China's influence in South Asia growing: Report

Pandemic has let Beijing make inroads in region by offering vaccines and funds

Early this month, Nepal's Minister of State for Health Umesh Shrestha announced that half of the country's population had received the Sinopharm vaccine from China. That added up to 149 million doses in total.

Sri Lanka and Bangladesh have both agreed to manufacture the Sinopharm vaccine for Covid-19, with Bangladesh getting over 26 million doses of the drug.

The pandemic has given China another opportunity to make inroads in South Asia by offering vaccines and developmental funds for health infrastructure. At times, aid from Beijing has outstripped that provided by India - the predominant power in the region - as well as the United States.

China has also supplied testing kits, personal protective equipment and medical supplies during the coronavirus pandemic.

"All of these countries are looking for various types of partnerships and they will go to whoever is able to help, whether India, US, China or Europe. What Covid-19 has done is that it has added some points where China has been able to come through with vaccines and other things," said Dr Deep Pal, visiting scholar in the Asia programme at Carnegie Endowment for International Peace and author of a recent report on China's growing influence in South Asia.

The report, titled China's Influence in South Asia: Vulnerabilities and Resilience in Four Countries, noted that the pandemic has exposed shortcomings in public healthcare capacities in South Asian countries. The report focuses on Sri Lanka, the Maldives, Nepal and Bangladesh.

"It is likely that in a post-Covid-19 world, when South Asian countries talk about infrastructure, they will mean hospitals and laboratories as much as ports and highways. China will be eager to step in," the report said.

It added: "The pandemic has created opportunities for China to work directly with the four countries in new ways on the provision of medical equipment, biomedical expertise, and capital for coronavirus-related needs."

China has invested heavily in major infrastructure, from roads to railways, provided a mix of grants and aid, and has become active in wooing political parties. On the odd occasion, it has also stepped in to offer help in times of political crisis, like it did in Nepal.

According to Mr Asanga Abeyagoonasekera, a geopolitical analyst and author in Sri Lanka, China has been the largest relief provider during Covid-19.

"Apart from infrastructure diplomacy, China is engaged in vaccine diplomacy, being the largest Covid-19 relief provider in Sri Lanka," said Mr Abeyagoonasekera. He described Covid-19 cooperation as a "new layer" aimed at gaining positive public perception of China within Sri Lanka.

Meanwhile, India has watched with alarm China's growing presence in what it considers its own backyard. India's vaccine diplomacy, which stalled owing to heightened domestic demand, resumed this month with a renewed focus on the neighbourhood. India has sent 100 million doses of its Covishield vaccine to Nepal as well as to Bangladesh.

The Carnegie Endowment for International Peace report said that India remained the big presence in the neighbourhood, "even though the balance is gradually shifting towards China". It also noted that the US needed to increase engagement in South Asia.

Still, the Chinese presence has not been without controversy.

Last year, Bangladesh refused to co-finance an experimental Chinese Covid-19 vaccine developed by Sinovac Biotech.

The Carnegie report found that "China's tools of influence are varied and are wielded depending on the extent of its engagement in a country, on the robustness of that country's institutions, and China's personal relationships with key regime actors".

Other analysts also believe that increased exposure to China comes with risks.

"While Chinese commercial loans and currency swap arrangements have contributed towards national efforts at reviving growth, they risk increasing already large bilateral trade deficits with China and unfavourable debt dynamics," said Dr Ganeshan Wignaraja, a non-resident senior fellow at the National University of Singapore.

"China should strengthen its support to multilateral institutions like the World Health Organisation and the International Monetary Fund to aid South Asian countries struggling with the public health and economic effects of the pandemic."

A version of this article appeared in the print edition of The Straits Times on October 23, 2021, with the headline 'China's influence in South Asia growing: Report'. Subscribe