South Asia is undergoing a gradual but important shift. Smaller states now command a widening array of options, and India’s primacy is quietly giving way. The lesson is clear. Regional leadership can no longer rest on geography and must be sustained through credible and mutually beneficial engagements that compare favourably with the alternatives.
China’s challenge begins at India’s border. Both countries
fought in 1962, continue to dispute a frontier of roughly 3,500km and had their deadliest confrontation in decades in the
Galwan Valley in 2020. Relations have
cautiously normalised but the underlying strategic rivalry remains unresolved.
Economic dependence complicates the rivalry. India imported nearly US$132 billion of Chinese goods in the year ended March, more than from any other country. A government analysis has since reportedly identified about US$51 billion in critical imports that could be replaced by pushing domestic production, partly to reduce reliance on China. Thus, China competes strategically with India while retaining considerable influence over its industrial supply chains.
Pakistan provides the clearest expression of Beijing’s regional strategy. China supplied
81 per cent of Pakistan’s major arms imports between 2020 and 2024. This year, Pakistan commissioned the first of eight Chinese-designed
Hangor-class submarines under a US$5 billion programme. It also
raised 1.75 billion yuan (US$258 million) through its first yuan-denominated sovereign “panda bond” in China’s market.
Bangladesh, meanwhile, illustrates the risks of tying bilateral relations too closely to one political party. India’s partnership with former prime minister Sheikh Hasina strengthened bilateral cooperation but
her fall – her government was deposed after a popular movement in 2024 and her party, the
Awami League, banned – exposed the weakness of that approach. Her continued
stay in New Delhi does not help India’s relationship with Bangladesh. Consequently, China’s influence is expected to expand.
New Bangladeshi Prime Minister Tarique Rahman’s decision to
include China in his first overseas tour carried political weight. In Beijing last month, he met Chinese President Xi Jinping and sought greater cooperation and investment. The visit showed Bangladesh can use its growing ties with China to negotiate with India from a
stronger position.
