Growing Ties

Bangladesh's fall from grace since 2020 has been precipitous. Foreign exchange reserves dropped from $48 billion in 2021 to around $20 billion, or less than three months' imports; foreign debt doubled since 2016 to $100 billion, with debt servicing that will hit $3.56 billion. Crony capitalism, rampant corruption, and a huge capital flight led to the banking sector being left in disarray, with non-performing loans constituting 10.11 percent of the total, and a liquidity crisis led to the halting of bank transactions on several occasions.

After winning four successive elections in 2008, 2014, 2018, and 2024 in Bangladesh, Prime Minister Sheikh Hasina was forced by mass protests to resign and flee to India on August 5, 2024. She had alienated both students and the military, a traditionally toxic combination in Bangladesh that leads to the downfall of governments.

This would have come as no surprise to any interested observer; Indian visitors had been warned by local well-wishers since 2021 that India's reputation was being progressively besmirched by Hasina's corruption and autocratic behavior. Many Indian observers, including former diplomats, had warned in print that India's influence was in jeopardy after Hasina's departure.

Once hailed as a pro-democracy leader, Hasina in 2011 annulled the law that provided for free and fair elections under a caretaker government, opposing advice from a commission that the practice should continue for some time.

Each of her three victories after 2008 were regarded as sham, with either the opposition absent or intimidated by thousands of arrests. The USA and EU made their displeasure public, and in 2021, Washington sanctioned the Rapid Action Battalion for human rights violations.

Nevertheless, Hasina and her party, the Awami League, were robustly supported by New Delhi because Bangladesh's geography makes it intrinsic to India's security, with 4,156 km of common border and its northern and eastern frontiers contiguous with India's sensitive Northeast states.

Hasina was accommodative to India's security concerns, which overrode other considerations, but it would be interesting to speculate on what advice, if any, New Delhi rendered to Hasina during the recent past about the gathering storm. If any advice was given, it was likely to have been ignored, since the former prime minister is a self-righteous personality, impervious to reasoned argument.