Home ›› 12 Dec 2021 ›› Front
Bangladesh’s poverty rate has fallen to a record low of 60 per cent – an enviable success for the country that was once crushed under the wheel of penury.
Success in agriculture, progress in industry, strong foreign exchange reserves, increase in remittances, expansion in exports and employment – all subscribed to the elimination of poverty immensely.
Faced with the decades of inequality under the regime of then Pakistani ruler, Bangladesh clinched freedom after a nine-month bloody war, but hunger and natural calamities were at its heels, and were a big challenge for the neophyte sovereign state to deal with.
But gone are those days; today a different picture has been sketched – a picture of development, with hardly any people dying of poverty or lack of food.
In the last 50 years, Bangladesh has made significant progress in many social and economic indicators.
According to the World Bank data, Bangladesh has made remarkable progress in reducing poverty, supported by sustained economic growth, demographic dividend, strong ready-made garment exports, and stable macroeconomic conditions.
Based on the international poverty line of $ 1.90 per person a day, extreme poverty declined from 44.2 per cent in 1991 to 12.9 per cent in 2017.
In parallel, life expectancy, literacy rates and per capita food production have increased significantly. Progress was underpinned by 6 per cent plus growth over the decade and reaching to 8.15 per cent in FY19.
Rapid growth enabled Bangladesh to get the lower middle-income country status announcement in 2015.
In 2018, the country met the eligibility criteria for graduation from the United Nation’s Least Developed Countries (LDC) list.
Now with a population of over 160 million, the country is one of the most densely populated lands in the world, but has garnered acclamation for achieving this unimaginable progress instead. The milestone for the country is to root out poverty by 2030.
The scenario of poverty dates back to the erstwhile Pakistan regime that treated this East part with an utter negligence, economic inequality and deprivation from 1947 to 1971. Although income was higher here, expenditure was more there in Pakistan.
In this regard, noted Economist Rehman Sobhan, Chairman, Centre for Policy Dialogue (CPD), said at liberation Bangladesh was well behind Pakistan in most areas of macro-economy and experienced levels of poverty and lower levels of human development in such areas as education and healthcare.
But over the course of 50 years after liberation the country has moved well ahead of Pakistan in most such areas, particularly in the last 25 years and more so in the last ten years, observed the analyst.
“We are no longer an aid-dependent country. Our aid-GDP ratio is now around 2 per cent whereas Pakistan requires periodic bailouts from the international community,” he pointed out.
“The economy has registered an impressive growth while poverty has reduced, but income inequalities and social disparities have widened.”
CPD Distinguished Fellow Prof Rounaq Jahan said in 1971 many outside observers doubted the viability of the new state, and some even called it ‘an international basket case’, but through hard struggle people could pull themselves up from poverty and by innovative actions unique to Bangladesh, the country has made steady progress in key indicators of human development during the first quarter century of independence.
“In recent years, Bangladesh’s success in maintaining high economic growth has drawn the attention of international agencies and the Western media. The country is now being called by some a development miracle and by some others a paradox which refers to Bangladesh’s record of sustaining high economic growth despite deficits in good governance,” according to the noted researcher.
“These brandings by the western media, whether positive or negative, are usually based on superficial understanding of the enormous changes that have taken place in Bangladesh over the course of the last 50 years.”
Success in poverty alleviation in five decades:
Poverty alleviation over the last decades smacks of a series of incidents. The 1970’s severe cyclone swept away everything in East Bengal killing about three lakh people, and subsequently the war ravaged the country. To overcome all these was a big challenge, but finally, Bangladesh could make it.
Economists say the poverty rate in the country was more than 80 per cent in 1971. According to the Bangladesh Bureau of Statistics (BBS), it was 83 per cent in rural areas and 81 per cent in urban areas in 1973-74.
In 1981-82, the rate dropped to 73.8 per cent in rural areas and 66 per cent in urban areas. In 1991-92, it was 58 per cent. A further decline was observed 48.9 per cent in 2000, 31.5 per cent in 2010 and 24.3 per cent in 2016 respectively. At present the poverty rate is 20.50 per cent.
The data suggests that Bangladesh was the second poorest country in the world after gaining independence.
The situation has further advanced in the following years. Now the per capita income is $ 2,554. After 1971, it was close to $ 100. In 50 years of independence, the per capita income has risen by at least 25 times.
The global economic downturn, rising food, energy and fertilizer prices, and growing trade deficits hit the economy hard. Loss of crops in 1974 and scanty flow of foreign aid pushed the country’s economy to the brink of collapse. As a result Bangladesh almost reached the brink of famine in 1974.
Later in the 80s when the garment industry began operation, exports rose, so was employment of both men and women that resulted in slowly turnaround of economy.
Despite the country’s progress, the floods in 1987 and 1988 again brought socio-economic catastrophe to Bangladesh. In the post-flood period, in 1988-89, there was a bumper crop that provided a cushion to the economy again.
Between 1991 and 2010, more than two crore people were lifted out of poverty. At that time the industrial and agricultural revolution of the country got underway.
Besides, foreign remittances and foreign direct investment gathered pace. In the early 1990s, many began to become self-sufficient through individual micro-credit activities.
A large number of local and foreign NGOs implemented various programmes in the country to alleviate poverty patronized by the government. Emphasis was also placed on safe water, sewerage and sanitation as well as family planning.
Poverty could never have been possible to be reduced without the family planning programme introduced by the government. At that time population growth rate was 3 per cent and poverty was the stumbling block to economic growth.
The family planning programmes and emphasis on growth and productivity came to the aid to cut poverty.
Since then vegetable cultivation particularly hybrid agriculture went up fetching a good yield. Hence, the country made great strides in increasing agricultural productivity, reducing infant mortality and alleviating poverty.
In the last one decade, the information and technology sector went through a paradigm shift. Many self-employed and new entrepreneurs have been established. The contribution of the private sector in the development of the country has increased considerably.
Bangladesh hopes to build a poverty-free country by 2030 by creating domestic and foreign investment, new entrepreneurs and employment, thereby achieving the sustainable development goals.
Economist Ahsan H Mansur, executive director at Policy Research Institute, said the country has advanced a lot in alleviating poverty in the last five decades. However, due to the pandemic, the poverty rate made a small rise, but now it is going down. Economic recovery is currently underway.
The researcher observed that Covid-19 has eaten up four years in total – two years for its raging and another two years for overall situation to return to the previous state, and if the deadly pathogen doesn’t revisit the world, the country will move on.
Noting that sustainable poverty reduction hinges on job creation, he said the government should make arrangements for employment to build a poverty-free Bangladesh.
“Aid does not cut poverty, it does give help only. It will be possible to get rid of poverty quickly if we focus on quality employment,” he suggested.
“For this we have to create environment for Foreign Direct Investment. If it increases, employment opportunities will rise. Besides, we need to pay attention to obsolete sectors, the potentials of which remain untapped, in order to create opportunities to increase investment and exports.”
At the same time, Mansur said there is no alternative to quality manpower that will enhance service quality and productivity.
“The country has an education system, but attention should be paid to increase quality education for skilled manpower,” held the researcher.
