‘Even Bangladesh has now collapsed’: Entrepreneur links China to 5 South Asian meltdowns

China’s growing impact in South Asia has left many countries financially preferable and politically vulnerable through high interest rate loans and large-scale infrastructure projects.

From the debt distress to institutional division, many countries show serious strain.

“Even Bangladesh has now collapsed with anarchy and the spiral of the bottom.”

Although the data does not fully support this cleansing suit, the main stress signals are real.

Bangladesh
The country catches the illegality, to increase violent protests and radicalization. The temporary government is unable to ensure control, and the army warned the “self-proposed crisis.” Inflation is high, investments have weakened, and growth has slipped up to 3.3-3.9% for FY25. The economy remains functional but barely.

Sri Lanka
Despite modest growth forecasts, Sri Lanka continues to fight high poverty, inflation and broken currency. It is defaulted on its foreign debt in 2022 and still owes China more than half of its foreign debt. The main projects have given limited returns, and debt service remains a major risk.

Maldives
While GDP growth is expected by 6.4%, almost 20% of the Maldives’s debt is owed to China. The country’s economy largely depends on tourism, and any external shock can prompt balance. Maldives-China FTA could also deteriorate trade deficit and damage local industries.

Pakistan
Pakistan remains a politically unstable, growing unemployment and fragile fiscal base. Through CPEC, Chinese loans have stimulated the infrastructure, but also the bubble debt and raised the sovereignty concerns. Investors’ trust remains shocking.

Afghanistan and Nepal
The Afghan economy is isolated, depends on the help and suffers from poverty. Chinese engagement is limited and slow. However, Nepal is stable on paper, there is an increase in the increase in dependence on trade deficit and Beijing’s support for Beijing’s support for Beijing.