure to the international environment.

There hasn't been much discussion regarding the BRICS issue this time, even though China welcomed us. On the Rohingya issue, China stated it would continue to provide support.

So, while the economic expectations couldn't be realised, there are many positive takeaways from this tour, and continued efforts from Bangladesh could yield more results in the future.

Meanwhile, it appears that there was no discussion regarding the Teesta issue during this tour, or if there was, it has not been revealed. However, the Teesta issue likely did not impact the relationship with China. It is just one project among many.

Bangladesh needs both India and China, and we are well aware of the fact that China is more powerful and resourceful. Therefore, it is unlikely that China will be overly concerned about Bangladesh's diplomatic and economic relationship with India.

Humayun Kabir spoke to TBS' Jannatul Naym Pieal over the phone.

'We need to sign an FTA with China as soon as possible'

Mohammad Hatem/ Executive President, BKMEA

I think this visit will have a significant impact on our economy as our relationship with China has been strengthened. This tour will also help take the business relationship between the two countries further. Already a high-power business delegation is here in Bangladesh. We have had meetings with them, they are discussing trade-related issues with the Chinese government.

In future, I think our trade with China will increase – especially exports to China will increase thanks to this trip I believe. Chinese investors are also interested in investing here. All we need to do is solve the internal issues. If they hear there are customs-related issues here, there is a shortage of gas and electricity they will shy away from investing here. We need to fix these issues.

We lag behind in textile sectors like woven fabrics and man-made fibre while China is very strong in these sectors. If they provide us with the latest technologies we can benefit a lot from that collaboration.

We need to sign an FTA with China as soon as possible otherwise after LDC graduation we will be in trouble. The government must give this issue the utmost importance. In fact, we also need to sign FTAs with other major trade partners like the EU.

If we can attract Chinese investors, our industries especially the textile industry will benefit immensely. The MoUs signed during the trip will help this cause.

The agreement to increase the use of local currency in bilateral trade is a welcome one. But to get the most out of this agreement we must try to shorten the trade gap and export more goods to China. Then if we have Chinese Yuan in hand, we can use it to settle payments with China instead of Dollar

Mohammad Hatem spoke to TBS' Nasif Tanjim over the phone.

'Our bigger concern should be the clarification of four types of aid'

Md Touhid Hossain, Former Foreign Secretary

There were many expectations from the visit. Again, from a practical standpoint, there wasn't much to expect.

A significant issue is the Teesta project. Our Foreign Minister made it clear that we would choose India over China regarding Teesta. However, we had previously proposed the project to China, and they had made good progress with it. This might have a negative impact, as China may be somewhat dissatisfied with our decision.

That said, the Chinese are pragmatic people. They understand that Bangladesh would never do something to irate India. Regarding the Teesta project, India had expressed concerns about the security of having Chinese workers so close to their country for a long period.

Ultimately, self-interest is paramount in international relations. Even without the Teesta project, China has many other projects with Bangladesh that serve their interests, so they will proceed with them.

What our bigger concern should be is the clarification of four types of aid. We don't yet know the proportions of commercial loans, concessional loans and interest-free loans, but I doubt they will be anything substantial. Even if we receive $200 million, it's a small amount compared to the current size of our economy and needs. Any aid, not over $1 billion is not very significant.

What we need now is a big amount of concessional loans, something we haven't received from China. If we could secure a large amount of interest-free loans, that too would be a substantial gain from the visit. For now, 1 billion yuan (approximately $137 million) aid seems like a drop in the ocean of our massive economic needs.

Md Touhid Hossain spoke to TBS' Kamran Siddiqui and Jannatul Naym Pieal over the phone.

'Chinese investors are keen to come and promised to invest more soon'

Mahbub Alam/ President, FBCCI

We have had very fruitful bilateral talks. Those of us from the business community who went have had meetings with a huge number of Chinese investors. We had meetings with our Chinese counterparts such as the China Council for the Promotion of International Trade (CCPIT) and the China Chamber of International Commerce (CCOIC).

They think very highly of Bangladesh. The Chinese investors are keen to come and invest here. We told them the amount you currently invest is not enough for the economy your size and they promised they will soon invest more. We assured them Bangladesh offers a conducive environment for investment and FBCCI will provide all kinds of support to the Chinese investors to facilitate their business in Bangladesh.

I also stressed the potential for future collaborations with the CCPIT and CCOIC in several sectors, including Information Technology, garments, textiles, light engineering and joint research initiatives to explore market opportunities.

The agreement to increase the use of local currency in bilateral trade will really help us lessen the dollar demand. Chinese banks are also considering entering the Bangladeshi market.

Mahbub Alam spoke to TBS' Nasif Tanjim over the phone.