Bangladesh Must Tap Asia’s Economic Opportunities: Sobhan

Centre for Policy Dialogue (CPD) Chairman Prof Rehman Sobhan has urged Bangladesh to respond to the changing global economic order by putting its economic interests first and strengthening its value-chain links with Asia.

Speaking at the opening session of the three-day Bay of Bengal Conversation at a Dhaka hotel on Saturday, he said Bangladesh’s relatively small role in the global system gave the country some flexibility in pursuing its economic interests.

“Our interest lies in a stable world order where external factors will not frustrate our economic opportunities,” he said.

Sobhan said Bangladesh remained dependent on a narrow range of export markets, while many of its major import sources and increasingly its sources of capital were in Asia.

He said Bangladesh had a major strategic advantage because of its location between China and India, two of Asia’s largest economies.

“In another decade or so, China will be the largest economy. India will be the third largest economy. We have not fully exploited this opportunity,” he said.

Although Bangladesh has integrated parts of its manufacturing process into the value chains of China and India, it has not done enough to connect its exports with their expanding markets, he said.

Sobhan identified strategic planning and implementation capacity as major weaknesses.

“There are many ideas on paper for economic diversification of our linkages, but in terms of thought processes and implementation capacities, they have remained weak,” he said.

He said Bangladesh’s key strategic advantage lay in its economic location, particularly its land connectivity, rather than its position on the Bay of Bengal alone.

“The real central position of Bangladesh lies in its strategic economic location, and it is not in the Bay of Bengal that that location is important. It is really in our land areas,” he said.

He said the Padma and Jamuna bridges were helping strengthen land links between Southeast Asia, South Asia, West Asia and eventually Europe.

Recalling the Bangladesh-China-India-Myanmar (BCIM) initiative, Sobhan said the project had been designed to promote such regional connectivity.

“I was one of the founders of the BCIM, and we know how we actually worked on this,” he said.

Sobhan said relations between India and China would be one of the key factors shaping Asia’s future.

He noted that despite political differences, China remained one of India’s major trading partners and that their economic relationship remained significant.

Stronger India-China ties could create opportunities for Bangladesh to play a greater role in the emerging regional economic order, he said.

“China-India partnership in the global system will create, in perpetuity, the possibilities of a more balanced order,” Sobhan said.

He added that stronger regional cooperation could help Asian countries use their markets, technology and resources to build a more balanced and equitable global economic system.

The changing balance of global economic power has triggered destabilising responses from traditional dominant powers, creating uncertainty for less powerful countries such as Bangladesh, he said.

Bangladesh’s policymakers should therefore explore creative strategies to build economic resilience and reposition the country in the changing global economic landscape, Sobhan said.

He also noted that economic power and influence were increasingly shifting towards Asia.

Growing competitiveness among Asian economies, particularly in manufacturing, has generated large economic surpluses and created alternative sources of aid, foreign investment and capital for developing countries.