The present government of Bangladesh, under Prime Minister Tarique Rahman, is likely to uphold the earlier interim government’s recommendation to remove 11 India-led projects. Most of these projects were at preliminary stages of implementation, where there were some differences in contractual clauses.
These cancelled ventures include four railway projects – the Khulna-Darsana double line track, the Parbatipur-Kaunia railway conversion, the Bogura-Sirajganj new railway link and the Syedpur Carriage Workshop modernisation. The other projects include the Mongla Economic Zone and Bangabandhu Sheikh Mujib Shilpa Nagar. The Indian economic zone projects have been repositioned for domestic industrial use. Besides, the Payra Port multi-purpose terminal and Ishwardi Airport modernisation projects have also been cancelled.
Bangladesh and India have 42 projects that are being managed by a combined line of credit (LoC) of $7.3 billion (across three separate agreements since 2010). Out of these, 11 delayed projects are likely to be removed, while those already underway will continue. This will also reduce Bangladesh’s LoC burden to $4.68 billion.
The first part of this LoC came into effect in 2010, valued at $862 million. Out of the 15 projects listed under that agreement, 12 are complete, while the remaining three are active and in progress. The second LoC was valued at $2 billion and focused majorly on transport, healthcare and IT infrastructure. The third LoC, valued at $4.5 billion, was meant for power networks, railway lines and shipping infrastructure.
It may be noted that 14 projects, where India partnered with Bangladesh, are already completed. These include Bhairab and Titas bridges, which have eased congestion on the Dhaka-Chittagong route. Besides, the Khulna-Mongla 65 km port line – a broad-gauge line, which connects up Bangladesh’s largest port network – has been completed. In addition, over 500 single/double-decker AC and non-AC buses and trucks have been acquired for the Bangladesh Road Transport Corporation (BRTC) under these projects.
“In all, about 18 ongoing projects have been delayed,” affirms a source. “These include Dhaka-Tongi-Joydebpur rail expansion, Ashuganj river port to Akhaura land port road, 12-district IT/ high-tech parks: infrastructure set-up aimed at driving digital inclusion and creating technology jobs across multiple divisions and power transmission upgrades. Large-scale energy grid infrastructure includes the Barapukuria-Bogura-Kaliakair 400 kV line project”.
There obviously is a strain between India and Bangladesh at present. The anti-Bangladeshi stance taken by Assam’s chief minister, Hemanta Biswas Sarma, didn’t go down well with Bangladesh. Sarma has been propagating the removal of Bangladeshis living in India and has said that some would be forcibly pushed back through the border. Recently, Zahed Ur Rahman, adviser, information & broadcasting, Bangladesh prime minister’s office (who has made some derogatory remarks against India), returned from Delhi airport after he was questioned for over an hour. An Indian diplomat was summoned in Dhaka to explain this incident.
Financial grant cut
In addition, India, playing host to Sheikh Hasina, the erstwhile prime minister, Bangladesh, has become a bone of contention with Bangladesh. Also, India has halved its financial grant to Bangladesh in the 2026-27 Union Budget, reducing the allocation from Rs120 crore in the previous year to Rs60 crore.
“Increasing presence of Pakistani military in Bangladesh, as also the two countries (once sworn enemies) warming up to each other, are being viewed as a security challenge for India,” says an expert on India’s neighbourhood relations. “Eyebrows are also being raised in India over the possibility of China taking over the development of the Teesta project, which was being touted as going in India’s favour earlier.”
There is little information on when Prime Minister Tarique Rahman will make his first official visit to India. He is expected to visit Malaysia and China during the course of this month. “In the neighbourhood, the first visit of the newly-elected leader is always viewed as an indicator of bilateral ties with the country he/she chooses to visit,” observes an expert on India’s neighbourhood relations. “We would have liked to see PM Rahman visit India first. There needs to be a reset of existing undercurrents, as Bangladesh is not just a neighbour but also one which has had close political, economic and social ties with India”.
When and how things will begin to improve between the two nations only time can tell; until then, one can only hope that the ‘neighbourhood’ comes first for both countries in the bilateral context.