In the month of Bangladesh's 49th victory anniversary, all the important indicators of the country continue to inform the world of its self-reliant and fast-growing economy. After winning the Liberation War on December 16, 1971, the country had to deal with a war-torn and fragile economic system. In 1975, the government led by the Father of the Nation, Bangabandhu Sheikh Mujibur Rahman was able to include Bangladesh in the category of Least Developed Countries (LDC) of the United Nations so that Bangladesh could access the benefits (foreign grants, food aid and so on) given to least developed countries. Later, it took Bangladesh forty-three long years to reach the point of transition from a least developed country to a developing country. Since 2016, Bangladesh has started the 6-year process of passing the category of "developing country" of the United Nations. So far, Bangladesh has met all three eligibility criteria to graduate from the UN's Least Developed Countries (LDC) list and is on track for graduation by 2024. Bangladesh has made significant strides in poverty reduction supported by sustained economic growth. Moreover, the country's literacy rates, life expectancy and per capita food production have risen significantly as well.
Regarding Bangladesh's GDP growth rate, it has increased from 5.5 percent in the last two decades to 8.2 percent in FY 2018-19. Despite the global Covid-19 pandemic, the economy still experienced a growth of 5.24 percent in FY 2019-20. Judging by the per capita GDP, not only did Bangladesh surpass Pakistan but also India according to the World Economic Outlook published by the IMF in October 2020 which is undoubtedly highly commendable.
However, Bangladesh should also ensure the fair distribution of income resulting from its remarkable growth and economic performance. Since per capita GDP is an average indicator, if both per capita GDP growth and income distribution inequality increase then the lower class people will be deprived of their fair share of growth. Additionally, even though the per capita GNI of Bangladesh has reached US$2064, the pandemic has simultaneously pushed a lot of people into poverty. The Bangladesh Institute of Development Studies (BIDS) in a research finding projected that Bangladesh will have 16.4 million new poor in 2020. Moreover, according to the latest data, 49 million out of the total 168 million people in Bangladesh are in poverty
Although income inequality has always plagued the economy, the situation was significantly worsened by the pandemic. The Covid-19 virus has caused many economic complications in the world as well as created big challenges for the implementation of inclusive development. So while we will celebrate the golden jubilee of independence next year on one hand, on the other hand, we will face substantial development challenges related to poverty in the aftermath of the pandemic.
If Bangladesh wants to implement its inclusive and sustainable development goals, then it is important to ensure just and fair development benefits for every human being. Eliminating inequality in the distribution of income between the rich and the poor is critical for the achievement of Sustainable Development Goal 10 which focuses on reducing the inequality within and among countries. This involves reducing inequalities not only in income but also those based on age, sex, disability, race, ethnicity, origin, religion and status within a country. Therefore, reducing inequalities and ensuring that no one is left behind are integral to achieving the Sustainable Development Goals. The General Economic Division (GED) recently published the SDG Bangladesh progress report 2020. According to the report, although some goals are on track to be achieved by 2030, Bangladesh still lags in terms of reducing inequality because of its social and economic disparities. The report says that the richest five percent of the households get nearly 28 percent of total Bangladesh income, while the bottom five percent of the household gets only 0.23 percent. Moreover, income inequality is worsened by the existing inequalities in healthcare, education facilities, women empowerment, social security, etc.
So if Bangladesh's income inequality continues to grow in this way, it will not be able to achieve the Sustainable Development Goals by 2030. To fulfil the dream of Bangabandhu's "Shonar Bangla", it is essential to ensure that development is people-centric with everyone reaping the benefits of development. We will be able to successfully celebrate the golden jubilee of Bangladesh's independence next year only when we will be able to ensure a balanced distribution of wealth and prosperity in the country.
The author is an Assistant Professor at Department of Environmental Economics, Dhaka School of Economics
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.