Bangladesh is adjacent to vital Indian Ocean sea-lanes. Beijing is planning to build a deep-sea port on Sonadia Island off the coast of southeast Bangladesh. In 2010, a US Congressional Research Service report on Bangladesh noted that “port development in Bangladesh could be seen as part of a ‘String of Pearls’ strategy that could be used by China to secure sea lanes that cross the Indian Ocean.”
Bangladesh’s relations with China strengthened during the 2002-2006 BNP government of Prime Minister Khalida Zia—a process that continued under the Awami League after 2006.

Cash-strapped Dhaka now relies on funds from Beijing, and China is Bangladesh’s biggest trading partner, with two-way trade surpassing $US8 billion in 2012.
Beijing is also involved in infrastructure projects, developing roads, railways and the country’s main harbour at Chittagong, and the Bangladesh-China-India-Myanmar (BCIM) economic corridor, which aims to connect Kolkata with China’s Kunming city via a highway running through Bangladesh and Myanmar. China has said the BCIM will “change the geo-political map in Asia and the world.”
Dhaka and Beijing also signed a defence pact in 2002 under Zia’s government. Since then China’s arms supplies have increased, including artillery guns, missile systems and howitzers.

Bangladesh built a missile launch pad near Chittagong port with Chinese assistance and the two navies collaborated extensively in 2010. Last month, Dhaka finalized an agreement to buy two submarines from China.
Michael Kugelman, an analyst at the Woodrow Wilson International Centre for Scholars, has highlighted the need for the US to pay more attention to Bangladesh. Writing in the Foreign Policy journal, he warned: “Bangladesh has largely been ignored—a troubling omission.”

“Given its geopolitical significance and volatile neighbourhood, Washington needs to keep a close eye on Bangladesh this year,” he insisted.

Elaborating on his advice, Kugelman told AFP: “The United States has an interest in maintaining stability in the region as it prepares to withdraw combat troops from Afghanistan and also tries to increase clout in Asia faced with the rise of China.”
Addressing the US Congress Human Rights Commission last July, Robert Blake, a former assistant secretary of state for south and central Asian affairs, said Bangladesh is of strategic importance to the United States.

The US government has one overriding preoccupation at present vis-à-vis Bangladesh, and it is cut Beijing’s clout in Dhaka, as part of its “pivot to Asia” to combat China’s influence.
Before the election, Washington supported the government’s crackdown on Islamic fundamentalists, including Jamaat e Islami (JEI), which are part of the BNP’s Coalition.

Responding to the US criticism, Zia told the New York Times that the BNP was ready to break ties with it. “With Jamaat, it’s not a permanent alliance,” she said, positioning herself to benefit from any new poll.  Now the US is seeking to refashion the opposition BNP while putting pressure on the Awami League.
Some analysts predict that Zia would revive her 2001-2006 “Look East” policy, mainly aimed at developing ties with China. In 2012, she made a week-long visit to China and met Xi Jinping, then China’s leader-in-waiting.
India’s approach to Bangladesh scene differs from Washington’s line. It has longstanding ties to the Awami League that date back to the period of Liberation War in 1971.  India is also satisfied with the Awami League’s help in cracking down on various NE insurgent groups with bases mostly in the Chittagong forest belt.

In late 2009, Dhaka police arrested United Liberation Front of Assam (ULFA) chairman and founder Arabinda Rajkhowa.
In a lengthy report last month, Lisa Curtis and Maneeza Hossain from the Heritage Foundation made out a strong case for Bangladesh’s relations with India, which they noted have improved under the Awami League.
Pointing out that  China is slowly building up ties to Bangladesh and competing with India for dominance in the region. they have a homily for the US.

It is that  the US should “facilitate strong India-Bangladesh ties since New Delhi’s influence in the country will help blunt the growing Chinese presence.”
The Curtis- Hossain report also pitches for greater US naval contact and cooperation with Bangladesh to further counter China.