Despite remarkable strides over the past 50 years, socioeconomic inequalities persist in Bangladesh, leaving certain segments of the population marginalised and underserved, remarked experts and economists.
The affluent have seen rapid progress, widening the gap with the impoverished, who have experienced slower improvements, the experts highlighted — speaking at the launching event of a book "Fifty Years of Bangladesh: Economy, Politics, Society and Culture" held today (18 April) at Center for Policy Dialogue (CPD) office in the capital.
They attributed these disparities to institutional weaknesses and widespread corruption, leading to ineffective governance and inadequate funding for essential sectors like education, healthcare, and social welfare.
Workers, crucial to Bangladesh's economic growth, have been disproportionately affected by this resource shortfall, they said.
Key speakers at the event included Rehman Sobhan, Chairman of CPD, Executive Chairman of Power and Participation Research Centre (PPRC) Dr Hossain Zillur Rahman, former World Bank lead economist Dr Zahid Hussain, Dhaka University professor Dr MM Akash, and CPD Distinguished Fellow Professor Mustafizur Rahman.
Dr Rounaq Jahan moderated the discussions.
According to them, the main drivers of the economy in the last couple of years were labour-driven sectors like high yields of crops, manufacturing of readymade garments and expatriate remittances.
The economy should be transformed from labour-driven to technology and productivity and efficiency-driven to uplift the country to upper mid-level status and cope with the challenges that will arise after graduation from the LDCs.
Bangladesh has achieved significant development in the last five decades but the country has no functioning institution as everyone does not get the same treatment there, said eminent economist and the Founding Chairman of Centre for Policy Dialogue (CPD) Professor Rehman Sobhan.
“We are now emerging with a new system. On one hand, it is important for the state of governance and on the other hand it will impact development,” he added.
He emphasised the need for a new system, saying, “We are now emerging with a new system. On one hand, it is important for the state of governance and on the other hand it will impact development.”
He, however, expressed optimism about Bangladesh's potential for development, saying, “The nation is endowed with a populace rich in entrepreneurial flair, a valuable asset waiting to be fully harnessed. We can be a beacon of prosperity."
Former lead economist at the World Bank, Dr Zahid Hussain, observed that despite facing numerous adversities in the post-war period, Bangladesh has experienced significant prosperity, evidenced by increases in income per capita, decreases in poverty incidence, and the spread of human development.
He noted positive shifts in the structure of production and trade.
However, Zahid Hussain expressed concern about recent deviations from this trajectory, saying, “While numerous investments have poured in over the past few years, the primary motive behind these investments has not been genuine economic growth.”
He highlighted a trend where investors prioritise cultivating favourable relationships with the government, potentially hindering developmental progress by bypassing regulations.
He further remarked on the growth of the economy without a corresponding development of the institutional framework, raising concerns about the sustainability of this development.
He emphasised that Bangladesh will be the first test case of LDC graduation in the world.
Hossain Zillur Rahman said the economy became trapped in a cheap labour economy which is not sustainable.
Corruption is the source of super-rich groups. Earlier corruption was done to get benefits but corruption is done for protection, he added.
Professor Mustafizur Rahman echoed similar sentiments, stating that Bangladesh is trapped in the cycle of a cheap labour economy.
He emphasised the necessity of transitioning to a production, efficiency, and technology-based economy, saying, “We have to utilise our human resources, communication, infrastructure, and businesses in a three-dimensional way and become economic corridors from transport corridors.”
Professor Selim Raihan, executive director of the South Asian Network on Economic Modeling (SANEM) expressed his concern over the lack of institutional capacity, propensity for corruption and absence of coordinated business policy and urged a massive reform agenda.
He said that development came based on garment exports and remittance and both of the sectors are being operated through political settlement instead of business policy.
"Major improvements have to be made in the banking sector, taxation, and judiciary and for that political support is required,” he explained.
Despite the absolute poverty decrease in the economy, inequality has increased as well, said MM Akash.
“Bangladesh is both the fastest growing inequality and super-rich country,” he said quoting a World Bank report and termed the situation as contradictory.
The book 'Fifty Years of Bangladesh: Economy, Politics, Society and Culture' was published by Routledge, London, in November 2023.
According to Rounaq Jahan, the book introduces fresh empirical evidence alongside insightful analysis, providing a deeper understanding of the key processes, stakeholders, and initiatives that have shaped Bangladesh's evolution. It offers innovative perspectives to capture the complexities of Bangladesh's journey.
Structured into six sections, the book presents a comprehensive, interdisciplinary narrative covering the nation's economic and social transformation, political development, and evolving cultural landscape. It introduces new theoretical and analytical frameworks to illuminate the intricate and sometimes contradictory developments within the country.
