India Eyes Bangladesh’s AA Diplomacy Warily

Bangladesh’s Quiet Diplomacy with Arakan Army: What It Means for India and the Region

 

Bangladesh's Strategic Calculus – Engagement Born of Necessity

 

The recent revelation that Bangladesh has opened informal lines of communication with the Arakan Army (AA) marks a striking pivot in Dhaka’s approach to the evolving crisis in Myanmar. The move is pragmatic, not ideological. With over 1.2 million Rohingya refugees already burdening its overstretched infrastructure, Bangladesh simply cannot afford a second influx triggered by the deteriorating humanitarian and security situation in Rakhine State.

Against this backdrop, the AA's capture of 270 kilometres of territory along the Bangladesh-Myanmar border – including control of Maungdaw and Taungup – placed the ethnic armed group at the heart of border stability. Dhaka’s decision to engage the AA underscores a fundamental realpolitik: control on the ground often trumps diplomatic orthodoxy.

Speaking on 21 May, Bangladesh's national security officials made clear that the decision to establish contact with the AA was shaped by necessity. With the junta’s grip on western Myanmar weakening, the AA has become an unavoidable stakeholder in determining both the fate of the Rohingya and the future of Rakhine State. “It is Bangladesh’s duty to protect its border and keep it peaceful,” said Khalilur Rahman, the Chief Adviser’s spokesperson. “For this reason, Bangladesh decided to make informal contacts with the Arakan Army.”

This is more than just conflict management. Bangladesh is attempting to create a humanitarian corridor into Rakhine, avert famine-like conditions predicted by the UNDP, and create conditions conducive to the long-delayed repatriation of Rohingyas. The AA is expected to guarantee non-discrimination in aid distribution, inclusion of Rohingyas in local governance, and a cessation of violence. Failure to do so, officials warned, could end Dhaka’s fledgling ties with the group.

 The Rise of the Arakan Army – A Parallel Power in Western Myanmar

Founded in 2009 as the armed wing of the United League of Arakan (ULA), the Arakan Army has rapidly transformed from a fringe ethnic militia to a potent military and political force. Its vision – articulated through the “Arakan Dream 2020” and “Way of Rakhita” – seeks to reclaim sovereignty for the Arakan people and restore a historical Rakhine nation.

The 2021 military coup proved to be an inflection point. As the junta lost legitimacy and coherence, the AA surged. It now controls 14 of Rakhine’s 17 townships and has launched offensives in neighbouring Chin and Magway regions. Its capture of Ann, the Western Military Command headquarters, was a strategic triumph, cutting the junta’s supply lines and morale. Analysts suggest the AA is now laying the groundwork for a de facto state within a state – complete with local governance structures and a growing parallel administrative apparatus.

Yet, this transformation is not without its ambiguities. Despite military successes, questions remain about the inclusivity and accountability of the AA’s governance. For Bangladesh, the central concern is whether the AA’s vision of Arakan nationalism includes or excludes the Rohingya. The group’s track record is mixed. While it has made gestures towards reconciliation, its political structure has yet to fully integrate Rohingya voices – a red line for Dhaka, which fears the legitimisation of another exclusionary polity on its doorstep.

 China’s Calculus, Bangladesh’s Gamble – And India’s Strategic Dilemma

Any discussion of the Arakan Army’s ascent must account for the shadow of Beijing. China’s support – both direct and indirect – has been crucial. Reports suggest that up to 90% of AA’s funding comes from China-linked channels. Sophisticated Chinese arms, including anti-aircraft guns and rockets, have surfaced in AA’s arsenal, often routed through the United Wa State Army (UWSA) and other members of the Northern Alliance. Beijing’s plausible deniability strategy – funnelling support via proxies like the UWSA – allows it to exert leverage without formal recognition.

For China, the AA is a tool to exert pressure on the junta and shape post-conflict outcomes in Myanmar. Beijing has invested heavily in the China-Myanmar Economic Corridor (CMEC), including the strategic Kyaukphyu port in Rakhine. A friendly or pliable AA could serve as a guarantor of China’s infrastructure interests, ensuring access to the Indian Ocean while keeping Western and Indian influence in check.

Bangladesh’s engagement with the AA, therefore, must be seen in this geopolitical context. While Dhaka claims neutrality and humanitarian intent, its recognition of AA’s de facto control could inadvertently legitimise Chinese influence in western Myanmar. Moreover, should the AA emerge as a long-term political authority in Rakhine, China’s sway over both its economic and political direction would likely intensify.

 And where does this leave India?

Strategically, India is watching with unease. It has invested in the Kaladan Multi-Modal Transit Transport Project, which connects its Northeast to the Sittwe port – now on the frontline of AA-junta hostilities. If the AA consolidates power in the region, India will be compelled to engage with it, either directly or via backchannels, to safeguard its infrastructure and supply chains.

More broadly, a Chinese-backed AA regime along Bangladesh’s border would deepen Beijing’s encirclement of India’s eastern periphery. With China already embedded in Pakistan, Nepal, and Sri Lanka through Belt and Road projects, AA-held Rakhine could become another strategic node in this geopolitical web. India’s reluctance to engage ethnic armed groups, traditionally seen as domestic actors in Myanmar’s internal affairs, could leave it sidelined in shaping outcomes.

In this fluid context, Bangladesh’s outreach to the AA is a gamble – but one born of necessity. For Dhaka, it is about survival, not alignment. For New Delhi, it is a wake-up call. Ignoring the Arakan Army’s rise, and the shifting power dynamics in Rakhine, would be a strategic error. India must recalibrate its approach – engage pragmatically, secure its interests, and ensure that its vision for regional connectivity does not become collateral damage in a new Great Game unfolding on its eastern frontier.