BANGLADESH ECONOMY: A TALE OF MIRACLE
*** ”Moreover, some mega projects like Padma Bridge, Metro Rail, Nuclear power plant, Karnaphuli Tunnel, Expressway, Chittagong Coxes Bazar Railway, coal fired power plant in different location which are the symbol of future Bangladesh and would encourage the people to go with the entrepreneurship and new efforts.” ***
The performance of Bangladesh economy is considered one of the fastest growing economies in the world. In South Asia, Bangladesh has ranked 3rd after India and Bhutan in terms of annual GDP growth. A few years ago, Bangladesh was lagging behind Pakistan, but Bangladesh has now overtaken Pakistan. Bangladesh has overcome all challenges and defied all economic analysis with a steady progress in all indicators despite a sluggish world economy.Bangladesh economy has performed sustainable annual GDP growth in the last decade. During this period, economy has experienced a steady growth of over 6 per cent and exceeded 7 per cent per annum in Fiscal Year (FY) 2015-2016 and with an expected growth 7 per cent rate in FY 2016-2017 as per provisional assessment.
According to estimates released by the Bangladesh Bureau of Statistics (BBS), the economy grew by 7.1 per cent during FY 2016, compared to 6.6 per cent in FY 2015. In FY 2017, BBS provisionally estimated the GDP growth at 7.24 per cent.
In 2016, to the GDP, service and industry sector had a contribution of 53.1 per cent and 31.5 per cent respectively. On the other hand, the contribution of agriculture in GDP has decreased significantly. In 1990 the share of agriculture in GDP was 30 per cent and it came down to 15.4 per cent in 2016, whereas, the share of industry sector was only 7.70 per cent in 1990.
Consultancy firm PricewaterhouseCoopers (PwC) has predicted for Bangladesh to be among the top three fastest growing economies in the world by 2030. They have also said in a report that Bangladesh will overtake Malaysia within 2050 in terms of GDP and PPP. As per their report, Bangladesh ranked 31st among 32 world largest economies in 2016.
World Economic Forum (WEF) published an article where Bangladesh touted to be a next Asian Tiger after South Korea, Hong Kong, Taiwan, and Singapore.
Bangladesh has also performed significant progress in some social sectors. Reducing child mortality, increasing life expectancy level, eradication of poverty and hunger, higher enrolment and reducing dropout in primary education, empowering women are the example.
As per Human Development Report 2015, infant mortality rate in Bangladesh is 30.7 per thousand but in India it is 37.9 per thousand. Life expectancy at birth in Bangladesh 70 years, but in India it is 66.5 as per the same report. Under age 5, mortality rate in Bangladesh is 37.6 per thousand, but in India it is above 40.
Maternal Mortality Ratio (MMR) in Bangladesh in the 1990/91 was 574 per 100,000 live births, which was one of the highest in the world. According to Bangladesh Maternal Mortality Survey (BMMS), maternal mortality declined from 322 in 2001 to 194 in 2010, a 40 per cent decline in nine years. As per Human Development Report 2015, Bangladesh ranked 142 out of 187 countries in the Human Development Index.
Textile industry is a key factor in Bangladesh economic advancement with a whopping about 80 per cent share of total export earning, contribution of foreign remittance, pragmatic economic policy taken by the government through introducing several social safety net programmes for poverty alleviation, strong political determination for subsidizing in Agriculture and export sector, balanced socio economic programmes to cover vulnerable areas like northern district and for the extremely poor people, ambitious ADP allocation to implement big projects, rapid infrastructural development programme taken by the government to facilitate power, road, bridges and connectivity.
The upward trend in the development of living standard has brought forth a target of transforming Bangladesh into a middle income country within 2021. Bangladesh became a lower middle income country in 2015.
The per capita income of Bangladesh rose to USD 1602 in FY 2016-2017 which was USD 1466 in 2015-2016 and USD 1316 in 2014-2015 and USD 1190 in 2013-2015. The poverty level has also reduced significantly. In 1991-1992 poverty rates were 56.70, and 40.40 per cent in 2005, but substantially reduced in 2010 to 31.5 per cent and in 2015 it was 24.81 per cent.
In 2015 ultra-poor people were estimated at 6.50 per cent. To achieve the Millennium Development Goals (MDG), poverty reduction target was fixed at 1.20 per cent per year against which Bangladesh achieved 1.74 per cent.
There had been a common concern prevailing among some foreign and local analysts during ’70s, ’80s and ’90s about the economic future and stability of the country. This was also an assumption that the country will not be able to feed its people with its resources and would have to rely on the external sources to meet the demand for food and other essentials.
Moreover, authority failed to provide any visible or believable socio-economic plan or target encouraging the people. People only engaged themselves using their inherent capacity and entrepreneurship for their own existence and there was no goal in their mind how and how much they could contribute to their country.
Present ruling Awami League government is seen to visualize the prospect of the country to the people with some ambitious vision and mission to make the Bangladesh a middle-income country within 2021.
This has created some kinds of encouragement to the people and brought hope and aspiration which are very much required for them. Recently a national daily published a survey report showing that about 70 per cent of young respondents are satisfied with the state of the present economy.
Moreover, some mega projects like Padma Bridge, Metro Rail, Nuclear power plant, Karnaphuli Tunnel, Expressway, Chittagong Coxes Bazar Railway, coal fired power plant in different location which are the symbol of future Bangladesh and would encourage the people to go with the entrepreneurship and new efforts.
Sufficient energy, adequate infrastructure, eradication of corruption, good governance, people oriented administration, making easier for doing business and developing the best democratic practices will remain as challenges.
Recently, some of the economic indicators are showing negative trends. Workers remittance slowed down and achieved 14 per cent below the earnings of 2015-2016.
Export earnings of 2016-2017 have not met the target, though slightly higher than the previous year, flash flood in some districts during the Boro season may impact on rice production which may impact on food security temporarily. Some observers are predicting lower growth of export and remittance in the future.
However, in an economy, all the indicators might not behave similarly, but this does not indicate any immediate challenges. The instance of the abolishing quota system by the buyer countries on buying garments and collapse of Rana Plaza compelled observers to predict negative consequences but ultimately Bangladesh has succeeded in overcoming the situation.
Strong political commitment of ruling party towards economic development is necessary. With a pragmatic specific target of the government, people can also participate in the process of development. For example, the government has targeted to complete Padma Bridge within 2018 and expecting huge economic activities with the completion of this mega project.
People have been experiencing visible progress of the project and making their economic plan to have the benefit of the project. Padma Bridge is a good example how the new hopes and aspirations could create from an appropriate economic planning.
AUGUST 22, 2017