Industrialization in bangladesh

Abstract

This study attempts to study the problems and potentials of industrialization that face a

transition economy like Bangladesh from the historical perspective. Since the country like

Bangladesh is predominantly agriculture base and the limited industrial output and exports

also arise from the primary production the country face a stiff competition in the world market

to maintain and develop its terms of trade and balance of payment in its favor. The economy is

of much vulnerable as the industrial structure and output are not diversified enough and

hence suffers very often from the external shocks. This study, in this context, attempts to study

the structural bottleneck of the Bangladesh industry, its problems and suggests some policy

implications thereby.

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1.1: Introduction

Industrialization is the period of social and economic change that transforms a human group

from an agrarian society into an industrial one. It is a part of a wider modernization process,

where social change and economic development are closely related with technological

innovation, particularly with the development of large-scale energy and metallurgy production. It

is the extensive organization of an economy for the purpose of manufacturing. Industrialization

also introduces a form of philosophical change where people obtain a different attitude towards

their perception of nature, and a sociological process of ubiquitous rationalisation.There is

considerable literature on the factors facilitating industrial modernization and enterprise

development. Key positive factors identified by researchers have ranged from favorable political-

legal environments for industry and commerce, through abundant natural resources of various

kinds, to plentiful supplies of relatively low-cost, skilled and adaptable labor’s industrial

workers' incomes rise, markets for consumer goods and services of all kinds tend to expand and

provide a further stimulus to industrial investment and growth. The first country to industrialize

was the United Kingdom during the Industrial Revolution, commencing in the eighteenth

century. By the end of the 20th century, East Asia had become one of the most recently

industrialized regions of the world.

Objectives of study

The industrial sector has historically been the sector that has driven growth as countries have

moved from low to middle-income status. This is because industry can provide high-wage

employment for large numbers of workers and can raise social productivity by producing high-

value goods on a mass scale. Poor countries can earn valuable foreign exchange by exporting

manufactured products and the foreign exchange can be used to invest in newer machines and

technologies so that a rapid move up the technology ladder becomes possible. The average

productivity of industry is higher than in agriculture or most service-sector activities, so as

people move out of agriculture into industry, gross domestic production (GDP) increases.

Bangladesh as a country with a poor land-person ratio is unlikely to prosper through agricultural

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growth alone. Agriculture is unlikely to deliver rapid growth in Bangladesh because of the

difficulty of setting up large-scale farms that can compete with countries that specialize in

agriculture such as Australia or Argentina. Nor does Bangladesh have natural resources that can

be exploited, with the exception of natural gas. Thus, industrialization and specialization in

manufacturing is the obvious way in which Bangladesh can raise its per capita income and social

productivity. The industrial sector consists of manufacturing, together with utilities (gas,

electricity, and water) and construction.

Methodology and Limitation

The main purpose of my studies is to identity the contribution of economic development in our

country by Industrialization. There are many industries in our country that has contribution our

national development. But it has limitation, Bangladesh is industrially backward. Lack of

technological know-how, lack of resources, political instability, and infrastructural backwardness

are main obstacles to industrialization in our country. However, the country has some significant

advancement in small and medium level industries. Such as jut mills, fertilizer, steel mills,

textile mills, paper mills, machine tool factory, electrical industries, several sugar mills, leather

industries and cement factories, all of which are very big in respect of size, production and

investment, besides, hundreds of other smaller and mediocre industries that have been set up in

different parts of the country. Mention to be made of our garment industries earning huge foreign

exchanges and employing large number of unemployed, male and female.

Definition of Industrialization

The process in which a society or country (or world) transforms itself from a primarily

agricultural society into one based on the manufacturing of goods and services. Individual

manual labor is often replaced by mechanized mass production and craftsmen are replaced by

assembly lines. Characteristics of industrialization include the use of technological innovation to

solve problems as opposed to superstition or dependency upon conditions outside human control

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such as the weather, as well as more efficient division of labor and economic growth.

Industrialization is most commonly associated with the European Industrial Revolution of the

late eighteenth and early nineteenth centuries. The onset of the second World War also led to a great deal

of industrialization which resulted in the growth and development of large urban centers and  as well

as suburbs. Industrialization is an outgrowth of capitalism and its effects on society are still undetermined

to some extent, however it has resulted in a lower birthrate and a higher average income.

History of industrialization

Most pre-industrial economies had standards of living not much above subsistence, among that

the majority of the population were focused on producing their means of survival. For example,

in medieval Europe, as much as 80% of the labor force was employed in subsistence agriculture.

Some pre-industrial economies, such as classical Athens, had trade and commerce as significant

factors, so native Greeks could enjoy wealth far beyond a sustenance standard of living through

the use of slavery. Famines were frequent in most pre-industrial societies, although some, such

as the Netherlands and England of the seventeenth and eighteenth centuries, the Italian city states

of the fifteenth century, the medieval Islamic Caliphate, and the ancient Greek and Roman

civilizations were able to escape the famine cycle through increasing trade and

Commercialization of the agricultural sector. It is estimated that during the seventeenth century

Netherlands imported nearly 70% of its grain supply and in the fifth century BC Athens imported

three quarters of its total food supply.Industrialisation through innovation in manufacturing

processes first started with the Industrial Revolution in the north-west and Midlands of England

in the eighteenth century. It spread to Europe and North America.

Industrial revolution in Europe

Aplerbecker Hutted, an industrialized area of Dortmund, Germany circa 1910. The old town can

be seen beyond and some remaining agricultural land is in the foreground. In the 18th and 19th

centuries, the UK experienced a massive increase in agricultural productivity known as the British

Agricultural Revolution, which enabled an unprecedented population growth, freeing a significant

percentage of the workforce from farming, and helping to drive the Revolution. Due to the limited

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amount of arable land and the overwhelming efficiency of mechanized farming, the increased population

could not be dedicated to agriculture. New agricultural techniques allowed a single peasant to feed more

workers than previously; however, these techniques also increased the demand for machines and other

hardware, which had traditionally been provided by the urban artisans. Artisans, collectively called

bourgeoisie, employed rural exodus workers to increase their output and meet the country's needs. The

growth of their business coupled with the lack of experience of the new workers pushed a rationalization

and standardization of the duties the in workshops, thus leading to a division of labor, that is, a primitive

form of Faradism. The process of creating a good was divided into simple tasks, each one of them being

gradually mechanized in order to boost productivity and thus increase income. The accumulation of

capital allowed investments in the conception and application of new technologies, enabling the

industrialization process to continue to evolve. The industrialization process formed a class of industrial

workers who had more money to spend than their agricultural cousins.

Early Industrialization in Other Countries

After the Convention of Kanagawa issued by Commodore Matthew C. Perry forced Japan to

open the ports of Shimmed and Hakodate to American trade, the Japanese government realized

that drastic reforms were necessary to stave off Western influence. The Tokugawa shogun ate

abolished the feudal system. The government instituted military reforms to modernize the

Japanese army and also constructed the base for industrialization. In the 1870s, the Meiji

government vigorously promoted technological and industrial development that eventually

changed Japan to a powerful modern country. In a similar way, Russia suffered during the Allied

intervention in the Russian Civil War. The Soviet Union's centrally controlled economy decided

to invest a big part of its resources to enhance its industrial production and infrastructures to

assure its survival, thus becoming a world superpower. During the Cold war, the other European

socialist countries, organized under the Come-ons framework, followed the same developing

scheme, albeit with a less emphasis on industry. Southern European countries such as Spain or

Italy saw a moderate industrialization during the 1950s-1970s, caused by a healthy integration of

the European economy, though their levels of development, as well as those of Socialist

European Countries, do not match the more advanced standards of other European countries like

Germany.

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The Third World

A similar state-led developing programmed was pursued in virtually all the Third World

countries during the Cold War, including the socialist ones, but especially in Sub-Saharan Africa

after the decolonization period. The primary scope of those projects was to achieve self-

sufficiency through the local production of previously imported goods, the mechanization of

agriculture and the spread of education and health care. However, all those experiences failed

bitterly due to a lack of realism: most countries did not have a pre-industrial bourgeoisie able to

carry on a capitalistic development or even a stable and peaceful state. Those aborted

experiences left huge debts toward western countries and fuelled public corruption.

Industrialization in Asia

Apart from Japan, where industrialization began in the late 19th century, a different pattern of

industrialization followed in East Asia. One of the fastest rates of industrialization occurred in

the late 20th century across four countries known as the Asian tiger (Hong Kong, Singapore,

South Korea and Taiwan), thanks to the existence of stable governments and well structured

societies, strategic locations, heavy foreign investments, a low cost skilled and motivated

workforce, a competitive exchange rate, and low custom duties. In the case of South Korea, the

largest of the four Asian tigers, a very fast paced industrialization took place as it quickly moved

away from the manufacturing of value-added goods in the 1950s and 60s into the more advanced

steel, shipbuilding and automobile industry in the 1970s and 80s, focusing on the high-tech and

service industry in the 1990s and 2000s. As a result, South Korea became a major power. This

starting model was afterwards successfully copied in other larger Eastern and Southern Asian

countries, including communist ones. The success of this phenomenon led to a huge wave of off

shoring – i.e., Western factories or Tertiary Sector corporations choosing to move their activities

to countries where the workforce was less expensive and less collectively organized.

Industrialization in Bangladesh

Bangladesh was born in the background of utter industrial backwardness. At the time of her birth

she was so poor in the field of industry that almost all the industry products that the required had

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to imported from abroad. Though she holds the monopoly of jute, leather, and other raw

materials she was obliged both to export jute to other countries and buy from them finished

goods made with her raw materials. This tragic position lasted for years together.

To add to her difficulties, her population was entirely agricultural, inclined towards agriculture.

Her wealthy people, very few in numbers, were inclined towards commerce and had no idea

about industry. Over and above that she lacked those natural facilities which help the growth of

industry. She has no coalfield, no iron mine, no oil deposit and no natural source of power. And

starting with many barriers and a few advantages, Bangladesh has amazed the word by her

industrial progress in less than twenty years. The Government of Bangladesh played an

important role in the development of industries in this country. Right at the beginning, it came

forward and invited the wealthy people to invest money in industries under the protection and

patronage of the state. The industrial corporations undertook to organize a large number of

important industries where the investment is too heavy for private individuals. Some foreign

capital was invited and given attractive facilities. Granting the national capitals many advantages

encouraged the investment of national capital. Research laboratories have been set up to test raw

materials and improve the quality of local products. A vigorous campaign was launched to find

out new minerals and some important discoveries us actually made.As a result of this brisk and

all round effort for several years, Bangladesh can now boast of possessing a large number of

important industries. She has some jut mills, fertilizer, steel mills, textile mills, paper mills,

machine tool factory, electrical industries, several sugar mills, leather industries and cement

factories, all of which are very big in respect of size, production and investment, besides,

hundreds of other smaller and mediocre industries that have been set up in different parts of the

country. Mention to be made of our garment industries earning huge foreign exchanges and

employing large number of unemployed, male and female. To solve the problem of power

capacity of carnally hydroelectric project have been developed in addition to gas power station

set up in gohrashal and those are supplying cheap electricity throughout the whole of

Bangladesh. Gas is the most important aspect of our development of fuel. Natural gas is

abundant in the eastern section of the country. Many industries are run by gas. If properly

exploited, they can supply much power for industrial consumption.Born in the midst of absolute

vacuum. Bangladesh is going ahead speedily in the field of industrial progress. Her speeds will

immensely increases when all the sources of power will be properly utilized. And then the dream

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of her people to build up their country as one of the prosperous states of the world will be

realized in full. AN ARTICLE published in The Journal of European Economic History in 1982 says

that the per capita industrialization index of greater India went down from 7 to 2 during 1750-1913, based

on an index of 100 in the year 1900 for Great Britain. Industrialization was most likely despondent,

because of its colonial episode during industrial revolution period. After the departure of the British in

1947, the food-scarce country had no option but to concentrate on farming. Subsequently, the Bangladesh

government went for a socialist economic transformation in 1972 in order to break the peripheral

hegemony of capitalism. More than a thousand units of industries and abandoned properties were brought

under public entities. However, the state policy of socialism was quickly dumped after the assassination

of Sheikh Maribor Rahman.Upon contemplation of over-employment, managerial inefficiency, corruption

and heavy financial losses, state-owned enterprises were privatized under subsequent policies as reported

in an ILO study. The new government denationalized 255 SOEs during 1975-81. Indeed, the new

industrial policy of 1982 promoted capitalism and privatized another 222 SOEs until 1986. Nevertheless,

the losses of the SOEs increased to Tk 3.8 billion ($120 million) in 1986, as estimated by the finance

ministry. Subsequently, the revised industrial policy (1986) aimed to encourage foreign investment,

liberalize trade and raise incentives for private investors. However, the losses of the SOEs increased to

Tk 4.8 billion ($130 million) in 1991, as the privatization policy continued. Since its establishment in

1993, The Privatization Commission has so far privatized 74 SOEs. On the other hand, the Board of

Investment, after commencing in 1989, has encouraged private investment. Moreover, subsequent

industrial policies of 1999 and 2005 advocated a private sector-led market-oriented industrial

development.Industrial sector now contributes more than 28 per cent of the gross domestic product, from

around 11 per cent in the mid 1970s, according to the Bangladesh Economic Review. Its sub-sectors are

mining and quarrying, manufacturing, construction, and electricity, gas and water. Manufacturing

remained the largest sub-sector contributing to 17.3 per cent of the GDP in 2009-10. However, its growth

had been unsatisfactory until the 1990s, with a compounded rate of only 3.8 per cent, most likely due to

lack of confidence among capitalists about investment security. However, the private sector-led industries

marked double-digit growth in the mid 2000s, parallel to the peak in imports of capital machineries, from

$314 million in 1999-2000 to $1,929 million in 2006-07. Moreover, other sub-sectors experienced an

average growth of over 7 per cent during the past decade. The present private sector-dominated industry

will dominate the economy in 2021 with at least a contribution of 40 per cent to the GDP, as envisaged in

Vision 2021. Meanwhile, readymade garments became the largest manufacturing sector with a production

of 2,100 million pieces in 2010, up from 566 million in 1995, as per the BER. The quantum index of

industrial production measures the contribution of various industries to the economy. The QIP at base

year 1988-89 reached 1643.19 in 2010 for RMG. The sectors that performed well are pharmaceuticals

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producing 297,000 metric tons with QIP 1075.30, cement producing 2.9 million MT with QIP 836.42,

beverages producing 451 million bottles with QIP 555.44. These industries started privately without the

inherent pubic red-tape regulations and gained momentum from fiscal and monetary incentives. In

addition, the production of natural gas increased to 19.6 billion m3 with QIP 451.06 and the cotton yarn

to 181,000 MT with QIP 369.24. Other than the above, the private sector led soap and detergent industries

have done better than they are reflected from their QIP. On the other hand, leather and finished leather,

mill-made textiles, fertilizer, sugar and jute goods industries were seen vulnerable even in 2000s, because

of the combined effect of their slow deregulation and deep-seated governance problems.

Though a few industries have developed under the private sector, all pubic efforts, liberal policies and

attractive incentive packages (i.e. tax exemptions, tax holidays, concessionary duty on machinery imports,

repatriation of invested capital and profits etc) have failed to boost investments. The domestic capitalists

were not even convinced to invest at home. Rather, many of them were reportedly engaged in capital

flight in the 1980s. Moreover, many industrialists and businessmen used to maintain off-shore deposit

accounts like in Swiss Bank. The failure to bridge the gap between domestic and foreign private investors

was a major cause for slow industrialization. However, special incentives for foreign investment and

export-oriented industries kept a large flow of foreign investment into the export processing zones. By the

end of 2009-10, around $1,805 million were invested in eight EPZs coming from 33 countries. The BER

states that there are now 333 industrial units under operation and 82 units are under construction in the

EPZs, of which two-thirds are related to garments. The large industries are dominant, with their share of

51 per cent in 1973-74 and with two-third in early 2000s, according to the Bangladesh Bureau of

Statistics. This is as per the categories of large, medium and small industries based on labor absorption

and fixed capital endowment. Major business entities of the country, on the other hand, fall under the

small and medium enterprises, except for a few fertilizer factories, large garments, jute and textile mills,

pharmaceuticals companies, cement factories, telecom companies and some SOEs. Under many of the

SME programmers, the government, banks and financial institutions favor the medium and small

industries. In addition, the SME Foundation established in 2007 provides advocacy services along with

loan disbursement. Meanwhile, a refinancing scheme has been undertaken by the Bangladesh Bank since

2004-05. Moreover, IDA has provided $10 million and Bangladesh Bank has disbursed Tk10.42 billion,

as of June 2010, among banks and financial institutions for refinancing potential entrepreneurs. All such

efforts would promote small and medium industries to develop the industrial sector as a whole. Our

industrial sector has been through a history of slow growth, but a few industries, initiated and expanded

by the private sector, grew faster. Indeed, this growth has been very lopsided around the RMG with very

little diversification. As an agro-based country, the agro-processing industry has potential for rapid

expansion in this age of rapid urbanization. Moreover, some of the micro and high-tech industries will

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move forward because of the incentives provided for these two industries. The SME industries have the

advantage of low cost quality production and of producing for import substitution. However, even with a

very liberal policy framework, the poor infrastructure, political instability, bureaucratic red tapes and

underdeveloped legal system inhibit investment, either domestic or foreign. On the other hand, the

disincentive from the energy crisis would hold back the growth achieved recently. Exclusion of these

anti-growth factors is much needed to gain momentum for a typical leap of the industrial sector in

Bangladesh. Bangladesh is an underdeveloped country. The country is industrially backward.

Lack of technological know-how, lack of resources, political instability, and infrastructural

backwardness are main obstacles to industrialization in our country. However, the country has

some significant advancement in small and medium level industries. Many new and heavy

industries have also been set up at private enterprises which are remarkably contributing to our

national economy.

Problems of Industrialization in Bangladesh

Bangladesh is mainly an agricultural country. Agriculture has always been given priority and as

a result industries have been ignored. Recently some agro-based industries have been set up.

There are some reasons for which the country has lagged behind in heavy and medium-level

industries.

Lack of capital: Bangladesh being a poor country, people’s saving is very low. As saving is

very poor, investment is also very low. Again people’s per capita income is very low. So their

consumption is also very low. Consequently local market oriented industries are also very thin

here.

Weak investment base: due long colonial rule, economic discrimination and post-liberation

nationalization of industrialization, the growth of entrepreneurship has been slow in Bangladesh.

Besides, due to bureaucratic red-tapes and lack of investment climate, capital investment has not

been developed here.

Poor Infrastructure

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Infrastructural facilities in our country are also poor. Power supply, telecommunication,

transport, gas, water supply etc. – all facilities are poor which have hindered process of

industrialization in Bangladesh.

Technological know-how

Lack of technological know-how is also another reason of our industrial backwardness.

Lack of resources

Lack of raw materials and natural resources are also unfavorable for our industrialization.

Unskilled human resources

Though Bangladesh has a huge population, most of them are uneducated and unskilled. Country

lacks specialists, professionals and technologists which also hamper our industrialization.

Political instability and lack of proper govt. policy

A good govt. policy and political stability are precondition for industrialization. Unfortunately

political and instability has always been a common phenomenon here. Besides, no govt. have

planned or implemented an industry-oriented policy.

Industrialization: Current scenario

However, in recent times, Bangladesh has experienced a dramatic expansion in small and

medium level industries, particularly in ready-made garments and textile sector which have

boosted country’s economy greatly. In fact, garments sector has emerged as country’s largest

foreign exchange earning sector and provided employment opportunities to millions.( a short

story )  Moreover, Bangladesh has also greatly developed in fertilizer, sugar, cement, small and

light engineering, telecommunication, leather and agro-based industries.

Industrialization: Policies

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Bangladesh must develop and implement a good investment friendly environment so that foreign

direct investment increases here. We have also to set up new export processing zones improve

infrastructural facilities. Political stability must be ensured. Ore human resources should be made

skilled and more training and technical institute should be set up for this can encourage

privatization and give incentives on exported goods.

Industrialization Prospective of Bangladesh

The vision is to build Bangladesh into a resilient, productive, innovative, and prosperous nation

withal caring society consisting of healthy, happy, and well-educated people. It is built on the

enduring attributes of self-reliance, respect, tolerance, equity, and integrity. In line with

constitutional obligations and international human rights commitments, society in 2021 shall be

one in which (i)every citizen has equal opportunities to achieve his/her fullest potential; (ii) all

citizens enjoy equality of life commensurate with the national development stage where quality

health care and adequate nutrition are assured for all; (iii) all citizens are assured of a modern,

sound, and relevant education tailored to meet the human resource needs of a modern,

progressive, and technologically advancing nation; (iv) sustainable development is ensured,

along with optimal use of all resources; (v) there is respect for the principles of democracy, rule

of law, and human rights, ensuring gender equality, the rights of indigenous populations and of

all the other disadvantaged people including persons with disability and autism; and (vii) the

diversity and creativity of all people are valued and nurtured.

Macro-economic trend

This is a chart of trend of gross domestic product of Bangladesh at market prices estimated by

the International Monetary Fund with figures in millions of Bangladeshi Taka. However, this

reflects only the formal sector of the economy.

Year Gross Domestic Product US Dollar Exchange Inflation Index Per Capita Income

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(2000=100) (as % of USA)

1980 250,300 16.10 Taka 20 1.79

1985 597,318 31.00 Taka 36 1.19

1990 1,054,234 35.79 Taka 58 1.16

1995 1,594,210 40.27 Taka 78 1.12

2000 2,453,160 52.14 Taka 100 0.97

2005 3,913,334 63.92 Taka 126 0.95

2008 5,003,438 68.65 Taka 147

Mean wages were $0.58 per manhour in 2009.

Economic sectors

Agriculture

Most Bangladeshis earn their living from agriculture. Although rice and jute are the primary

crops, maize and vegetables are assuming greater importance. Due to the expansion of irrigation

networks, some wheat producers have switched to cultivation of maize which is used mostly as

poultry feed. Tea is grown in the northeast. Because of Bangladesh's fertile soil and normally

ample water supply, rice can be grown and harvested three times a year in many areas. Due to a

number of factors, Bangladesh's labor-intensive agriculture has achieved steady increases in food

grain production despite the often unfavorable weather conditions. These include better flood

control and irrigation, a generally more efficient use of fertilizers, and the establishment of better

distribution and rural credit networks. With 28.8 million metric tons produced in 2005-2006

(July–June), rice is Bangladesh's principal crop. By comparison, wheat output in 2005-2006 was

9 million metric tons. Population pressure continues to place a severe burden on productive

capacity, creating a food deficit, especially of wheat. Foreign assistance and commercial imports

fill the gap, but seasonal hunger ("monga") remains a problem. Underemployment remains a

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serious problem, and a growing concern for Bangladesh's agricultural sector will be its ability to

absorb additional manpower. Finding alternative sources of employment will continue to be a

daunting problem for future governments, particularly with the increasing numbers of landless

peasants who already account for about half the rural labor force. Due to farmers' vulnerability to

various risks, Bangladesh's poorest face numerous potential limitations on their ability to

enhance agriculture production and their livelihoods. These include an actual and perceived risk

to investing in new agricultural technologies and activities (despite their potential to increase

income), a vulnerability to shocks and stresses and a limited ability to mitigate or cope with these

and limited access to market information.

Manufacturing and Industry

Many new jobs - mostly for women - have been created by the country's dynamic private ready-

made garment industry, which grew at double-digit rates through most of the 1990s. By the late

1990s, about 1.5 million people, mostly women, were employed in the garments sector as well as

Leather products specially Footwear (Shoe manufacturing unit). During 2001-2002, export

earnings from ready-made garments reached $3,125 million, representing 52% of Bangladesh's

total exports. Bangladesh has overtaken India in apparel exports in 2009, its exports stood at 2.66

billion US dollar, ahead of India's 2.27 billion US dollar. Eastern Bengal was known for its fine

muslin and silk fabric before the British period. The dyes, yarn, and cloth were the envy of much

of the promoter world. Bengali muslin, silk, and brocade were worn by the aristocracy of Asia

and Europe. The introduction of machine-made textiles from England in the late eighteenth

century spelled doom for the costly and time-consuming hand loom process. Cotton growing

died out in East Bengal, and the textile industry became dependent on imported yarn. Those who

had earned their living in the textile industry were forced to rely more completely on farming.

Only the smallest vestiges of once-thriving cottage industry survived.Other industries which

have shown very strong growth include the chemical industry, steel industry, mining industry

and the paper and pulp industry.

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Textile sector

Bangladesh's textile industry, which includes knitwear and ready-made garments along with

specialized textile products, is the nation's number one export earner, accounting for 80% of

Bangladesh's exports of $15.56 billion in 2009. Bangladesh is 2nd in world textile exports, and

China which exported $120.1 billion worth of textiles in 2009. The industry employs nearly 3.5

million workers. Current exports have doubled since 2004. Wages in Bangladesh's textile

industry were the lowest in the world as of 2010. The country was considered the most

formidable rival to China where wages were rapidly rising and currency was appreciating. As of

2012 wages remained low for the 3 million people employed in the industry, but labor unrest was

increasing despite vigorous government action to enforce labor peace. Owners of textile firms

and their political allies were a powerful political influence in Bangladesh. The urban garment

industry has created more than one million formal sector jobs for women, contributing to the

high female labor participation in Bangladesh. While it can be argued that women working in the

garment industry are subjected to unsafe labor conditions and low wages, Dina M. Siddiqi argues

that even though conditions in Bangladesh garment factories “are by no means ideal," they still

give women in Bangladesh the opportunity to earn their own wages. As evidence she points to

the fear created by the passage of the 1993 Harkins Bill (Child Labor Deterrence Bill), which

caused factory owners to dismiss “an estimated 50,000 children, many of whom helped support

their families, forcing them into a completely unregulated informal sector, in lower-paying and

much less secure occupations such as brick-breaking, domestic service and rickshaw pulling.

Even though the working conditions in garment factories are not ideal, they tend to financially be

more reliable than other occupations and, “enhance women’s economic capabilities to spend,

save and invest their incomes. Both married and unmarried women send money back to their

families as remittances, but these earned wages have more than just economic benefits. Many

women in the garment industry are marrying later, have lower fertility rates, and attain higher

levels of education, then women employed elsewhere. After massive labor unrest in 2006 the

government formed a Minimum Wage Board including business and worker representatives

which in 2006 set a minimum wage equivalent to 1,662.50 taka, $24 a month, up from Tk950. In

2010, following widespread labor protests involving 100,000 workers in June, 2010, a

controversial proposal was being considered by the Board which would raise the monthly

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minimum to the equivalent of $50 a month, still far below worker demands of 5,000 taka, $72,

for entry level wages, but unacceptably high according to textile manufacturers who are asking

for a wage below $30. On July 28, 2010 it was announced that the minimum entry level wage

would be increased to 3,000 taka, about $43. The government also seems to believe some change

is necessary. On September 21, 2006 then ex-Prime Minister Khaleda Zia called on textile firms

to ensure the safety of workers by complying with international labor law at a speech

inaugurating the Bangladesh Apparel & Textile Exposition (BATEXPO).

Investment

The stock market capitalization of the Dhaka Stock Exchange in Bangladesh crossed $10 billion

in November 2007 and the $30 billion dollar mark in 2009, and USD 50 billion in August 2010.

Bangladesh had one of the best performing stock markets in the world during the recent global

recession; due to relatively low correlations with developed country stock markets. Major

investment in real estate by domestic and foreign-resident Bangladeshis has led to a massive

building boom in Dhaka and Chittagong. Recent (2011) trends for investing in Bangladesh as

Saudi Arabia trying to secure public and private investment in oil and gas, power and

transportation projects, United Arab Emirates (UAE) is keen to invest in growing shipbuilding

industry in Bangladesh encouraged by comparative cost advantage, Tata, an India-based leading

industrial multinational to invest Taka 1500 crore to set up an automobile industry in

Bangladesh, World Bank to invest in rural roads improving quality of live, the Rwandan

entrepreneurs are keen to invest in Bangladesh's pharmaceuticals sector considering its

potentiality in international market, Samsung sought to lease 500 industrial plots from the export

zones authority to set up an electronics hub in Bangladesh with an investment of US$1.25

billion, National Board of Revenue (NBR) is set to withdraw tax rebate facilities on investment

in the capital market by individual taxpayers from the fiscal 2010-11 market crash2011-12.The

bullish capital market turned bearish during 2010, with the exchange losing 1,800 points between

December 2010 and January 2011. Millions of investors have been rendered bankrupt as a result

of the market crash. The crash is believed to be caused artificially to benefit a handful of players

at the expense of the big players.

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External trade

Bangladeshi exports in 2006

The Bangladesh Garments Manufacturers and Exporters Association (BGMEA) has predicted

textile exports will rise from US$7.90 billion earned in 2005-06 to US$15 billion by 2011. In

part this optimism stems from how well the sector has fared since the end of textile and clothing

quotas, under the Multifibre Agreement, in early 2005.According to a United Nations

Development Programmers report "Sewing Thoughts: How to Realize Human Development

Gains in the Post-Quota World" Bangladesh has been able to offset a decline in European sales

by cultivating new markets in the United States. "[In 2005] we had tremendous growth. The

quota-free textile regime has proved to be a big boost for our factories," said BGMEA president

S.M. Fazlul Hoque told reporters, after the sector's 24 per cent growth rate was revealed.

Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) president Md Fazlul

Hoque has also struck an optimistic tone. In an interview with United News Bangladesh he

lauded the blistering growth rate, saying "The quality of our products and its competitiveness in

terms of prices helped the sector achieve such... tremendous success."Knitwear posted the

strongest growth of all textile products in 2005-06, surging 35.38 per cent to US$2.82 billion. On

the downside however, the sector's strong growth came amid sharp falls in prices for textile

17

products on the world market, with growth subsequently dependent upon large increases in

volume. Bangladesh’s quest to boost the quantity of textile trade was also helped by US and EU

caps on Chinese textiles. The US cap restricts growth in imports of Chinese textiles to 12.5 per

cent next year and between 15 and 16 per cent in 2008. The EU deal similarly manages import

growth until 2008.Bangladesh may continue to benefit from these restrictions over the next two

years, however a climate of falling global textile prices forces wage rates the centre of the

nation's efforts to increase market share. They offer a range of incentives to potential investors

including 10 year tax holidays, duty free import of capital goods, raw materials and building

materials, exemptions on income tax on salaries paid to foreign nationals for three years and

dividend tax exemptions for the period of the tax holiday. All goods produced in the zones are

able to be exported duty free, in addition to which Bangladesh benefits from the Generalized

System of Preferences in US, European and Japanese markets and is also endowed with Most

Favored Nation status from the United States. Furthermore, Bangladesh imposes no ceiling on

investment in the EPZs and allows full repatriation of profits. The formation of labor unions

within the EPZs is prohibited as are strikes. Bangladesh’s exports to the U.S. surpassed $1.9

billion in 1999. Bangladesh also exports significant amounts of garments and knitwear to the EU

market. Bangladesh also has significant jute, leather, shrimp, pharmaceutical, and ceramics

industries. Bangladesh has been a world leader in its efforts to end the use of child labor in

garment factories. On July 4, 1995, the Bangladesh Garment Manufacturers Export Association,

International Labor Organization, and UNICEF signed a memorandum of understanding on the

elimination of child labor in the garment sector. Implementation of this pioneering agreement

began in fall 1995, and by the end of 1999, child labor in the garment trade virtually had been

eliminated. The labor-intensive process of ship breaking for scrap has developed to the point

where it now meets most of Bangladesh's domestic steel needs. Other industries include sugar,

tea, leather goods, newsprint, pharmaceutical, and fertilizer production. The Bangladesh

government continues to court foreign investment, something it has done fairly successfully in

private power generation and gas exploration and production, as well as in other sectors such as

cellular telephony, textiles, and pharmaceuticals. In 1989, the same year it signed a bilateral

investment treaty with the United States, it established a Board of Investment to simplify

approval and start-up procedures for foreign investors, although in practice the board has done

little to increase investment. The government created the Bangladesh Export Processing Zone

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Authority to manage the various export processing zones. The agency currently manages EPZs in

Adamjee, Chittagong, Comilla, Dhaka, Ishwardi, Karnaphuli, Mongla, and Uttara. An EPZ has

also been proposed for Sylhet. The government has given the private sector permission to build

and operate competing EPZs-initial construction on a Korean EPZ started in 1999. In June 1999,

the AFL-CIO petitioned the U.S. Government to deny Bangladesh access to U.S. markets under

the Generalized System of Preferences (GSP), citing the country's failure to meet promises made

in 1992 to allow freedom of association in EPZs.Sylhet is fast becoming a major center of

retailing in Bangladesh with many shopping centers being built by expatriates to serve fellow

expatriates visiting Sylhet and the emerging middle class. Many of these developments hark back

to Britain.

Bangladeshi Women and the Economy

“Bangladesh is a highly patriarchal society (as are many countries in the region) with gender

being a key factor in defining social roles, responsibilities and power relationships within the

family and workplace. Male workforce participation is significantly higher than female

participation, with men participating at 83 percent and women at 59 percent; however, male

workforce participation has decreased by 4 percent, while female participation has increased by 4

percent from the year 2000. It should be noted that a 59 percent female participation rate is high

in comparison to a lot of countries like Iran, which has a 16.5 female labor participation rate

(World Bank 2010), and Lebanon, which has a 22.5 female labor participation rate.

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A 2007 World Bank report stated that the areas in which women’s work force participation have

increased the most are in the fields of agriculture, education and health and social work. Over

three-quarters of women in the labor force work in the agricultural sector. On the other hand, the

International Labor Organization reports that women's workforce participation has only

increased in the professional and administrative areas between 2000 and 2005, demonstrating

women's increased participation in sectors that require higher education. Employment and labor

force participation data from the World Bank, the UN, and the ILO vary and often under report

on women's work due to unpaid labor and informal sector jobs. Though these fields are mostly

paid, women experience very different work conditions than men, including wage differences

and work benefits. Women’s wages are significantly lower than men’s wages for the same job

with women being paid as much as 60-75 percent less than what men make. One example of

action that is being taken to improve female conditions in the work force is Non-Governmental

Organizations. These NGOs encourage women to rely on their own self-savings, rather than

external funds provide women with increased decision-making and participation within the

family and society. However, some NGOs that address microeconomic issues among individual

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families fail to deal with broader macroeconomic issues that prevent women's complete

autonomy and advancement.

Overview

The area of Gulshan is a commercial hub of the country

Karwan Bazaar is home to many of Bangladesh's important offices

Bazaars in Bangladesh are popular trading places for everyday household necessities.

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Bangladesh has made significant strides in its economic sector performance since independence

in 1971. Although the economy has improved vastly in the 1990s, Bangladesh still suffers in the

area of foreign trade in South Asian region. Despite major impediments to growth like the

inefficiency of state-owned enterprises, a rapidly growing labor force that cannot be absorbed by

agriculture, inadequate power supplies, and slow implementation of economic reforms,

Bangladesh has made some headway improving the climate for foreign investors and liberalizing

the capital markets; for example, it has negotiated with foreign firms for oil and gas exploration,

better countrywide distribution of cooking gas, and the construction of natural gas pipelines and

power stations. Progress on other economic reforms has been halting because of opposition from

the bureaucracy, public sector unions, and other vested interest groups. The especially severe

floods of 1998 increased the flow of international aid. So far the global financial crisis has not

had a major impact on the economy. The World Bank predicted economic growth of 6.5% for

current year. Foreign aid has seen a decline of 10% over the last few months but economists see

this as a good sign for self-reliance. There has been 18% growth in exports over the last 9

months and remittance inflow has increased at a remarkable 25% rate.

Fiscal Year Total Export Total Import Foreign Remittance Earnings

2007–2008 $14.11b $25.205b $8.9b

2008–2009 $15.56b $22.00b+ $9.68b

2009–2010 $16.7b ~$24b $10.87b

2010–2011 $22.93b $32b $11.65b

2011–2012 $24.30b $35.92b $12.85b

Some Key Targets based on Vision 2021

• Secure and sustain an annual rate of GDP growth of 8 per cent by 2013, which will increase to

10 per cent from 2017.

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• Bring down the proportion of disadvantaged people living below the poverty line to 25Million,

i.e. 15 per cent by 2021.

• Ensure a minimum of 2,122 k.cal/person/day of food for all poor people and standard

nutritional food to at least 85 per cent of the population by 2021.

• Ensure 100 per cent net enrolment at primary level as soon as possible after 2010, provide free

tuition to degree level as soon as possible after 2013, attain full literacy as soon as possible after

2014, and ensure that Bangladesh is known as a country of educated people with skills in

information technology.

• Achieve self sufficiency in food by 2012.

• Ensure living accommodation for the entire population as soon as possible after 2015; supply of

pure drinking water for the entire population as soon as possible after 2011, and bring each house

under hygienic sanitation by 2013.

• Eliminate all contagious diseases and increase life expectancy to 70 years by 2021.

• Reduce maternal mortality to 1.5 per cent, raise the use of birth control methods to 80per cent,

and bring down infant mortality to 15 per thousand live births by 2021.

• Change the sect oral composition of output with the shares of agriculture (primary), industry

(secondary), and services (tertiary) standing at 15 per cent, 40 per cent, and 45per cent

respectively in 2021.

• Reduce the unemployment rate to 15 per cent; change the shares of agriculture, industry, and

services in employment to 30 per cent, 25 per cent, and 45 per cent respectively in 2021.

• Generate 8,500 megawatts of electricity by 2013, which will increase to 11,500megawatts in

2015, and make provisions to meet the expected demand for power of20,000 megawatts in

2021.The Plan envisages that every member of society will enjoy a standard of living

comparable to those of middle income and high HDI countries, with access to quality education

and healthcare regardless of socioeconomic standings, religion, or gender. Poverty will be

eradicated and people will live in communities where benefits will extend beyond the basic

necessities of food, clothing, and shelter to ensure creative and fulfilling lives. The role of the

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public sector will be to provide infrastructure and basic public goods and create an enabling

environment for the private sector to act as the engine of economic growth. The government will

be service-driven through cost-effective public sector delivery systems and social services fully

enabled by adoption of modern technology. Governance will be guided by effective political and

legislative institutions, protection of human rights, transparency and accountability in the

establishment and enforcement of the rule of law, ethical conduct, value-focused decision-

making, and timely and efficient resource allocation. The government will listen to and provide

feedback to people through e-governance and public forums, among other media. It will function

with the highest standards of public accountability, participation, consistency, and integrity. Such

governance standards will provide the context for the operation of all public and private

sectorinstitutions.The private sectors will develop globally competitive enterprises. They will

deliver goods and services that meet domestic demand efficiently and capture a rising share of

exports in the global market. The private sector will be empowered by a strong spirit of

entrepreneurship and supported by risktolerantfinancial institutions and legal systems that

actively encourage business start-ups. The Development of micro, small, and medium enterprises

will encourage women entrepreneurs. The private sector will also develop social responsibility to

play a positive role in social and nationaldevelopment.Both the public and private sectors will

collaborate effectively and efficiently through public private partnerships (PPP) and other

innovative models to deliver infrastructure, utility and other services inane environment-friendly

manner. Bangladesh will emerge as a country with sustainable and inclusive economic growth. It

will become a country that has diversified industrial and technologically advanced service sector

activities based on a strong foundation of agriculture. The economy and national development

will be effectively managed, with the government ensuring macroeconomic stability and creating

right incentives, and the private sector providing the direction and impetus for new investments

to raise the level of outputs and employment.

A Resilient Democratic Nation

Born from the great Liberation War of 1971, Bangladesh is a non-communal, progressive,

democratic state that has worked to establish an economy and society free of inequality, and to

nurture a culture of democracy and respect for human rights for all fostered by patriotism in all

24

areas of social existence. Along with a tolerant democracy, the aspiration is for a more caring

society based on a system of values rooted in the culture and traditions of Bangladesh. The

country’s value system will develops it progresses, and the values will translate from collective

to individual perspectives creating collective drive to work together towards national

development. Bangladesh’s heritage, rich in content and diversity, shall have a place in our

present and be the anchor for the country’sambitions.Promoting democratic culture Nurturing

political maturity and a culture of democracy will enable the country to gain greatersocio-

economic benefits during the Plan period. Political maturity will come through greater tolerance

and cooperation in politics through mutual respect and trust. The election process wills beamed

still more credible and effective. Parliament shall be turned into the centre of all power and

decision making. Members of Parliament will be responsible for law making and ensuring

governmental accountability to the people. The Parliamentary Standing Committees will be

made more effective. Right to information and free mediate free flow of information on the

government’s financial transactions and records, except those which involve national security

and criminal investigation, will be made available under the Right to Information Act 2009. This

will require all public officials, including the elected, to provide annual information on their state

of income and wealth. This will be an important component of Digital Bangladesh under the

Vision 2021. Further independence of the media, both electronic and print, shall be ensured.

Independence of the judiciary the separation of the judiciary from the executive has already been

achieved. What remains to be done is to ensure the full complement of judges at all levels,

separate investigation and prosecuting wings to enable the judiciary to carry out their duties

without interference. Independence of the judiciary will be supplemented by monitoring and

supervising the judicial process. Improved training of the lower judiciary and further legal

education for lawyers will increase the judiciary’s efficiency. To expedite justice in rural areas,

alternative dispute resolution will be brought under the supervision of judicial magistrates.

Respected local civil society members will be called upon to contribute to conflict resolution in

rural areas through negotiation in pre-trial courts.

Promoting Gender Balance

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In a continued Endeavour to ensure gender balance as enshrined in the Constitution’s

Fundamental Rights and Principles for Administration of the State chapters, the government

introduced a separate quota for women in Parliament. The quota system for women also applies

to public services, and the Bangladesh Jatiyo Moheela Sangstha was formed. Other similar

measures were introduced to empower and mainstream women in national life.

Institutionalization of gender responsive planning and a budget promoting gender balance is also

in progress. The National Policy for Women’s Advancement 1997 provides for the elimination

of all forms of discrimination against women, equal rights of inheritance to property and equal

partnership in development. The Plan will give women their rightful share in skills development

training both at home and abroad, and will improve professional excellence. The CEDAW

Charter will be ratified without reservation. All laws relating to gender inequality will be

reviewed to ensure gender sensitive good governance, security at home and in the workplace, the

rule of law, transparency and accountability in all public and private organizations in an

inclusive society. The Plan will provide incentives for women to pursue vocational higher,

secondary and tertiary education and to obtain the necessary training that allows them to compete

on equal terms in the job market and also become entrepreneurs. The availability of institutional

collateral free credit to women entrepreneur for setting SMEs could be an important step for

encouraging women in this venture. A separate bank for Women may be established for

supporting women entrepreneurs and traders. Special consideration will be given to appointing

women candidates to key and statutory bodies such as the PSC, SEC, Election Commission,

ACC, BTRC, PERC, Bangladesh Bank, UGC, the higher judiciary and other strategically

important sectors and positions. One-third of nomination of candidates to all national and local

level elections may be reserved by all the parties contesting the elections. And one-third of the

office bearers of all registered political parties will have to be filled by women. The feasibility of

incorporating into GDP calculations the value added by women in the household, kitchen garden

and similar other activities will be examined by experts. Due attention will be given to enhancing

the economic participation rate of women from 29 per cent to at least 40 per cent by 2021.

The Model for Achieving Middle Income and high HDI Country Status

26

If Bangladesh is to achieve middle income country and high HDI status by 2021, it will have to

address the multi-faceted and complex concerns of development, involving economic factors as

well as social, cultural, and political aspects. There are changing dynamics in the interactions

between these factors that also need to be taken into account in assessing the outcomes. For the

sake of simplicity, the basic assumption adopted in the model is that the level of economic Well-

being, as measured by national income per capita, is a prerequisite for development; and that the

level of per capita income is correlated with several key non-economic factors which define

Middle income and high HDI country status. The model is supported by a technical framework

capable of analyzing poverty, distribution, and the social implications of the income growth

scenario1 these results are used to define the growth path that will lead Bangladesh to a middle-

income and high HDI country by 2021. Development priorities are sharpened further by these

considerations and drivers of change.

Development Priorities

Development priorities are distilled from the vision statement and therefore have close links with

where Bangladesh will be in the year 2021. The goal is to promote an equitable society as a basis

for social and political stability and the achievement of national unity. There will be poverty

eradication, gender equality, balanced regional development, and an inclusive society with

workers’ rights and responsibilities firmly established. The path to poverty reduction will

promote broad-based growth and actions in distributive justice to reduce inequality in the

distribution of income and wealth. An employment generating linkage through micro, small and

medium enterprise will create a vehicle for income generation-cumpovertyeradication – not just

for poor people, but also those with disabilities and autism as well as indigenous people. The

provision of universal socio-economic-cultural safety nets, or social protection, including

targeted programmers will be a part of the government policy to ensure inequitable society as the

country climbs the ladder to higher economic growth. The equal rights of women and men, and

measures to bring advancement to society’s left-behind groups are also components of the equity

agenda. Policies will explicitly recognize that women’s poverty has different dimensions and is

generated through complex processes that need specifications. Poverty reduction of women

requires holistic strategies for gender equality, which includes safety net programmers for the

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female-headed households along with appropriate skill training supported by micro-credit. A

women-friendly health system is required that can effectively cater forth differential needs of

women. The Perspective Plan aims to create a more inclusive and equitable society characterized

by human rights and equal opportunity for all. It will work to ensure that every person, regardless

of gender, age, race, class, caste, ethnicity, religion, or geographical location, can enjoy equal

opportunity and rights, making development a process that actively includes all the people that

have been excluded to date. In order to achieve the desired society, cultural, religious, and ethnic

diversity has to be promoted as national heritage through pursuance of policies for cohesion and

inclusion of the ethnic, religious, and cultural minorities into a national and social force. The

civil society will be encouraged to launch cultural movement for integrating the Dalits, Harijon,

Antaja, tea garden workers, indigenous, people with disability and autism, and other socially

disadvantaged and stigmatized groups into the mainstream of the society. All forms of

discrimination against the socially excluded groups will be eliminated and their human rights and

citizenship rights be established. The full implementation of the 1997 Chittagong Hill Tracts, the

Bangladesh Disability Welfare Act and making Land Commission effective will be a move in

this direction.

The Development Priorities of the Perspective Plan Are

1 The technical framework consists of four linked models: (i) a macroeconomic framework

containing five accounts delineating the economy to generate a consistent macroeconomic

outlook over the Plan period; (ii) a dynamic computable general equilibrium model into which

the key outcomes of the macroeconomic framework are fed to allow the sect oral implications to

be calculated; (iii) an employment satellite matrix in which sect oral value additions/outputs are

linked to calculate employment impacts; and (iv) a distribution and poverty module in which

household income, consumption, and relevant information from the above models are linked to

assess poverty situations and distributional implications.

• Ensuring effective governance.

• Promoting an innovative people for digital Bangladesh.

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• Creating a caring society.

• Addressing globalization and regional cooperation challenges.

• Ensuring broad-based growth and food security.

• Providing energy security for development and welfare.

• Building a sound infrastructure.

• Mitigating the impacts of climate change.

These thematic approaches will shape and form the foundation on which strategies are developed

for the overarching vision that will guide policy development, and place the strategies

inappropriate relational contexts. While development priorities are elaborated in the following

chapters, it is clear that the nation needs to harness all its resources and skills, and ensure their

prudent use in the strategy’s implementation. It is also important to recognize that an integrated

approach will be necessary to move forward in each priority area, because these crosscutting

areas are underpinned by culture, diversity, and physical differences. The combined efforts of

public and private sectors will be needed to create the critical mass necessary to support the

development efforts. Effective governance is the strongest means to achieving the goals of the

Perspective Plan. The administration of justice, good governance, effective institutional

structures for development, law administration and legal affairs, national security, and public

safety are essential for fair contracts, dispute resolution, promotion of entrepreneurship, and to

encourage businesses and individuals to take risks. Without upholding rights and adhering to

basic tenets of justice, the poor and disadvantaged groups will remain unable to take economic

and social opportunities for economic growth. Effective governance will employ public

resources efficiently in activities with high social returns, will strengthen public institutions,

minimize corruption, terrorism, and extortion, encourage citizens to develop greater respect for

the authority and rule of law, and stimulate the private sector to take socially responsive

decisions an innovative people will be the foundation of the envisioned society. These

individuals will acquire appropriate knowledge, skills, and abilities through a strong learning

system consisting of preprimary, primary, secondary, and tertiary education; skills development

and training; and application of research, science, technology, and innovation. Innovation will be

29

fostered in education and at work; and the innovative people will value the dignity of work,

accept risk, and will emerge as lifelong learners. They will identify problems and seek solutions,

thereby improving the economy’s competitiveness. Creative citizens will underpin Bangladesh’s

journey to middle income and high HDI country status by 2021.The creation of this innovative

people will demand vast information technology efforts and computer technology during the

Perspective Plan period. ICT will be the vehicle through which a Digital Bangladesh will be

created. This will raise efficiency and productivity across all sectors of the economy, including

agriculture, health, education, training, and e-governance, and will help to bring greater

transparency in governance. A caring society will nurture the seeds of progression and

patriotism. It will compel individuals, communities, and institutions to move forward to stamp

out poverty, discrimination, economic and social marginalization, disease and poor health, and

sub-standard living conditions. This will create new possibilities and take advantage of existing

ones for the communities to work collaboratively with trust, goodwill, integrity, and civic pride

so that none is left behind. Nurturing such a society requires actions in the related areas of health,

housing, labor and social security, gender and development, youth and culture, sports and

recreation, sustainable communities, and socialservices.Addressing globalization and regional

cooperation challenges are important for Bangladesh to sustain increases in the quality of life

through productivity and income growth. Instituting a prudent macroeconomic policy framework

conducive to achieving high economic growth with stability; ensuring the availability of, and

access to, appropriate financial services and entrepreneurship in agriculture, industry and

services; promoting international relations, regional and sub-regional cooperation, and trade; and

expanding tourism are among the areas where facilitating policies will create new opportunities

and promote innovation. That in turn will help the country move to higher productivity and

investment regime. The Perspective Plan envisages a far more dynamic industrial sector, creating

an export environment that is broad-based, skills-intensive, and competitive. There is urgency in

the need to expand external resources – particularly in raising remittances – and that will require

the application of technology-based and user-friendly systems for remitting money, providing

good skills training for existing and emerging markets, and aggressive bilateral negotiations for

outbound migrant workers. Addressing globalization and regional cooperation issues will entail

negotiations that give Bangladesh better access to global and regional markets. Effective

30

engagement in multilateral trade liberalization is important, and offers real opportunities for

Bangladesh to take advantage of its unique geographical location.

Making Vision 2021 a Reality

Generating the Will and Skill: The implementation of the Perspective Plan envisages the full

commitment of will, skill, and resources from all stakeholders to developing the nation into a

middle-income country by 2021. The government is required to make long-term thinking a

central element of the decision making process and service culture. The government cannot

achieve the Vision alone. It is a collective effort in which the private sector, civil society, and all

other stakeholders will share responsibility to reshape the nation’s future. The consultative

process in formulating the Planmust continues throughout the implementation since Vision 2021

is not a destination in itself but a journey. The Plan no doubt inspires great visions but the

challenge is not to let it fall short of expectations due to implementation failures.

Institutionalizing Plan Implementation: The preparation of the Perspective Plan is only the first

step along the challenging road to “Making the Vision 2021 A Reality”. Effective and efficient

execution of the Plan is the key, its success will be judged by progress made against the goals,

and targets stein the Plan. This Plan presents the broad framework to leave considerable latitude

for the Sixth Five Year Plan (2011-2015) and the Seventh Five Year Plan (2016-2020) to work

out operational details of how the country should move forward. The execution design of the

Perspective Plan has to be unique. In recognition of the importance and challenge of the task, a

Perspective Plan Management Office (PPMO) at the Planning Commission may be established to

lead, guide, and coordinate the execution of the Plan. An Independent Vision 2021 Council may

be created to continuously refine the Vision 2021 and the Perspective Plan and track progress in

an objective manner to meet the need for independent, continuous tracking of progress and

feedback to inform policy formulation and decision making.

Conclusion

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We have vast human resources. Our natural resources and agro-based raw materials are also not

negligible. Only a good govt. policy and environment can speed up industrialization and create

employment opportunities for millions. So, considering our natural and financial constraints and

huge pressure for employment, we should focus on small and medium level export oriented and

lab our thick industries. In examining the economy of Bangladesh, wherever one turns the

problems crowd in and threaten to overwhelm the analysis. Underlying problems that have

threatened the young nation remain unsolved. These problems include overpopulation and

inadequate nutrition, health, and education resources; a low standard of living, land scarcity, and

vulnerability to natural disaster; virtual absence of valuable metals; and inadequate government

and bureaucratic structures. Yet the brief history of independent Bangladesh offers much that is

encouraging and satisfying. The World Bank, leader of the Bangladesh Aid Group, described the

country in 1987 as a success story for economic development and expressed optimism that the

goals of the Third Five-Year Plan, and longer term development goals as well, could be attained.

Government policies had been effective in stimulating the economy. The private sector had

benefited from an environment of greater economic freedom and had improved performance in

banking and production of jute, fertilizer, ready-made garments, and frozen seafood. The average

growth rate of economy had been a steady, if unspectacular, 4 percent since the beginning of the

1980s, close to the world average for developing countries. The picture of day-to-day and even

year-to-year performance of the economy of Bangladesh is a mixture of accomplishment and

failure, not significantly different from that of the majority of poor Third World countries. The

government and people of Bangladesh are entitled to take some pride in the degree of success

they have achieved since independence, especially when one contrasts their success with the

gloomy forecasts of economists and international experts. The international donor community,

led by the World Bank, similarly can be proud of the role it has played in assisting this "largest

poorest" nation to become a respected member of the family of nations

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Reference

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