Development Miracle

The country witnessed high growth volatility in the 1970s, as normal for a newborn country with policy switches. As per World Bank data, average growth in Bangladesh during that preparatory decade starting from 1973 was 4%. Growth sagged to almost 3% in the 1980s. However, the 1990s, along with liberalization, witnessed an average growth rate close to 5%, the 2000s close to 6%, and this exceeded to reach close to 7% in the 2010s. The country experienced growth-led development and a hike in per capita income. Rural Bangladesh was integrated more effectively with urban developments. Both female literacy and women’s labour force participation trended up, changing common perceptions about women. Public policies favoured the weaker gender to get into education and employment. Bangladesh’s female force made competent use of these opportunities. They are everywhere!

Population control was the most successful public policy Bangladesh ever had. The Mujib regime realized that the whole nation would sink into disaster unless population growth, which was above 3 percent then, was not pulled down. Now the country has almost one percent population growth, less than both India and Pakistan. The inception of liberalization since the early 1990s marked the start of a new era not only in reducing the financial hemorrhage of public enterprises, but also ushered in a new horizon of privatization and employment generation. The pace of privatization never slowed down since then. Rather, since the mid-1990s the economic openness, modernization and mushrooming of businesses accelerated at the beginning of each regime.

The Awami League since the end of 2000s thrived on four platforms: agricultural development, controlled population, demographic dividend and women empowerment. The other facet of the demographic dividend spreads over growing consumption, modern tastes, demand for digitization, increased migration and remittances. The rapid rise of the garments industry since the 1980s contributed to a solid foundation of export earnings, which, coupled with labour migration and remittances, gave the country a healthy reserve of foreign currencies. Imports went up not only for consumption, but mainly to provide raw materials, intermediate goods, and capital machinery – which eventually added booster doses to growth and public revenue. The banking sector played a pivotal role though the capital market and fiscal capability still remains anaemic.

The main weakness of the country is immature institutions which are often plagued with inefficiency and corruption. The slow-to-act bureaucracy, tardy judiciary, disproportionate law enforcement, archaic transport sector, improper construction works, poor tax collection, quality-deficient education, and an utter disregard for the environment are the challenges the current regime faces.

While improvements are evident, the speed of implementation is somewhat frustrating. Many mega infrastructure projects, which once completed, are supposed to change the functioning and features of the country but this does not happen. Bangladesh has entered a new era after graduating to a middle-income country. However, the signature infrastructural commitments of the current regime are designed to transform the country into a model of development in twenty years from now.

Bangladesh’s story is impressive in that many politicians and economists thought the country would be a paradigm of poverty. Bangladesh disproved it. The country’s public policies paid off. Much has changed and more will soon. Its ever-changing landscape now draws attention of developments thinkers. It’s not a miracle. It’s a success case of visionary public policies – most of whose seeds were sowed in recent decades.