The closure of the United States Agency for International Development (USAID) under the Trump administration has raised doubts over the future of the U.S influence in the Global South. The abrupt policy shift disrupts ongoing humanitarian and economic development efforts, particularly in South Asia, and creates an opportunity for China to expand its soft power in the region.
With USAID pulling back, China’s extensive financial engagement and investment in South Asian countries like Pakistan, Bangladesh, and Sri Lanka are likely to deepen, altering the geopolitical landscape.
USAID has played a role in South Asia, funding programs in health, education, and infrastructure. In Pakistan, USAID contributed over $8.5 billion between 2002 and 2020, funding projects in energy, agriculture, and governance. Its departure leaves a vacuum that China is prepared to fill through initiatives like the Belt and Road Initiative (BRI).
Under the BRI, China has already committed more than $62 billion to Pakistan through the China-Pakistan Economic Corridor (CPEC), with major investments in energy and transportation infrastructure. As USAID funding diminishes, Pakistan will likely rely even more on Chinese investment.
In Bangladesh, USAID provided over $7 billion in development assistance over the past five decades, focusing on health, climate resilience, and disaster response. However, China has made significant inroads in the country, particularly in infrastructure projects. Chinese companies have been involved in the construction of key projects such as the Padma Bridge rail link and the Dhaka - Chittagong railway expansion. As USAID reduces its role, Bangladesh has increasingly sought Chinese financing, including a $3.6 billion loan for the Payra coal-fired power plant, underscoring China's growing economic presence.
Sri Lanka has also been a significant recipient of USAID assistance, receiving over $2 billion in aid since 1956. However, Chinese investments, particularly in port development and real estate, have dramatically increased over the past decade. The construction of the Hambantota Port, funded through a $1.1 billion Chinese loan, resulted in Sri Lanka ceding a controlling stake to a Chinese company on a 99-year lease due to debt repayment struggles. As USAID’s role diminishes, Sri Lanka remains financially tied to China, increasing its dependence on Chinese-backed infrastructure projects.
China's financial engagement in South Asia has been extensive, with its total foreign direct investment (FDI) in the region reaching approximately $40 billion. In addition, China’s global foreign aid expenditures rose from $631 million in 2003 to over $3 billion by 2023. This financial clout allows Beijing to shape economic policies in recipient countries, often in ways that align with its strategic interests. The decline of USAID’s presence may further cement China’s influence, reducing Washington’s leverage in the region.
The withdrawal of USAID could shift South Asia’s geopolitical balance, giving China an even stronger foothold. China’s increasing role as a foreign aid provider means that countries like Pakistan, Bangladesh, and Sri Lanka may find themselves increasingly reliant on Chinese economic aid.
Ukrainian President Volodymyr Zelenskyy arrived in Poland on Thursday following a summit of the European Council in Brussels....
The release of a new collection of documents by the U.S. Department of Justice has reopened long-running questions about how the Jeffrey Epstein case ...
The United States is not concerned about a potential escalation with Russia over Venezuela, Secretary of State Marco Rubio has said, as President Dona...
The U.S. military carried out large-scale strikes on dozens of Islamic State targets in Syria on Friday in response to an attack last week that killed...
US intelligence assessments indicate that Russian President Vladimir Putin continues to seek full control of Ukraine and to expand Russia’s influenc...
Nearly half of 1,100 metric tonnes of emergency food rations stored in a U.S. government warehouse in Dubai will be destroyed after reaching their expiry date. The aid remained unused following a freeze on funding introduced during President Donald Trump’s administration.
A USAID official and three business owners pleaded guilty to a 10-year bribery scheme involving at least 14 prime contracts worth over $550 million in U.S. taxpayer dollars.
The State Department office that handles refugee issues and works to cut illegal migration will deal with the U.S. response to overseas disasters, a role for which they say it lacks the know-how and personnel.
The U.S. State Department has handed over international disaster response duties to its refugee-focused bureau, sidelining USAID’s seasoned crisis teams.
Ukraine has welcomed the European Union’s decision to provide €90 billion in support over the next two years, calling it a vital lifeline even as the bloc failed to reach agreement on using frozen Russian assets to finance the aid.
European Union foreign policy chief Kaja Kallas has warned that attempts to reach a peace agreement in Ukraine are being undermined by Russia’s continued refusal to engage meaningfully in negotiations.
Chinese Foreign Minister Wang Yi has held a phone conversation with his Venezuelan counterpart Yvan Gil at the latter’s request.
Belarusian President Alexander Lukashenko has confirmed that Russian-made Oreshnik missile systems have been deployed on Belarusian territory and placed on combat alert.
The European Union has postponed signing its long-awaited free trade agreement with the Mercosur bloc until January, after failing to secure sufficient backing from member states, according to media reports.
The release of a new collection of documents by the U.S. Department of Justice has reopened long-running questions about how the Jeffrey Epstein case has been handled, what has been made public, and what remains undisclosed.
The United States is not concerned about a potential escalation with Russia over Venezuela, Secretary of State Marco Rubio has said, as President Donald Trump increases US military deployments in the Caribbean.
The U.S. military carried out large-scale strikes on dozens of Islamic State targets in Syria on Friday in response to an attack last week that killed American personnel, U.S. officials said.
US intelligence assessments indicate that Russian President Vladimir Putin continues to seek full control of Ukraine and to expand Russia’s influence in parts of Europe formerly under Soviet rule, contradicting repeated claims that Moscow poses no threat to the continent.
UN Secretary-General Antonio Guterres has issued a stark warning over the humanitarian situation in the Gaza Strip.
You can download the AnewZ application from Play Store and the App Store.
What is your opinion on this topic?
Leave the first comment