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Bangladesh’s Balancing Act Between India and China

5 min read
Current Affairs
June 28, 2026
Bangladesh’s Balancing Act Between India and China

AI Summary

The Teesta River project — a $1 billion initiative to manage Bangladesh's most critical waterway — has become the clearest front in the India-China competition for influence in South Asia. India's decades-long failure to finalise a water-sharing treaty opened the door for Beijing. Bangladesh's new government, led by Tarique Rahman, is now actively deepening Teesta cooperation with China, signalling a post-Hasina foreign policy that prioritises economic need over New Delhi's strategic comfort.

The Teesta River flows down from the eastern Himalayas, cuts through Sikkim and West Bengal, and then crosses into Bangladesh, where it irrigates some of the country's most agriculturally important northern districts — Nilphamari, Kurigram, Lalmonirhat, Gaibandha, and Rangpur. For millions of farmers in Bangladesh's north, the Teesta isn't a diplomatic abstraction. It's the water in their fields.

That distinction — between the river as lifeline and the river as leverage — is precisely what makes the current moment so consequential.

Forty Years of a Promise India Kept Breaking

Negotiations over the Teesta have remained unresolved for more than 40 years despite repeated attempts to reach a formal water-sharing agreement. A temporary arrangement reached in 1983 never evolved into a permanent treaty. The closest both sides ever got was 2011. An agreement was about to be signed during a visit by then Prime Minister Manmohan Singh to Dhaka, but it ultimately collapsed after opposition from Mamata Banerjee, then the Chief Minister of West Bengal, who argued that insufficient water remained in the river during the dry season to permit the proposed sharing formula.

Bangladesh experts allege that upstream dams constructed by India have restricted water flow, significantly and negatively impacting downstream Bangladesh. During dry seasons, Bangladesh receives only a fraction of the 1,200–1,500 cubic feet per second of water it needs, with levels dropping even below 200–300 cusecs at times.

India's inability to deliver on the treaty — blocked not by Delhi but by a state government — created the opening that Beijing has been methodically walking through.

The Project India Doesn't Want China to Touch

Bangladesh's projected Teesta River Comprehensive Management and Restoration Project, estimated to cost $1 billion, has long piqued China's interest. The first phase alone is estimated at $750 million, of which Bangladesh has requested $550 million as a loan from China, with the remaining funds coming from the government's own exchequer.

New Delhi's alarm isn't purely about water. India has serious security concerns over China's involvement in a project close to the vulnerable "Chicken's Neck" corridor — the narrow strip connecting India's Northeast with the rest of the country. Chinese engineers on the ground near Siliguri isn't a scenario India's strategic establishment takes lightly.

This is why, when China's interest became public, India moved quickly. India sent its Foreign Secretary Vinay Mohan Kwatra to Bangladesh to keep China away from the project; during the trip, Kwatra offered Indian funding for the Teesta project, putting Dhaka in a tight spot. The offer was received coolly. India had shifted its stance to offer funding for the project instead of signing the water-sharing treaty that would ensure a fair share of water for Dhaka — raising the question of why India wants to finance the project rather than ensure Bangladesh's access to the water itself.

Dhaka's New Calculus

The political context shifted sharply in August 2024, when Sheikh Hasina's government fell. The new interim government, led by Professor Muhammad Yunus, signalled a keen interest in developing a closer relationship with China. Many scholars view Bangladesh's new diplomatic postures as a significant shift, suggesting the new leadership has shown willingness to discard the balancing strategy of past governments.

That shift crystalised last week. Bangladesh and China agreed on June 25 to deepen cooperation in river management, including the Teesta River Comprehensive Management and Restoration Project, during a meeting between Bangladeshi Prime Minister Tarique Rahman and Chinese Water Resources Minister Li Guoying in Beijing. Although no financing agreement was signed during the visit, the joint statement reaffirmed China's willingness to assist "within its capacity" and accelerate feasibility studies.

Beijing's public framing was pointed. "China-Bangladesh cooperation is not directed at any third party and should remain free from interference by any third party," a Chinese official stated — a message aimed squarely at New Delhi.

The message the latest Bangladesh-China agreement sends is hard to miss: Bangladesh's new leadership is less willing to take major infrastructure decisions around Indian concerns. Officials in Dhaka have repeatedly said Bangladesh will pursue an independent foreign policy driven by economic interests rather than geopolitical alignments.

For India, the uncomfortable truth is that the Teesta wasn't lost in Beijing. It was lost in the years of a water-sharing deal that kept getting promised — and never signed.

Sources

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