In the immediate aftermath of the war of independence, the Muslim nations of the world mourned the blow to the sundered Pakistan, an avowedly Islamic state. For several years thereafter, Pakistan threatened to cut off diplomatic relations with nations that recognized Bangladesh, thus discouraging other Muslim states from helping the new nation. Mujib's socialist policies were not in tune with the viewpoints of most Muslim states, especially the conservative Arab states of the Middle East. Malaysia and Indonesia recognized Bangladesh in 1972, and after Pakistan did so in 1974, other Muslim countries eventually granted recognition and provided aid. The growing role of Islam in Bangladesh, symbolized by the adoption in 1988 of a constitutional amendment recognizing it as the state religion, indicated a major effort to widen ties with the Islamic world.

Bilateral ties between Bangladesh and the oil-rich Arab states were becoming increasingly important in the mid- and late 1980s. These ties had both economic and political components. The Arab states, especially Saudi Arabia, had become a growing source of development funds (mostly loans) since 1975, with much of the aid channeled into Islamic education and culture. The Saudis donated money for the construction of an Islamic university, mosques, and other religious centers, and Bangladesh exported labor to several Middle Eastern countries (see Balance and Terms of Trade , ch. 3).

Politically, Bangladesh supported the international policies of the Islamic nations of the Middle East. For example, Bangladesh strongly condemned Israeli policies and favored the creation of a Palestinian state. It supported the Palestine Liberation Organization under the leadership of Yasir Arafat, whose visit to Bangladesh in 1987 elicited a warm welcome from Ershad and other major government figures, as well as favorable press coverage. In 1987 the government reported that 8,000 Bangladeshi youths had volunteered to fight for the Palestine Liberation Organization. The government of Bangladesh, however, had made no official moves to send arms or personnel to Palestine as of mid-1988.

Bangladesh has expanded its ties with the worldwide Islamic community through the Organization of the Islamic Conference, a group of forty-five Muslim countries and eleven other nations with Muslim minorities. Bangladesh became a member of the conference in February 1974 and thereafter played a prominent role in setting up economic programs. The sixth annual meeting of the Islamic Development Bank and the Islamic Finance Ministers' Conference were held in Dhaka in 1985. In addition, Ershad attended the 1987 meeting of the Organization of the Islamic Conference in Kuwait, where nineteen Bangladeshi economic initiatives were accepted as joint ventures. Bangladesh was also part of a three-member committee trying to mediate an end to the Iran-Iraq War, and Ershad made several trips to the Middle East in an attempt to achieve peace.

Data as of September 1988