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Fascinating transformation of Bangladesh and her future challenges amid LDC graduation

Bangladesh, a country with 2.2% of the world’s population, has progressed to a level that has placed it on the world map as a ‘Role Model’ for development through prudent macroeconomic management of the government, tremendous efforts from the private sector along with exemplary resilience of the people to win over every odd. As data shows, the country’s GDP had been growing at a compound annual rate of 7.68% since its independence in 1971.

Once introduced as a basket case to the world, the country now earns a per capita GNI of $2,554. The total export of the country stood at $45.37 billion in June 2021, which is around 1.60 times its 2013’s figure reflecting a 5.3% compound annual growth rate. Total import of the country has also seen a phenomenal compound annual growth of 7.05% over the last 8 years, causing 2013’s import figure to grow to 1.70 times and reach $61.57 billion.

Figure 1: The visionary leadership of the PM along with tremendous efforts from the private sector has caused the nation to experience enviable development on the socio-economic front.

The visionary leadership of the Honorable Prime Minister along with tremendous efforts from the private sector has caused the nation to also experience enviable development on the socio-economic front. According to the World Bank, Bangladesh had around 40% of its people living below the poverty line.

This ratio has declined to around half and reached 24.3% within just 11 years. Malnutrition, often a bi-product of poverty and lack of education, is still high in the country. Studies indicate that a mother’s educational levels and family wealth have a significant negative relationship with moderate and severe malnutrition for her children.

Here comes the issue of female education. The country has had a tremendous development in child and female education, too. In 2016, 98% of all the children are getting enrolled in primary schools. Gender parity has also been achieved, of which 50.9% were girls. The enrolment ratio, however, drastically reduced at higher levels of education.

Figure 2: Average GDP Growth rate of Bangladesh at every 5-year intervals (Source: The World Bank, Forecast is based on authors’ calculation).

A comparative analysis of the Human Development Index (HDI) data of the UNDP, as shown in the chart below, clarifies that Bangladesh is ahead of India and Pakistan in terms of life expectancy. But, in terms of expected and mean years of schooling, the country is only ahead of Pakistan. Of course, the country is well behind in all the components of HDI compared to the developed nations (GNI is not included in the table since the primary focus of the comparison is non-monetary developmental issues of HDI).

Furthermore, the advancement in terms of quality education is still not good despite efforts from the Government and international organizations. Despite steps such as: numerous projects at the post graduate colleges of the country, development of selected private colleges with the help of information technology to improve the quality of education” scheme, Secondary Education Sector Investment Programme, Generation Breakthrough Project (Phase-II), and others, the Government failed to fulfill its objective to impart quality, modern and effective education at every level.

The Government has also adopted “Education Policy – 2010” with the objective of building thoughtful, rational, capable future leaders, secular, tolerant and patriotic citizens. Unfortunately, however, the policy itself is flawed in many dimensions to ensure that the objective is attained. For example, the policy offers a targeted student teacher ratio of 30:1, whereas the average of this ration in the USA is around 16:1 and the same in Malaysia and Singapore are around 11– 12:1. It is also clearly indicated in the policy that the actual value of this ratio is much higher than the target. Therefore, the students do not get appropriate attention and quality education at schools, colleges and even in the universities. Furthermore, UN data shows that more than 90% of the schools in Bangladesh do not have internet connections depriving the students of the opportunity to get free and high-quality educational materials.

Another important concern is setting the right objective for the education policy. Finland, for example, sets ‘Learning how to learn’ as one of their most important objectives for education, which primarily focuses on lifelong learning.

We are citing this example since Finland unarguably has the best education system in the world. Our progress, as mentioned earlier, is not negligible though, however, compared to Finland, we have a long way to go, but as a brighter future awaits us, it is always better to eye the best.

The transition of students from education to jobs is another major area of concern for us. The absence of elongated and quality apprenticeship, mentorship and internship programs alongside gaps between expected and achieved skills of the potential employees make the transition of graduates into the workforce difficult.

University’s job is to apply creativity to discover knowledge, to disseminate them and finally to ensure that the newly created knowledge is put into appropriate use. Unfortunately, this entire process seems to be absent in the country.

We can just disseminate knowledge in every wrong way possible due to the lack of proper training of the teachers in areas such as pedagogy and teaching-learning. Lack of access to quality research materials and software along with the lack of ability of the faculty members to conduct research works is barring the higher education institutes from producing new knowledge.

Action research is also completely absent in Bangladeshi social contexts. You would be probably wondering imagining the situation of developing new theories here. Only a handful of doctoral researchers develop new theories or contribute to theory through their extensive research activities.

Many of these people could not be retained in the country due to inappropriate social and organizational culture, structure, and lack of opportunities to further their careers.

We often fail to recognize the difference between a person conducting a basic survey with a researcher. Many renowned and prominent figures of the country say that researchers only develop theories. They are completely detached from the practical world.

With due respect to them, I must say that a theory is a hypothesis (or set of hypotheses) which are rigorously tested. Therefore, a theory does not become a theory unless it is practically applied. This is true in all areas of science including social sciences.

We have observed researchers who are continuously criticized for their research activities in many higher-degree providing organizations. Some of them are even offered junior positions and significantly lower salaries than their counterparts from other departments within the same organization since they are believed to be ‘Detached’ from reality and termed to have no political attachment.

Experiences related to going to the field and collecting data for a basic survey is given equal weight to a researcher with a proven track record to conduct peer-reviewed scientific research.

Therefore, researchers are demotivated to conduct further research and as we said earlier, most of them rather choose to leave the country or join non-research jobs in the country. The situation in academia is similar. Research is given the lowest priority in many universities. College and school teachers have hardly seen a proper research paper, let alone developing ones.

Lack of proper education and national as well as organizational policies to value education and distribute wealth– inequality had kicked in. We are, however, lucky that the inequality of the country has had a somewhat stable journey since 1995 (Figure 2).

The Gini Index hovered around 32 since then. Once compared with other peers as well as developed economies, we can say that Bangladesh has fared well in terms of inequality. We had the lowest value of the Gini index when compared against Vietnam, China, Sri Lanka and the USA (Table 2).

Therefore, it is only fair to conclude that the development of the country, at least as much as the data shows, were comparatively inclusive if compared against some selected economies. However, it is important to remember that as per the suggestions of the Inverted U hypothesis, inequality may increase with economic growth followed by a decline. Therefore, adequate policy supports are needed to ensure that it does not happen moving forward.

Figure 3: Gini trend of Bangladesh (World Bank Estimate).

Bangladesh has also had tremendous infrastructural development in the recent past. The nominal expenditure of the country in FY 2020 rose by 6.1% (y-o-y).

Table: 2 Comparative analysis of Gini index of selected countries.
Country Name Gini Index in 2016
Bangladesh 32.4
Vietnam 35.3
China 38.5
Sri Lanka 39.3
United States 41.1

Like all other sectors, this sector also has taken a hit from the COVID – 19 induced shocks. Development expenditure was reduced in the fourth quarter, as major infrastructure projects were also delayed due to the movement and travel restrictions. However, with the lifting of the lockdown and implementation of mass vaccination, normalcy is gradually returning.

In the most recent national budget, a few mega development projects like the Padma Multipurpose Bridge Construction, the Rooppur nuclear power plant construction; Hazrat Shahjalal International Airport Expansion, etc. have received the highest priority. Around US$ 5.5 Billion have been allocated in these projects so far.

These advancements of Bangladesh have offered its countrymen the pride of LDC graduation to be realized in the year 2026. The economy of the country has also become the 38th largest one in the world (in nominal terms) and the 30th largest in the world in terms of PPP (The World Bank).

The graduation, however, has brought about a plethora of challenges starting from loss of duty-free quota-free facilities, the requirement of export product and destination diversification, reduced access to grants and low-cost financing, unavailability of cash incentives and subsidies and unavailability of TRIPS waiver among many others.

The country is also vulnerable to climate change. These issues have placed the country in a challenging state requiring the think tanks, policymakers and researchers to identify probable remedies. Despite these challenges, it is needless to say that the ever-growing MAC consumer group, rising GNI, stable income inequality, high demographic dividends and lucrative incentives to the traders and investors of the world has surely made Bangladesh an attractive destination for world businesses.

The socio-economic picture of the country, as mentioned in this article, also presents ample opportunities for service sectors and non-profit organizations of the world to come and offer their services to fulfill their objectives.

In conclusion, we must say that policy supports from the Government, exemplary resilience of the people of the country alongside tremendous development of the private sector have induced a process of gradual transformation of Bangladesh from a wrongly placed identity of “Basket case” into the “Land of opportunities”. Quite a transformation indeed.

The authors:


Md. Kamrul Bari MIPA AFA is a qualified accountant and also a doctoral researcher at the IBA, University of Dhaka and Deputy Editor-in-Chief at the InternationalJournal of Management and Accounting (IJMA). He had been teaching Finance at several universities including AIUB for around 13 years. He left teaching as an Assistant Professor of Finance. Md. Kamrul Bari MIPA AFA can be reached at bari.sarkar@gmail.com.


Enamul Hafiz Latifee is a Policy & Trade Economist, Joint Secretary (Research Fellow), Bangladesh Association of Software and Information Services (BASIS). He can be reached at ehlatifee@gmail.com and viewed at www.ehlatifee.com.

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