Bangladesh at fifty has been moving confidently on the highway of development despite many highs and lows. The second wave of pandemic has certainly created a huge uncertainty in our society and economy. We braved the first wave quite well. Observers, both individual and institutional, were full of praises for Bangladesh’s amazing developmental journey during the past half a century defying all odds.
The World Bank raised our growth forecast for this year from 2 to 3.6 percent. Recently, UNESCAP also joined the fray. Based on a survey, the UN Regional body said that while the growth in the Asia-Pacific region could be 5.9 percent, it would be 7.2 per cent for Bangladesh in the current fiscal year. The results of this survey are close to what we expected (7.7 percent) in the Eighth Five-Year Plan. Since World Bank is known for its conservative forecasts, for them to improve their forecast is undoubtedly good news for us. However, this was done before the second wave of infections.The impact of the second wave of the Corona infection on our economy is bound to be significant. Bangladesh has started implementing a strong lockdown with huge implications for the small and medium entrepreneurs who provide the most employment opportunities to our low-income people. Wisely, the manufacturing units have been kept open. The hospitals are struggling to cope with this second wave and death figures are rising in major cities. The only credible response to this crisis is speedy vaccination. Given our population size and supply-side constraints, the desired vaccination drive may take time to overpower the surge of the virus. So, the uncertainty remains.
Another round of strong lockdown, hopefully, will give a strong message to those who have been extremely careless in taking health measures. It is true that low-income people, especially in the informal sector, will suffer because of the lockdown. With that in mind, the government could launch a hotline through which local administrations could deliver food aid to people in crisis.
In areas where the number of such people is high, the Tk10 per kg of rice program needs to be expanded. Last time this program turned out to be highly effective. Some local administrations have already started moving in this direction and people have been buying daily necessities from trucks and designated shops selling low-cost items.
Even after being vaccinated, we must maintain extreme caution. Keeping the ICU crisis in mind, everyone except those who require hospitalization should act responsibly now. Please make room for the more serious patients. Also, more emphasis should be placed on strict adherence to hygiene rules. In this situation, the selfless contribution of our doctors and concerned health workers must be appreciated more. I urge those concerned to come forward more actively to ensure the medical professionals’ safety, housing, incentives, and speedy immunisation. I also call on health sector organisations in the private sector to play a stronger role in the interest of humanity. All of society must combat this disaster. The government alone cannot do much. Bangladesh has an inherent fighting spirit. May we not lose it in the face of this challenge.
Imagine that dreadful time in 1972, right after the liberation war. The entire country was reduced to ashes. We were the second poorest country in the world. The size of our total economy was initially 6.3 billion dollars, which rose to 8 billion dollars at the end of 1972. The per capita income was only 93 dollars. Not a single dollar was there in reserve. Food crisis was omnipresent, with six to seven children per household. The birth rate was about 3 percent. The poverty rate was close to 80 percent. The average life expectancy was only 47 years. Not to mention the extreme malnutrition of children with swollen, empty bellies. Roads, railways, bridges, culverts, ports- all destroyed. There was the challenge of rehabilitating one crore refugees. At a time of such dire crisis, Father of the Nation returned to the country with a message of hope. As soon as he set foot in the country on January 10, 1972, he said in speech at Suhrawardy Udyan, “If the people of my Bengal are not fully fed, if the youth cannot work or do not find employment, our independence will be futile.” He reiterated these words in more detail on 9 May 1972 at the premises of Rajshahi Madrasa. He said, “What do I want? I want the people of Bengal be adequately fed. What do I want? I want Bengal's youth to get employed. What do I want? I want the people of Bengal be happy. What do I want? I want these people to laugh and move freely.” He added, “But sadly, the oppressors have left nothing. They even burned down all the banknotes, foreign currency. Believe me, the day I came and took over the government, I did not get a single penny of foreign currency.” Despite such poverty and shortages, Bangabandhu presented to his countrymen the dream of a golden Bengal. He nurtured a fighting spirit in everyone. And Bangladesh stood up.
Bangabandhu gave his Bangladesh the gift of a people-oriented, rights-based constitution, with the main pillars of nationalism, socialism, democracy, and secularism. His socialism was purely indigenous. The constitution is also an excellent document of inclusive development. It included various promises for the freedom of the people such as democracy, human rights, decentralization, free compulsory education, health and nutrition, women's empowerment, rural development, agrarian revolution, emancipation of workers, employment opportunities, meeting basic needs, co-operatives, coordination between the private sector and public sector, etc. To implement these basic aspirations in the constitution, he formulated the First Five-year plan to adopt a policy of balanced development of agriculture and industry. He initiated the green revolution for modernization of agriculture and nationalised the industrial sector to increase production in the absence of the entrepreneurial class.Alongside impatient youths in the country, senior politicians also did not give his ideas a chance. Resisting harsh criticism, sabotage, and various attacks to create social unrest, he was focused on creating a welfare state for all. The three principles of his inclusive development that still benefit us today were: 1. Rapidly reducing the rate of population growth by increasing social awareness and institutional capacity; 2. Continuously trying to achieve food self-sufficiency by increasing agricultural production with support for research and development and 3. Implementing primary education in every corner of the country with public funding. He made many other far-reaching policies including people-oriented public administration, autonomy of Dhaka University, formation of UGC, including agricultural graduates in cadre service and giving them first-class status, setting up agricultural research institutes like Bangladesh Agricultural Research Institute (BARI), Bangladesh Rice Research Institute (BRRI), and Bangladesh Agricultural Research Council (BARC), etc. He also gave enough space to non-state actors.
Bangabandhu wanted to build a corruption-free, mass welfare-centric society and administration. Instead of tweaking the old society, he took strong initiatives to build a new equal society through a second revolution. But vested interest groups did not give this leader of human liberation a chance to fulfill his dream. After running the country for only three-and-a-half years, he was physically taken away from his beloved countrymen on August 15, 1975. Yet he was and still is with the masses of this country. In just three-and-a-half years, he transformed the country with per capita income of 93 dollars into a country with that of 273 dollars. The quality of his leadership became evident soon enough, as the per capita income dropped to 138 dollars the year after his death. It took thirteen long years to achieve a per capita income equal to what it was in 1975 in his absence. It reached 271 dollars in 1988.
It took a long time for that lost in wilderness Bangladesh to find the right path. In 1996, after years of struggle, Bangabandhu’s daughter, the current Premier, received the responsibility of running the country. Her government moved the country forward even while tackling the devastating flood of 1998. However, the rhythm was interrupted again in 2001. With the slogan of Digital Bangladesh, she came back to power again in 2009, after eight long years of countless movements, imprisonment, and struggle. Maintaining the policy of liberalization, she has been giving ample importance to the private sector, while keeping the state fully focused on human development including education, health, and skill development.
As a result, impressive economic progress has been made during the last 12 years. About73 percent of the post-1975 growth rate has been achieved during this era. After 1975, remittances increased 285 times and exports 133 times. Per capita income has tripled in the last one decade. Reserves have increased almost sevenfold (44 billion dollars) in a decade. Recognition as a developing country came inevitably from the UN. Megaprojects including the Padma bridge and Metro-rail are in sight. These will have a huge positive impact on investment, employment, and poverty alleviation. With sufficient economic power, it was possible to announce and implement a stimulus equal to 4.4 percent of GDP to fight the economic slowdown induced by the pandemic. However, half of the Tk10,000 crore incentive for social security has not yet been implemented. Until the pandemic struck, poverty and extreme poverty had been reducing rapidly, but both started rising due to the health crisis. Fortunately, inflation has been kept under control (5-6 percent). In five decades, food production has quadrupled. Sixty percent of rural income is now coming from the non-agricultural sector. The quantity of health and educational services has been improving. However, the qualities of both remain questionable. Undoubtedly, more positive changes were imminent. But the pandemic has forced everything into disarray.
However, before the pandemic, the macroeconomic success was seen to have improved social indicators. The number of children per couple has come down to 2.1. The average life expectancy has increased from 65 years in 2005 to 73 years at present (The South Asian average is 68 years). Digitization has been a driving force behind this positive transformation. E-commerce has revolutionized trade and commerce. The market size of e-commerce is huge (200 billion taka). The digitization of government services, decentralization, and quality of services provided to the people have improved. Without this, the economy would have come to a grinding halt during the lockdowns. Moreover, the Eighth Five-Year Plan is paving the way for economic recovery. Around Tk 65 trillion will be required to implement the Plan. Most of this will be mobilized from domestic sources. Approximately 11.3 million jobs will be created during the planned period, invigorating domestic demand. Generating 30,000 MW of electricity will improve the quality of life. Eighty-one percent of the required investment will come from the private sector. Therefore, policy focus must continue to improve the business environment. Investment in education, health, and social security must be increased (this requires ensuring effective use of digital technology). Investment and policy focus on modernization and diversification of agriculture needs to be boosted as well. In addition to continuing the growth of the RMG sector, the ICT sector needs to emerge as a new engine of growth. The country's economy needs deeper linkage to local, regional, and global value chains. The policy priorities in infrastructure development need to be continued and enhanced if possible.
Immense potential is undoubtedly awaiting us. However, there are also many challenges ahead. We must keep in mind that enhanced tax collection and a competitive capital market will be our hope for long-term capital mobilization. Improving tax collection skills using digital technology should be given top priority. Along with the necessary reforms in the capital market, the bond and sukuk markets need to be activated in a real sense. The Bangladesh Security Exchange Commission has already started moving in this direction. But a lot more deserves to be done. Therefore, there is no alternative to the best practice of reporting and disclosures on capital market information to gain the confidence of investors. Expatriate Bangladeshis will be especially interested in our well-run bond market. Additionally, keeping the process of economic recovery green (i.e., environmentally friendly), digital and inclusive must be at the very center of policy drive.
Everything comes to a standstill because of bureaucratic complexity. Due to an extreme lack of coordination, resources are being left unused and wasted. So, the implementation trend must be constantly monitored. Above all, to ensure good governance, the anti-corruption stance of the top leadership must be reflected even in the grassroots level. If political stability and continuity are preserved while maintaining social peace, democratic participation, and justice, we will be able to reach the desired goal of becoming a prosperous country defying all challenges. However, defeating the pandemic must be our top priority now.
The author is a Bangabandhu Chair Professor at Dhaka University and former Governor of Bangladesh Bank. Contact: [email protected]