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Why Sri Lanka and Bangladesh should use Gwadar Port


Gwadar Port
Gwadar Port

Pakistan’s well-connected Gwadar Port has brought a new dream for the South Asian region. This massive Port is not only for Pakistan but also for all other regional States. Chinese Investment has accelerated the pace of aspirations in this regard. China’s multibillion dollar project the “China Pakistan Economic Corridor” (CPEC) is linked with the Gwadar Port. This excellent Port creates some sort of possibilities and potentials for the entire South Asia, South East Asia, Central Asia, Western Asia, Eurasia, East Asia and Middle East.

Sri Lanka and Bangladesh can utilize the facilities of the Gwadar Port. Sri Lanka and Bangladesh can use Pakistan’s Gwadar Port to boost trade with Central Asia, Western China and Pakistan. The Gwadar Port is going to be regional trade hub in the region. Sri Lanka and Bangladesh can reach Western China, Central Asia, and Pakistan easily through this Port.

Pakistan has some regional connectivity with Central Asian States through Afghanistan. If Bangladesh’s ports such as Chittagong (Chattogram), Payra and Mangla can be connected with Pakistan’s Gwadar Port, Karachi Port or Port Qassim via Sri Lanka’s Colombo and Hambantota Ports, both Bangladesh and Sri Lanka would benefit mutually. Pakistan, Afghanistan and Central Asian states would also benefit.

Trade ties

Sri Lanka can use the Gwadar Port for warehousing to facilitate trade with Afghanistan, Central Asian Republics and the Middle East. Pakistan’s exports to Sri Lanka have doubled in recent times. Total trade is US$ 400 million, with exports over US$ 300 million whereas imports are less than US$ 100 million. Sri Lanka’s main export item is tea and Pakistan imports a very meagre quantity from Sri Lanka with the bulk of Sri Lankan tea going to other countries.

Sri Lanka can use the Gwadar Port’s gateway for exports to Afghanistan and then Uzbekistan and from there to the entire Central Asia. Sri Lanka has already showed a keen interest in the proposal during the visit of PM Imran Khan in February this year. Pakistan decided to allocate land to Uzbekistan for warehousing and export. Sri Lanka should try to get the same facility. Sri Lanka could benefit by offering special packages to international shipping lines for the use of facilities in both Colombo and Gwadar Ports, especially to vessels coming from East Asia. On the hand, Pak-China-Sri Lanka-Bangladesh trade ties would boost up.

Afghanistan is now viable and politically stable. The Taliban has formed a Government. Regional states including China and Russia are interested in investing for the development of infrastructure and connectivity of Afghanistan. Sri Lanka and Bangladesh can also play a role in the development process in Afghanistan.

Therefore, Sri Lanka and Bangladesh should use the Gwadar Port to reach these countries for ensuring their own business interests. Although there are some bilateral crises between Bangladesh and Pakistan, both Governments should reconsider the issue of mutual interest under the present global order. Pakistan should play an important role in this regard. It has some responsibilities to Bangladesh. It has to be understood and realized. But these problems must be solved diplomatically with bilateral efforts. On the other hand, there is a Free Trade Agreement (FTA) between Pakistan and Sri Lanka. Pakistan’s top exports to Sri Lanka include textiles and cement with and the latter’s top exports to Pakistan being tea, rubber, and readymade garments. Pakistan and Sri Lanka both could benefit from growing trade ties if better connectivity amongst Sri Lanka-Bangladesh and Pakistan could be ensured.

Pakistan’s Gwadar Port has a very strategic significance. China and Pakistan are working together to transform the Gwadar Port into a regional hub. Using the Gwadar Port, Sri Lanka and Bangladesh can easily access the emerging markets of Central Asian states, Western part of China, Pakistan, even Afghanistan and the Western Asian states.

Sri Lankan and Bangladeshi products can be exported from those regions easily. The raw materials for the apparel sector (cotton) can be imported easily from Pakistan and Central Asian states. In this case, the business relations among Bangladesh and other Muslim countries will be strengthened. Sri Lanka-Bangladesh-Pakistan economic ties (Triad) and to some extent Sri Lanka-Bangladesh-China-Pakistan (Quadrilateral) ties will be further bolstered.

Sri Lankan traditional tea, apparel, rice, and agricultural industries, together with up-coming machinery and industrial manufacturing industries such as auto tires can be mixed with Bangladeshi apparel, medicines, fruits, and vegetables along with its upcoming IT services and electronic sectors.

Bangladesh and Sri Lanka both import goods such as cotton from Pakistan, Central Asian States, Western and Central China and even Russia. Pushing this existing trade however requires a holistic trilateral effort. If Sri Lanka and Bangladesh can make better use of the Gwadar Port and the CPEC, they can take part in the development process in Afghanistan with Pakistan, China, Russia, and Iran. The South Asian SAARC trade bloc may also be revived through these activities. Intra-regional and international tourism can also become a platform for services growth. Religious tourism can be a growing sector amongst Bangladesh, Pakistan and Sri Lanka.

During the visit to Sri Lanka, PM Khan commented that Pakistan is allocating land to Uzbekistan for warehousing and export services, and that the same facility can also be provided to Sri Lanka. Uzbekistan is a rapidly developing Central Asia nation and although double landlocked, can access other regional markets that open these up for Sri Lankan made products. Uzbekistan is surrounded by five countries: Kazakhstan to the north, Kyrgyzstan to the north-east, Tajikistan to the southeast, Afghanistan to the south, and Turkmenistan to the southwest. Collectively the Central Asian nations have a GDP (PPP) of US$ 1 trillion, a projected post-COVID growth rate of about 5-6 per cent and a population of some 73 million. Its average GDP (PPP) per capita is four times higher than that of Sri Lanka, meaning the region is a wealthy market for Sri Lanka to target for exports.

Chinese BRI project

As regional states, Sri Lanka and Bangladesh should be examining a revival of connections with Pakistan. The Belt and Road Initiative (BRI) has and is being built to promote such interconnectivity. South and Southeast Asian Governments and businesses should be examining how best to exploit it.

There is no shipping line connection between Bangladesh and Pakistan. Bangladesh imports raw materials and products from western China and Central Asian Countries through either Singapore via Malacca strait or by air. So, the cost of transportation and wastage of time is huge for Bangladesh. Bangladesh can easily overcome this utilizing the Pakistan’s Gwadar Port. Bangladesh has already joined the China run BRI project in 2017. Pakistan, Bangladesh and Sri Lanka are all members of the Chinese BRI project.

The whole South East Asia, South Asia, Central Asia and West Asia would benefit. ASEAN and SAARC Free Trade Zones could be created. Bangladesh could benefit ultimately. The dependence of Bangladesh on India will be decreased. A greater regional interest could be confirmed.

Why Sri Lanka and Bangladesh should utilize Pakistan’s Gwadar port: For ensuring their own business interest; To strengthen the economic and trade ties with Pakistan, Afghanistan, Central Asian States, West Asian countries and Even Russia and China; To decrease their huge trade dependence on India; For creating the ASEAN and SAARC Free Trade Zones; All states in those regions would benefit mutually in the sector of trade, Counter-terrorism approach from multilateral ties; Enhancing bilateral relations could contribute to the growth of trade and investment relations with ASEAN and BIMSTEC countries. This will create an opportunity to serve greater regional interest; Re-establishing the Himalayan-South Asian connectivity can occur if political and diplomatic solutions to Bangladesh-Pakistan strained ties can be found. Sri Lanka could be a mediator in this regard; The usage of the Gwadar Port by Sri Lanka and Bangladesh would ensure the maximum benefit of the people.

(Pathik Hasan is a Dhaka-based NGO activist, researcher and freelance writer on contemporary international issues whose work has been published in many local and international publications. Academic background: BSS (Peace and Conflict Studies) and MSS (International Relations) under the University of Dhaka. He can be reached at pathikhasan1141@gmail.com)

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