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US-Bangladesh Partnership Dialogue: What Next?

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US-Bangladesh Partnership Dialogue: What Next?

The latest talks took a positive tone, but there were no breakthroughs on the major issues between Dhaka and Washington.

US-Bangladesh Partnership Dialogue: What Next?

U.S. Under Secretary of State Victoria Nuland (left) meets with Bangladesh’s Foreign Minister AK Abdul Momen, Mar. 20, 2022.

Credit: U.S. Embassy Dhaka

On March 20, Bangladesh hosted the eighth United States-Bangladesh Partnership Dialogue, the umbrella platform established in 2012 to elevate the “robust relationship” between Dhaka and Washington. The once-annual dialogue had been on hold since 2019 due to the COVID-19 pandemic.

This dialogue, which coincided with the celebration of 50 years of bilateral ties between Bangladesh and the United States, took place amid new complications. Bilaterally, ties between Dhaka and Washington have been strained since the U.S. sanctions against Bangladesh’s elite force Rapid Action Battalion (RAB) and its top officials and the decision not to invite Bangladesh to Biden’s democracy summit in late 2021. More recently, Dhaka’s abstention from the historic U.N. General Assembly vote on the Ukraine crisis on March 2 also highlighted divergent positions. More broadly, the dialogue was held against the backdrop of the invasion of Ukraine by “revanchist” Russia, the growing assertiveness of “revisionist” China, and the “decline” of the U.S.-led liberal order, which is fostering the creation of a new geostrategic environment in a rapidly changing world order.

On the surface, the dialogue seemed to produce a positive outlook, if not success. U.S. Under Secretary for Political Affairs Victoria Nuland – the third highest-ranking official in the U.S. State Department – led the U.S. delegation and termed the talks as an “appetizer for the feast,” implying more good things to come. Foreign Secretary Masud Bin Momen, who led the Bangladeshi delegation, likewise touted the dialogue as “the beginning of a rejuvenated robust engagement with our U.S. friends.”

The dialogue featured a “renewed, multi-faceted, and deepening” focus on the entire gamut of bilateral ties: trade, investment, labor, human rights, governance, global threats including climate change, terrorism, maritime security, regional issues including the “Free and Open Indo-Pacific,” and the Rohingya crisis. Like every bilateral dialogue, however, there are convergences and divergences between Dhaka and Washington and each side has its own priorities and national interests.

The U.S. delegation emphasized the priorities of the Biden administration – its Indo-Pacific Strategy (IPS) as well as renewed focus on democracy and human rights – in the discussions. Washington is also keen on convincing Bangladesh to sign two defense deals, the General Security of Military Information Agreement and Cross-Servicing Agreement, to “contain and rebalance” the growing Chinese footprint in Bangladesh. More importantly, the United States sought Bangladesh’s support on its side to end the war in Ukraine.

Conversely, Bangladesh expressed its deep concerns over two thorny issues: U.S. sanctions on RAB, which Dhaka wants lifted, and the 2013 suspension of Generalized System of Preference (GSP) facilities for Bangladesh, which Dhaka wants restored. Dhaka’s delegation also highlighted the enactment of the law on Election Commission formation as a step toward strengthening the democratic process in Bangladesh.

Notably, Bangladesh has demonstrated its interests in joining the “economic component” of the Biden administration’s IPS to fortify its economic development, pursue maritime cooperation, and counter climate change, terrorism, and organized crime. However, Dhaka has distanced itself from joining the Quad, which is widely seen in the region as an anti-China military alliance. Due to Bangladesh’s “strategic partnership” with China – its largest development, defense, and trade partner – it would be imprudent for Dhaka to anger Beijing. Bangladesh’s strategic ties with Beijing do not, however, lead to the assumption that Dhaka is abandoning the West and, in particular, the United States.

Instead, Bangladesh  has deftly balanced and kept itself shielded from the intensified geopolitical rivalries between and among great powers in South Asia. Bangladesh has “robust ties” with the United States, “blood ties” with U.S.-empowered partner India, “strategic ties” with U.S. arch-rival China, and “historic ties” with U.S. arch-foe Russia.

Though the U.S. delegation did not give any clear hint on whether the sanctions on the RAB and its top officials would be lifted anytime soon, nor any promise that the GSP would be reinstated, there are some clear signs of rapprochement from both sides. On Dhaka’s side, Bangladesh has started considering signing the “twin foundational deals” as a part of modernizing its armed forces by 2030 and diversifying its defense agreements. More importantly, Bangladesh has switched its stance on the Ukraine crisis by tilting toward the “right side of history” and criticized Russia by voting in favor of the March 24 U.N. General Assembly resolution denouncing the dire humanitarian situation in Ukraine and demanding access for aid workers and protection of civilians.

Alternatively, Washington, although belatedly, has also opted for the “right side of the history” by referring to the atrocities committed against the Rohingya people in Myanmar as “genocide,” which will certainly inject new momentum into Bangladesh-U.S. ties. Bangladesh has been shouldering the burden of hosting 1.1 million Rohingya refugees since the infamous “clearance operation” of Myanmar’s armed forces in 2017.

Needless to say, Dhaka perceives Washington as a proven and trusted development partner. Bangladesh is the third-highest recipient of U.S. aid in South Asia after Afghanistan and Pakistan and the two-way trade reached $9 billion in 2019, with Bangladesh becoming the 46th largest U.S. trading partner. In addition, the United States is the single largest export destination for ready-made garments (RMG), accounting for 83 percent of Bangladesh’s total exports. Conversely, Bangladesh ranks as the second-largest apparel exporter to the United States, trailing only China.

The U.S. also was the largest source of Foreign Direct Investment (FDI) to Bangladesh, with $3.5 billion in cumulative investments as of 2019. As Dhaka’s appetite for investment, energy resources, and skilled labor grows, a robust partnership with the United States is pivotal for Bangladesh’s economic growth to materialize its “Vision-2041,” particularly after graduating from Least Developed Country status (expected in 2026).

As South Asia is experiencing intensified rivalries between China and India, as well as China and the U.S., Bangladesh deserves attention in its own right on the Indo-Pacific chessboard, not just through the subset of “South Asian policy” or the “Indian prism,” which has been the case for decades. Bangladesh, the current chair of the Indian Ocean Rim Association (IORA), has unfettered access to the Bay of Bengal, a geostrategic region that bridges South and Southeast Asia, a burgeoning economy, and huge market potential. Sitting at the critical juncture of 50 years of Bangladesh-U.S. ties, the White House should, therefore, take into account Dhaka’s strategic imperatives as it is engaged in a delicate balancing act between India and China in the South Asian region. If fully understood, this will set forth the “rejuvenation of Bangladesh-U.S. ties” in the coming days amid this “multiplex” world order.