China, Pakistan, Bangladesh and Sri Lanka are all close neighbors in the region. All four share common regional ties both in terms of geographic proximity, development pathways and through more recent ties through membership in regional trading blocs.
Sri Lanka differs in that it is an island economy and has used it to develop and redevelop its maritime facilities in international trade and commerce. Long known even to the ancient Greeks as a maritime hub in Southeast Asia, its redevelopment, with financial assistance from China via the Belt and Road Initiative (BRI) of its port of Colombo on the west coast, is on the point of accelerating the resetting of regional maritime trade capacities. To the east, its port, airport and Hambantota Free Trade Zone are starting to attract customers looking to serve East Asia and to ASEAN, China and ultimately the CPTPP. Sri Lanka, which previously looked west towards India, the Gulf and East Africa, now has a double face facing east. With its northern port of Jaffna due to be renovated and developed later in the decade, Sri Lanka will ultimately find itself with ports serving the Bay of Bengal to the north with possible subsequent passage to Central Asia.
Bangladesh also joined the Belt and Road Initiative in 2017 and its location in the Bay of Bengal occupies a strategic position in South East and South Asia. It shares borders with ASEAN and India, has free trade agreements with many ASEAN countries, China, India, Pakistan and Sri Lanka and uses these geographic and trade advantages . Bangladesh is moving forward. It will be the next South Asian miracle.
Access to Central Asia
At present, Pakistan is the only South Asian country showing its large-scale strategic importance to the region at this time. Its foreign policy has shifted towards geo-economy rather than geo-strategy. The China-Pakistan Economic Corridor (CPEC) and Gwadar Port have added enormous additional regional value in this regard in terms of infrastructure and capacity, the importance of which is still poorly understood. However, what the CPEC is doing is connecting the Western Xinjiang Province of China to the Persian Gulf in addition to providing access to Central Asia. Some of the connectivity has yet to be completed, but this will happen within the next two years. If the situation in Afghanistan improves, it will further stimulate the use of Pakistan’s infrastructure.
It is relevant to understand that Bangladesh, Pakistan and Sri Lanka are all active participants in China’s Belt and Road Initiative. The ports of Hambantota and Colombo in Sri Lanka are considered the epicenters of the Chinese BRI in South Asia. Sri Lankan ports can be used as a regional maritime hub between South Asia, Southeast Asia, Central Asia, Middle East and East Africa. This in turn provides an additional important connectivity route through the China-Pakistan Economic Corridor from Gwadar in Pakistan to Central Asia and Central and Western China.
Sri Lanka and Pakistan therefore have the opportunity to increase their maritime capabilities and work together in the areas of maritime trade, investment, science and technology and culture by enhancing these connectivity opportunities. Sri Lanka has concluded an FTA with Pakistan and is currently negotiating an FTA with China. It also has an FTA with Singapore. However, given the development of maritime connectivity, Sri Lanka would also benefit from entering into discussions with Pakistan (access to Central Asia), Russia (access to Eurasian Economic Union), Mauritius (access to Eurasian Economic Union), Mauritius (access to Central Asia). African Continental Free Trade Agreement) and consider how it could build on CPTPP countries in East Asia and Asia-Pacific as a longer-term goal.
Pakistani connectivity is certainly growing. Pakistani Prime Minister Imran Khan visited Sri Lanka in February this year. During his visit to Sri Lanka, Prime Minister Khan focused on Pakistan’s connectivity with Sri Lanka, its current use of the port of Karachi and the additional Central Asian options offered by Gwadar. The Muslim community in Pakistan is well positioned to supply Islamic packaging to these markets, which Sri Lanka as a Buddhist nation is less able to provide.
There are incentives for both to do so – Pakistan is a conduit for opening up new trade corridors for products made in Sri Lanka, a growing share of which will come from joint ventures with Chinese participation and Sino-Lankan companies. . China will want to access the Central Asian market and that means through CPEC.
During the visit to Sri Lanka, Khan said Pakistan allocates land to Uzbekistan for warehousing and export services, and the same facility can also be provided in Sri Lanka. Uzbekistan is a rapidly developing Central Asian country and although landlocked, it can access other regional markets which open them up to products made in Sri Lanka. Uzbekistan is surrounded by five countries: Kazakhstan to the north, Kyrgyzstan to the northeast, Tajikistan to the southeast, Afghanistan to the south and Turkmenistan to the southwest. Collectively, the countries of Central Asia have a GDP (PPP) of US $ 1,000 billion, an expected post-COVID growth rate of around 5-6%, and a population of around 73 million. Its average GDP (PPP) per capita is four times that of Sri Lanka, meaning the region is a rich market that Sri Lanka targets for exports.
Bangladesh can also benefit from using the Pakistani port of Gwadar for the same reasons, with a GDP per capita seven times lower than the Central Asian average.
Maritime connectivity is the key. The Bangladeshi ports of Chittagong, Payra and Mangla can be connected to the Pakistani port of Gwadar and CPEC, including Karachi, Port Qasim and Keti Bandar, through the Sri Lankan ports of Colombo and Hambantota to create quadrilateral access and a distribution center. . A memorandum of understanding was recently signed between the Thai Port Authority (Rawang Port) and the Chittagong Port Authority in Bangladesh. Chittagong-Ranong Port connectivity could boost SAARC-ASEAN trade if connected to Gwadar Port and CPEC through Colombo and Hambantota ports in Sri Lanka. The whole region would benefit, not just specific countries.
Sri Lankan traditional industries of tea, clothing, rice and agriculture, as well as future machinery and industrial manufacturing industries such as automobile tires, can be mixed with clothing, medicine, Bangladeshi fruits and vegetables, as well as its future IT services and electronics sectors.
Bangladesh and Sri Lanka both import goods such as cotton from Pakistan, Central Asian states, West and Central China, and even Russia. Advancing this existing trade, however, requires a holistic trilateral effort. If Sri Lanka and Bangladesh can make better use of the CPEC, they can participate in the development process in Afghanistan with Pakistan, China, Russia and Iran. South Asia’s SAARC and regional trading blocks could also be revived through these activities.
Intra-regional and international tourism can also become a platform for the growth of services. Religious tourism is a growing industry, with Bangladesh, Pakistan and to some extent Sri Lanka being more tolerant than neighboring India, where religious differences are currently being exploited politically for the benefit of mainstream Hindu politics.
However, Pakistan has many historical Buddhist sites such as the ancient civilizations of Gandhara and Takhsila. These would be of interest to Sri Lankans. Sri Lanka has important historical places in Muslim culture such as Adam’s Peak and the ancient Dawatagaha Mosque.
As regional states, Sri Lanka and Bangladesh should consider reconnecting with Pakistan and China. The Belt and Road initiative has been and is being built to promote such interconnectivity. Governments and businesses in South and Southeast Asia should consider how best to exploit it. Chinese investments could be accelerated.
The well-connected Pakistani port of Gwadar has brought a new dream to the South Asian region. This massive port is not only for Pakistan but also for all other states in the region. Chinese investment has accelerated the pace of aspirations in this regard. China’s multibillion dollar “China-Pakistan Economic Corridor” (CPEC) project is linked to the port of Gwadar. This excellent port creates a kind of possibilities and potentials for all of South Asia, Southeast Asia, Central Asia, West Asia, Eurasia, East Asia and the Middle East. Sri Lanka and Bangladesh can easily reach West China, Central Asia and Pakistan via this port.
The Pakistani port of Gwadar is of very strategic importance. China and Pakistan are working together to transform the port of Gwadar into a regional hub. By using the port of Gwadar, Sri Lanka and Bangladesh can easily access the emerging markets of Central Asian states, western part of China, Pakistan, even Afghanistan and western Asian states.
Bangladesh and Sri Lanka both import goods such as cotton from Pakistan, Central Asian states, West and Central China, and even Russia. Advancing this existing trade, however, requires a holistic trilateral effort. If Sri Lanka and Bangladesh can make better use of Gwadar Port and CPEC, they can participate in the development process in Afghanistan with Pakistan, China, Russia and Iran. SAARC’s South Asian trading block could also be revived through these activities. Intra-regional and international tourism can also become a platform for the growth of services. Religious tourism can be a growing sector in Bangladesh, Pakistan and Sri Lanka.
Sri Lankan and Bangladeshi products can be easily exported from these regions. Raw materials for the clothing industry (cotton) can be easily imported from Pakistan, China and Central Asian states. In this case, the trade relations between Bangladesh, Sri Lanka, Pakistan, China and other Muslim countries will be strengthened. Sri Lanka-Bangladesh-China-Pakistan relations (quadrilaterals) will be further strengthened and may reflect a better regional quadrilateral understanding.
(Pathik Hasan is a Dhaka-based NGO activist, researcher and freelance writer on contemporary international issues whose work has been published in numerous local and international publications. Academic background: BSS (Peace and Conflict Studies) and MSS (International Relations) under the University of Dhaka, reachable at [email protected])
– Eurasia Review