Long-run perspectives on the economy of Bangladesh

The work is a timely and valuable contribution to the annals of publications on the economy of Bangladesh. Coming exactly forty years after the liberation of Bangladesh, the book meets a long-awaited need for a comprehensive and lucid presentation on how the economy has performed in the longer-run during this period. It is a successor of the seminal and benchmark studies by A.R. Khan (The Economy of Bangladesh, Macmillan, 1972) and A.R. Khan and M. Hossain (The Strategy of Development in Bangladesh, Macmillan in association with OECD Development Centre, 1989) and adds to the efforts of the very few others who have attempted such periodic stock-taking exercises. One comes across more numerous studies, published both in Bangladesh and abroad, of the type which concern themselves with questions of the current challenges and future prospects of the economy of Bangladesh. The stock-taking exercise is the more difficult of the two genres. This publication fully meets and exceeds expectations in terms of its technical analysis, presentation of facts, and interpretation of past trends, while still not skirting issues and questions of the challenges, obstacles and opportunities going forward. The author is to be congratulated for this contribution, and more so for the very readable style in which it is written without compromising on the rigour of the analysis and references to theory, research and empirical findings.
As a starting premise, the book sets itself the objective of broadly examining whether the post-independence dire predictions of Bangladesh as a "basket case" or as a "test case for development" have been borne out. Despite numerous setbacks many stemming from the various socio-political realities of the last four decades and many missed opportunities and policy letdowns -- the book finds that much has been accomplished. It notes that the clamour of negative and pessimistic forecasts has been somewhat muted in recent years, and concludes that achieving Middle Income Country status within the medium-term is a realistic dream and the country is broadly on track. However, it makes the important observation that accelerating growth, with the fruits of development that are broadly and equitably shared, is the key challenge.
After a context-setting introduction, the book analyzes the major macroeconomic developments in the last four decades. It traces the growth of overall GDP and per capita income during the period and identifies the contributions of the major sectors. Longer-term trends in savings, investments, and prices are analyzed. It has been pointed out that achieving the targeted GDP growth rates of 7-8 percent in the short to medium-term will require gross domestic savings rates much higher than the current rate, or a substantial increase in the efficiency of capital. Increasing both the rate of investment and the return to capital are perhaps the major challenges for policy makers. Moreover, the author highlights two important changes required for sustaining the growth process: getting rid of confrontational politics, and expansion of quality education among the poor.
The broad macroeconomic analysis is extended in the next several chapters with in-depth examinations of developments in industry, agriculture and the rural non-farm sectors. The performance of the industrial sector is broken down in terms of key phases of dynamism and stagnation and the underlying factors. The industrial subsectors are also discussed with special attention to small and medium enterprises, industrial employment, and the participation of women in the industrial labor force. Obviously a fuller analysis of the dynamism of the Bangladesh ready-made garments industry and its particular problems would be interesting,
The analysis of the agricultural and rural sectors also focuses on issues of land ownership and distribution, agricultural technology and input use. There is a brief but excellent discussion of the role of microcredit and its particular successes and challenges. Perhaps a deeper analysis of the question raised in recent debates about the efficacy of microcredit in reducing poverty could have presented the empirical evidence of credible research in this area to settle the politically charged polemics.
The chapter on poverty and its measurement and recent trends and developments in Bangladesh presents the cutting-edge theoretical discussion and empirical research, and is an excellent contribution of the book. The concluding chapters address the human development dimensions of Bangladesh's development during the last 40 years, including education and the inequities in the subsectors, regional issues, demography and population dynamics, and issues of gender equity, women's employment and empowerment.
The author has undertaken substantial research on various research questions relating to the Bangladesh economy at the BIDS and elsewhere, and the various chapters benefit immensely from that scholarship and expertise. In fact, the whole book is strengthened considerably by the author's familiarity and first-hand primary and empirical research on most of the issues. While a major strength, there is also a tendency to focus mainly on subjects and issues where the author has expertise and has undertaken research, perhaps at the cost of what might have been other interesting topics that could have been included in the book. However, this is a minor quibble given the wide scope of the book and the breadth and depth of subjects and issues covered. In fact, there is much original and new research and analysis undertaken for the book which might be of considerable use to researchers and students. The author rightly points out the various data and statistical constraints faced in undertaking an overview over such a long time period, and there are areas where continuous time series are not available and often there is reliance on cross-sectional and snap-shot surveys for what is essentially a dynamic view spanning four decades. In addition, to the credit of the author, she has contributed to the Bengali lexicon of economic terms in having to deal with often technical issues.
The book is highly recommended for students, teachers, policy makers, government officials, politicians, academics, media and NGO personnel, business-people, and, in fact, anyone with an interest in the recent economic history of Bangladesh and the current challenges and future trends. As it is in Bengali, and written in a very understandable non-technical language, the study is available to a wide segment of readers. The author may give consideration to publishing an English version of the book, which will no doubt be highly valued by the wider audience who would be interested in the evolution of the Bangladesh economy including international academics, researchers, aid practitioners, diplomats, global NGOs and international civil society.

Zafar Ahmed is an economist. He can be reached at [email protected]