Take note of Bangla crisis, hedge bets

Bangladesh has managed to secure a loan from the IMF. This may help in the short-run but as it implements the conditions, public discontent will grow

Bangladesh is roiled in multiple crises. Its economy is in deep trouble. Foreign exchange reserves have fallen below $33 billion. The pandemic not only shrank foreign remittances to Bangladesh but also weakened global demand for its exports. The situation worsened with Russia’s invasion of Ukraine, which raised the cost of imports, forcing Bangladesh’s Awami League (AL) government to cut imports.

This has led to a shortage of essential commodities. The country is battling inflation, too. Meanwhile, opposition parties, which were largely comatose given their decade-long suppression by the AL government, have stirred into action. In the economic crisis, they have found a strong issue to mobilise the masses against the government. The opposition Bangladesh Nationalist Party has held several well-attended rallies across the country.

The government’s use of coercive force to disrupt rallies is not working. Bangladesh has managed to secure a loan from the IMF. This may help it tide over the crisis in the short-run but as it implements the conditions, public discontent will grow. The country is due to vote in general elections in a few months and the BNP and its allies are calling for elections under a caretaker government, fearing that as in 2014 and 2018, when polls were held under the AL government, this time, too, the election would be rigged to favour the ruling party.

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Things are not going well for the Awami League, and this could spell trouble for India. For decades, New Delhi has supported AL. Such support was mutually beneficial. Prime Minister Sheikh Hasina has been sensitive to India’s security concerns.

There is reason for India to worry now as Hasina may not win if elections are free and fair. Complicating the situation are geopolitical rivalries. There is not only the India-China contest for influence in Dhaka, the US, keen to draw Dhaka into its Indo-Pacific strategy, is locking horns with Russia and China over it. Regional and global powers are crafting their strategies as elections near. India must revisit its approach to Bangladesh as the situation is changing on the ground. Hitherto, Delhi has put all its eggs in one basket. In contrast, China builds strong relations with all parties and works to further its interests with whichever party is in power.

It is not too late for the Awami League to get its act together. The economic crisis is not as serious as those in Sri Lanka and Pakistan. After all, Hasina did usher in rapid economic development. India should support Bangladesh’s economic revival while nudging Hasina to hold fair elections, perhaps by agreeing to polls under a neutral caretaker government.