Last month, the International Monetary Fund (IMF) ranked Bangladesh ahead of India in per capita income –it further shamed Narendra Modi’s stewardship in New Delhi, and how the nation Henry Kissinger famously dismissed as a “basket case,” is also having a terrific growth.
The Bangladesh economy is set to grow 4%-plus this year, and in ways that have heads exploding in neighboring India…reminding Delhi that India is not Southeast Asia’s only superpower.
And among developing nations having “good” COVID-19 crises, Bangladesh may be the most surprising.
The shift in South Asia’s economic pecking order presents a rare window of opportunity for the country. If Hasina’s government can continue to improve social indicators — including poverty rates — and work harder to modernize economic institutions, the pivot to Bangladesh will gain momentum and raise per capita income far beyond today’s roughly $1,900.
“The key is increasing transparency, curbing graft and increasing efficiency…along with the need to diversify the economy,” says Ahsan Mansur, chairperson of Bangladesh’s ubiquitous Brac Bank,”We (also) need a lot of effort to improve on the doing business indicator and on infrastructure development.” “All these challenges are intricately linked, of course”.
The bottom line is: invest big in human capital; digitalize the economy. accelerate financial reform; raise its ease-of-doing-business score in order to “woo more companies” its way.
Hasina’s government has positioned Bangladesh’s garments-industry oriented, lower-wage economy as another haven for multinational companies looking to diversify away from China.William Pesek: award-winning Tokyo-based journalist and author of “Japanization: What the World Can Learn from Japan’s Lost Decades.”
These are the four ways Dhaka can accelerate the transition to middle-income status, “and have a predictable revenue stream for the state fueled by a sustainable growth of a well balanced economic communities bottom up, a South Asia observer based in Islamabad says.
“Pakistan is doing similar…for example, it has been batting for textile industry as buyers scrap orders elsewhere”, he says. “Pakistan is also another country having “good” COVID-19 crises”.
According to a Gulf analyst based in UAE, “Arab states or some Arab countries can take a leaf out of the Bangladeshi notebook and try to emulate and create a workforce that can move the time”.
Back in February, before the coronavirus changed everything, I spent a day with Kamal Quadir, co-founder of mobile banking sensation bKash used by nearly 50 million people. Its financial supporters include the Bill & Melinda Gates Foundation, the World Bank’s International Finance Corporation and Jack Ma’s Ant Group.William Pesek: award-winning Tokyo-based journalist and author of “Japanization: What the World Can Learn from Japan’s Lost Decades.”
Impressive as I found Quadir and bKash’s sprawling downtown Dhaka campus, this is but one example of the good that will come from Hasina’s team digitalizing of a nation on the move. It is a means of pulling the nearly 50% of the adult population that is unbanked into the financial system. And reminding Delhi that India is not Southeast Asia’s only superpower.William Pesek: award-winning Tokyo-based journalist and author of “Japanization: What the World Can Learn from Japan’s Lost Decades.”
The original article appeared in Nikkei Asia.