In light of the economic rise of Bangladesh, examine the opportunities for India and hope for South Asia. Discuss the associated challenges and suggest a way forward.

Bangladesh has surpassed India in terms of per capita GDP. This economic rise of Bangladesh poses new opportunities & hopes.

Reasons for economic rise of Bangladesh:

  • Subsidies & concessions due to LDC status.
  • Unique models of financial inclusion (Grameen Banks).
  • A strong and labour intensive manufacturing sector, e.g. textiles, toys.

Opportunities for India in Bangladesh’s economic rise:

  • Synergies wrt global value chains – India-Bangladesh can build on each other’s economic progress to better integrate with global value chains.
  • A prosperous neighbourhood has positive effects – growth in tourism, increased demand of goods, electricity, etc.
  • Reduced challenged of internal security for India – Migrant crisis, cross-border smuggling, insurgency, etc.
  • Greater efficacy of regional trade blocs with India like SAARC, BIMSTEC. It will also increase voice in global arena.

Hope for South Asia:

  • Regional trade – Increased prosperity in South Asia as it is least integrated regions of world.
  • Increased concentration of prosperity – Shift of global balance of power towards Asia.
  • Greater voice of South Asian region & its issues in global arena.
  • Regional issues such as freedom of navigation in Indian Ocean region will seek prominence.
  • Greater FDI inflows into Asia.

Associated challenges:

  • Increasing closeness with china.
  • India’s alleged “big brother” kind of attitude.
  • Integrating with global value chains.

Way forward:

  • Follow Panchsheel Principles while dealing with neighbours.
  • Timely delivery of promised projects.
  • Greater confidence building measures.
  • Focus on strengths such as synergy in textiles, jut, etc.

Bangladesh’s rise is a step towards realization of Asian century & must be capitalized wisely.

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