China has emerged as the winner against India in the battle for supremacy in the Bangladesh stock exchange.

After reports of India and China putting up bids in the Bangladesh stock exchange took everyone by surprise, an official told AFP that Bangladesh has agreed to sell a large stake to a Chinese consortium, disregarding India's bid.

China's Shanghai and Shenzen stock exchanges made a joint higher bid of 22 taka ($0.26) per share, or $122 million including "technical support worth nearly $37 million".

Reports had said earlier that the BSEC (Bangladesh Securities and Exchange Commission) had declined China's bid, however, stock exchange spokesman Shafiqur Rahman said on Monday that the board had "reconfirmed its decision" about approving the Chinese consortium's bid as it is higher than its nearest competitor.

India's National Stock Exchange had offered 15 taka ($0.18) per share for a 25 per cent stake in the Bangladesh stock exchange.

Bangladesh Securities and Exchange Commission had intervened in the bids which led to Transparency International, the Berlin-based corruption watchdog, issuing a statement "strongly condemning" what it called "unethical" and "illegal meddling".

There were reports which said India was set to win the bid despite quoting a lower price as the Indian government was closer to Sheikh Hasina's government.

The Indian government has approved several multi-billion dollar contracts to Bangladesh spurring growth and ensuring long-term interests and trade with its neighbour which came into existence after a bruising war with Pakistan in 1971.

However, as China entered the frame with higher bids and ambitions of extending trade in the region, New Delhi has increasingly felt nervous.

Now, with China winning round-1 in Bangladesh, India will be looking at other ways to secure its long-term interests with its close neighbour.

According to reports, the combined market capitalisation of companies listed on the Dhaka stock exchange is over $40 billion.

There were reports which said India was set to win the bid despite quoting a lower price.