Bangladesh in the 21st Century
Challenges in Shaping the FutureLest We Forget
Lest We Forget
Non-tariff issues, strongly pursued by the advanced countries led by the USA, such as trade related intellectual property rights (TRIPs), rule of origin, labour standards, and eco-standards could substantially constrain production and export from countries like Bangladesh. This is so not only because these countries may not be able to fulfil the associated conditions but also because these can be manipulated, making it very difficult for such a country to fulfil them.
Taking out patents in fact has become a frenzied activity, particularly in the USA, by transnational companies, universities and the US Government, often involving products of vital interest to, or of long standing usage in, one or another or several of the developing countries. For example, some 70 patents have been taken on products from the Neem tree, which has been used in India for centuries as fungicide and medicine; and Basmati rice which is a major type of rice produced and exported by Pakistan has been patented in the USA. Many other plant species have been or are going to be patented in the USA and other developed countries. The patenting means that these products cannot be exported to the USA without paying royalties. And under WTO rules, governments of developing countries must pass laws allowing similar patents to be granted in their countries from next year. Also, when industrial designs and agricultural practices, which may be the outcome of natural evolution and may be particularly relevant for developing economies, are patented, these cannot be used by the developing countries without paying royalties. Non-compliance would make the country concerned out of step with WTO rules, and may face reprisals from the particular patent granting country, which is mainly, up to now, the USA. In Japan, two companies have applied for patent rights on 'cooking a curry', which is traditionally the cuisine of the South Asian countries. (Independent of Sunday, London, 28 November 1999).
The reduction and eventual withdrawal of the quota facilities for readymade garments (RMG) could hit Bangladesh hard because competition is going to be very stiff among many developing countries of which RMGs are a major export or the bulk of all exports. Following the withdrawal of its quota, a country like Bangladesh will no longer have a share of the market reserved for it and may therefore lose much, being outcompeted by more efficient suppliers from other countries. In order to avoid that kind of a fate, Bangladeshi garment industry must raise its efficiency and international competitiveness over the next few years.
Foreign direct investment (FDI) has increased in Bangladesh over the past few years substantially from a very low base, but was still only US$ 317 million in 1998; and it does not seem likely to increase a great deal in the coming years because of a range of reasons relating to political, infrastructural and procedural aspects, although a full open door policy concerning foreign private investment has been adopted.
Turning to the outcome of the development efforts over past decades in Bangladesh, the first point that one may note is that the poverty ratio (with access to less than 2122 kcal) has remained very high at abut 48 per cent of the people over the past decade or so and that about a quarter is currently afflicted with hardcore poverty (with access to less than 1805 kcal). Given the large population of 128 million, these ratios translate into over 60 million poor and over 30 million ultra poor. The large and growing population poses a major challenge before us. Economic growth has also not accelerated, and social indicators generally reflect low performances. Environmental degradation is widespread and serious, and continues unabated. Governance remains characterized by corruption, lack of transparency, inefficiency and bureaucratic hindrances. It is important that all these crucial issues are addressed seriously. A national consensus is needed for successfully addressing these fundamental problems. Given enlightened self-interest, political parties should find ways of cooperating on major national issues. Otherwise the nation, the people, and the political parties themselves will all continue to be losers.
The present Government of Bangladesh has achieved such high profile successes as the Ganges Water Sharing Treaty and the Chittagong Hill Tracts Peace Accord. It is also keenly pursuing regional and sub-regional cooperation, so necessary for finding collective solutions to common problems in the areas of poverty alleviation, sustained economic growth, environmental protection and enhancement, and in collectively seeking benefits from the globalization process in the highly iniquitous world. However, there are crucial aspects in the development strategy now being pursued, where serious lacunae exist.
I have elsewhere argued that the ongoing development strategy in Bangladesh has two serious faultlines which need to be removed to make the paradigm consistent with the realities facing the country, so that the desired results can be expected from its proper implementation. One of these is poverty alleviation, which, although talked about much, has not yet been incorporated in the strategy as a direct goal. Given that the burden of the strategy is on the market mechanism that focuses on competition and efficiency, it is the rich and powerful who largely benefit from it while the poor and the disadvantaged not only remain marginal but also become relatively worse off. Poverty alleviation is to be achieved through the so-called 'trickle down' effects which are known to be inconsequential, particularly where economic growth rates are low to moderate as has been the experience of Bangladesh; and, in the case of high growth rates (8 to 10 per cent), these must be sustained over a relatively long period of time before a substantial impact can occur in relation to poverty alleviation. Given the kind of poverty syndrome Bangladesh faces (indicated earlier), there is an urgency for a quick breakthrough in poverty alleviation, and that cannot be achieved unless the basic cause of poverty is directly attacked. For the most vulnerable, though, there are 'safety net' programmes; but these programmes usually provide temporary succour and do not address the underlying causes of poverty. The second faultline is that while the glaring socio-economic inequality is the basic cause of persisting poverty of such magnitude and depth, equity is not built into the strategy as a process component.
These faultiness must be removed, along with addressing other issues noted earlier, and the ongoing reform agenda reworked to reflect the prevailing realities towards constructing a sustainable development pathway for the country. The measures to that end would include promotion of people's participation in governance through effective local government institutions; agrarian reforms and necessary agricultural support services; and promotion of productive employment focusing on the poor and the disadvantaged, particularly through small and medium enterprise development by providing/facilitating necessary information, training, technology and credit. A major focus needs to be placed on productivity improvement and expansion of the economic activity over time. Obviously, strong emphasis on education, training and health is needed, but much more in terms of creating conducive facilities for the people to launch themselves on a path that would bring forth their creative energy into full play for their own and national benefits. A major thrust is also needed toward the promotion of exports through appropriate special measures. An effective government is needed to play these roles, which involve facilitating for sure, but also direct assistance as and where necessary for enabling purposes.
The present Government of Bangladesh has been assisting the needy farmers through special agricultural credit, some subsides, and support prices (purchasing foodgrains at the harvest time for sale at times of shortages), which are in fact the kinds of interventions that the ground realities in Bangladesh call for, but are at variance with aid conditionalities. These measures have certainly played an important role for the average annual agricultural growth rate being as high as 4.4 per cent during 1995/96-1997/98 as against about 1.0 per cent during 1991/92-1994/95. It is necessary that steps are taken to build other basic ground dynamics into the development strategy and the reform programmes being pursued. I am arguing for the sake of pragmatism. If the realities on the ground are ignored or neglected, no strategy can be successful in achieving the national goals. I am all for socio-economic reforms, but those must respond better to the needs and purposes than the existing policy regime; otherwise, one can legitimately ask why are the particular reforms being carried out?
Indeed, in order to shape a future which will be prosperous for all, on an equitable basis, Bangladesh needs to build its internal strength in respect of economic, social and political processes. Certain key requirements in this regard are: consensus among all political parties on major national issues; strong emphasis on human capability development (education, training, health), focusing on the poor and the disadvantaged; and an effective deployment of the people through a combination of private sector and state partnership efforts promoting economic advancement, with the former producing, distributing, innovating, and seeking out and employing new and advanced ideas and technologies and the latter facilitating and ensuring that the rule of law is properly applied and that an appropriate regulatory system is in place and adequately implemented. This private-public partnership should be built having due regard to the social perspectives of people at large - such as promotion of transparency, equity and participation; poverty alleviation; corruption removal; improvement of women's status - to avoid possible social disruptions and upheavals on one hand and create conditions for an orderly, cohesive social progress on the other. Ethics and morality are obviously key attributes to be inculcated by all concerned.
For the state to be in a position to play its proper role in this process as well as in respect of its other constitutional functions, there must be a conducive political atmosphere in the country - one in which the political parties, both in government and in opposition, pursue rational interests and people's welfare as their basic goals; bring enlightened self-interest (which would imply: what is good for the nation and the people is also good for the political parties) - rather than narrow, self or group or party interest - to bear on the way they conduct their politics and political engagements with one another; and discard confrontational politics which currently holds sway. In order to shape a better future for the nation all concerned must come forward without further loss of time to set the tone for such a political process to take root as the new century unfolds. Otherwise the future may be too dark for Bangladesh amid the blaze of an approaching noon for our global co-travellers, far and near.
This piece is in continuation of the author's last column published on December 28
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