Before the Covid-19 pandemic people migrated from villages to cities to find work. However, when the pandemic hit many of these people, including expatriate workers in the Middle East, became jobless and returned to their villages.
Creating employment opportunities for these people in rural areas will be a big challenge, so easy loans must be arranged for them to become entrepreneurs.
Not engaging these people in economic activities will harm the country's economy severely, said the South Asian Network on Economic Modeling (Sanem), a nongovernmental research organisation.
Experts expressed their opinions at a virtual seminar titled "Sanem Netizen Forum: Episode 8" on Saturday. The program was moderated by Sanem Executive Director Dr Selim Raihan, who also presented the keynote paper at the programme.
Dr Raihan said, "There are some problems regarding the disbursement of the Tk20,000 crore stimulus package for the small and medium enterprise sector. The banks are not interested in it. So, loan facilities must be arranged to develop the rural people as entrepreneurs, and the microcredit organisations have to come forward to do that."
Addressing the job losses in manufacturing and the garments sector, he pointed out that a reverse migration trend has emerged as low-income families are moving to rural areas from urban areas – where they might not be able to find employment.
Dr Raihan also said many expatriate workers returned to their homes permanently, which has increased the remittances recently. The government must take initiatives to assist these people.
Dr Raihan also said, "The banking sector is facing pressure due to the government's stimulus packages. The problems and the weaknesses of this sector must be identified. The plan to restore the economy to its previous condition will not be successful without implementing the stimulus packages announced by the government."
Dr Raihan, professor at the Department of Economics, Dhaka University, also said, "People who recently became poor must be brought under the social safety net programme, which has some weaknesses."
He further said the prime minister announced Tk2,500 would be provided for 50 lakh families, but only 17 lakh families have received the assistance. So, the monitoring system must be strengthened in this regard. Involving both government and nongovernmental institutions will ensure the proper implementation of this programme.
"The banking sector's weakness has delayed the implementation of this programme," he added.
In his presentation Dr Raihan highlighted the importance of strong institutions in rebuilding the health sector, banking sector and taxation.
"While people are becoming jobless, prices of essentials on the market are increasing. Those who were running businesses with small capital are now willing to keep their money as savings," he continued.
"So, many people may not resume their businesses at all and a large number of entrepreneurs in manufacturing, garments and service sectors may fall out of the economy. These people also need budget assistance and loans with small interest rates," he said.
He added, "The reverse migration trend induced by the economic hardships in urban areas entails the emergence of new socio-economic challenges in the rural areas as rural wages can be adversely affected, children's education can be hampered, drop-out rates can increase, cases of early marriage can rise, and gender disparities can widen."
Dr Sayema Haque Bidisha, professor at the Department of Economics, Dhaka University, said, "The government should focus on decentralising employment opportunities, the scope of getting loans and quality education. This will ease the challenge of recovering the economy a bit."
Dr Sayema said the government included a Tk100 crore fund in last year's budget to create new entrepreneurs, but such a fund is not in the budget this year.
Mahtab Uddin, a fellow of Sanem, said, "The government should focus on attracting Chinese investment to Bangladesh. Our logistics support is weak, so investments from China are going to Vietnam."
"Additionally, we need a skilled workforce, which Vietnam already has. Their workers are internationally certified. We should continue trying to create employment opportunities with Chinese investment," he added.
Replying to a question, Dr Raihan said, "The government decided to shut down the jute mills at the wrong time. The workers in this sector are suffering because of the corruption of the people who were directing this sector."