PM Khaleda Zia's assertion during a speech in the Bangladesh Institute of International and Strategic Studies (BIISS) that the SAARC nations should 'adopt regional grouping to firmly deal with the changing global order' came on the same day India and China signed the historic agreement. But, by the time the PM broached her thesis, India's main thrust in foreign policy might have veered away from the SAARC due to India's renewed preoccupation with China.

Changing face of geopolitics

The Sino-Indian agreement came into existence after nearly two decades of arduous diplomacy. Expectedly, it had initiated the beginning of a new set of geopolitical possibilities in the region by reducing greatly the threat of further hostilities between the two nuclear-armed neighbours.

The impact of enhanced Sino-Indian trading in coming years on the Bangla-India economic relations, hence, should feature prominently in the litany of Dhaka's concerns pertaining to this emerging scenario.

Another concern is the joint approach that India and China will take to exert their influences astride the Indian Ocean. As a strategically located Indian Ocean littoral, Bangladesh until now received a virtual carte blanche from China -- partly due to embedded Chinese policy to counterbalance India, and partly to her desire to secure a different route of access to the Indian Ocean. From now on, Bangladesh might have to stay in the middle course while dealing with these two 'no-more-estranged' regional powers due to the increased US interest in South Asia.

From a global perspective, the geopolitical scramble among the trio -- India, China and the US -- to control the Indian Ocean and its littoral might make it more difficult for small nations like Bangladesh to carve out a diplomatic niche while pursuing bona fide geopolitical options. Economically, the $1.7 trillion economy (combined GDP) that China and India jointly command will lay open further opportunities to Bangladesh in her quest to 'look East' for economic integration.

Dhaka must also take into cognizance that the US' move to induct Pakistan and Bangladesh in the US-sponsored free trade entity (Middle East Trade and Investment Forum) might have been viewed by China and India with consternation. For, the global backdrop to this changed Asian reality was fashioned to a great extent by the US' desperation to preserve global hegemony on one hand, and surmount the threats from Muslim extremists, on other. This twin US mission is seldom in sync with perceived geopolitical interests of many Asian states, aside China and India.

Dhaka's elevated status

Due to such extraneous influences on the region's geopolitical situations, the war against Al-Qaeda made Pakistan an indispensable ally of the US while Bangladesh's geopolitical stature as a staging post to circumvent China (and the Communist Myanmar) at the shores of the Indian ocean -- as well as her bridging role between Far East and South Asia -- strengthened Dhaka's acceptance as one of US' strategic partners.

Dhaka must, consequently, not forget to view the emerging Indo-China coalescence as a strategic move of the duo in response to the US' coming closer with Pakistan.

That complexity notwithstanding, one would expect that the phenomenal increase in the volume of Indo-Chinese bilateral trade between 1993-2003 (from a trickle of US$300 m to $5 b) will propel Bangladesh to devise ways to redress her existing trade imbalance with India. Dhaka may also seek new avenues and opportunities to make further foothold in the vast Chinese market via the Indian North-East.

Bangladesh also seems poised to pursuing an aggressive and pro-active trading policy to derive substantive economic dividends from its hoped for membership in the ARF on one hand, and from the membership of the US-sponsored Middle East Trade and Economic Forum, on other. This will warrant the best of Bangladesh's diplomatic juggling as well as qualitative edges of 'Made in Bangladesh' products and services.

Factors and perceptions

A positive aspect of Bangladesh's 'look East' policy is that her membership in the ARF will bridge her through a different channel with countries as distant as the US, Canada and Australia; who too are members of the ARF and the Asia Pacific Economic Council (APEC). The caveat is: strategic rivalry between China and the US may over tax Bangladesh's loyalty.

Viewed from the Chinese perspective, it would seem that the array of the US' military deployment from the Chinese Central Asia to the shores of the South China Sea does indeed constitute a virtual encirclement of China. On the other hand, one can hardly be blamed for being inquisitive about one particular aspect of this fast moving geopolitical shift and shuffle: Why should India so hurriedly move towards mending fences with China?

A number of factors have combined to bring about this long-awaited thaw in the Sino-Indian relations. Chief among them is the embedded US perception of China's geo-strategic ambitions in Central and South East Asia in particular, and of India's in the Indian ocean littoral in general.

China and India have also felt the necessity to put into proper usage the potentiality of a combined market that holds in its embrace nearly half of the global consumers.

Furthermore, due to the Indo-China agreement's triumphant efficacy in ensuring Delhi's sovereignty over Sikkim and Beijing's over one third of the old Tibet, a new horizon of trading among nearly 2.8 billion people of the region is all but open now. Dhaka must integrate herself to this emerging Asian market.

Silk route and Asian free trade

The most illuminating part of the agreement is the revival of the historic Silk Route that runs 15,000 feet high across the mountain passes stretching from Tibet to India. The same route connected the West with China via the Middle East and Central Asia in the 16th and 17th centuries. Bangladesh's 'look East' proclivity can immensely be boosted if Dhaka can strike a right balance, simultaneously, between its strategic alliances with the US and China.

Observers also believe the thaw in the Sino-Indian relations might help remove the last hurdle from making the entire Asian continent a free trading zone of a sort that might seem akin to the EU. Should that come to pass, Dhaka's economic future may turn brighter.

For, India's decision to mend fences with China is an essential byproduct of her perceived geo-strategic reality, hence the move is a substantive one. India shares 4,056 km borders with China, and, in modern times, the two nations fought a brief war as early as in 1962. The war resulted in the Chinese occupation of 38,000 sq km of Kashmiri territory and about 90,000 sq km of territory from Arunachal Pradesh.

Besides, the strategic asymmetry between the two neighbours is highlighted by the 'Chinese capability to hit every major Indian cities,' as was alarmingly noted in India's 'Annual Defense Ministry Report 2002.' The report added, 'China's submarine launched ballistic missiles pose a major threat to India's naval activities in the Indian Ocean'. By clinching this historic deal, India managed to neutralise, in a single stroke, the Chinese threats in Tibet and Nepal.

Myanmar factor

As well, India's strategic concern vis a vis China stretches far beyond. Especially, the depth of Myanmar-China military collaborations has been as much troubling for India in recent years as it has begun to turn Bangladesh an important ally of the US.

China helped Myanmar to modernise its naval bases in Haingyi, in the Coco Island, Akyab, Zu Det Kyi, Mergui and Khaukhphyu by building radar, refit and refueling facilities. A Chinese SIGINT (signal intelligence) facility on the Coco Island -- only 30 nautical miles from India's Andaman Island -- is reportedly on the verge of completion. India's defence minister George Fernandez claimed earlier that 'Myanmar had leased the Coco Island to China'.

India also viewed with utmost concern the Chinese opening of a new route toward the Indian Ocean via Myanmar, which -- being on top of its existing route via the strait of Malacca -- sent an alarming signal to Delhi. This concern was exacerbated further by the Chinese building of a highway that originated from Kunming (capital of China's Yunnan province) and terminated at Myanmar's border city of Shewli.

Beijing's pipeline plan to extend the road up to the Irrawadi River -- that flows into the Andaman Sea-- sent chills of shiver in the spines of Indian strategists. Amidst such concerns, India lost little time in inching closer with China once the US embarked upon a global military campaign and stationed her troops all over Asia after the 9/11 incident.

The new reality demands that Dhaka must strive to accrue as much economic dividends as is possible from this changed regional atmosphere which carries in it a huge potential to extend Bangladesh's export destinations within the region.

M. Shahidul Islam is a Senior Assistant Editor of this paper. He is also an author and columnist.