The Economic Development of Bangladesh

Topics: Economic development, Economic growth, Economy Pages: 5 (2246 words) Published: May 12, 2014
The Economic Development of Bangladesh

Introduction

Economic development is one dimension of the more inclusive concept of development. Development is both a process and a project. As a process, it refers to changes occurring in countries defined variously as undeveloped, underdeveloped, developing, emerging, and newly industrializing. Economic development refers to the raising of the productive capacity of a country through the introduction of policies designed to enhance the productivity of land, labor and capital, raise standards of living and reduce or alleviate the poverty of the inhabitants of the country. At a minimum, economic development has a growth and a distributive dimension.

The economy of Bangladesh

Is a rapidly developing economy. Its per capita income in 2010 was est. US$1,700 (adjusted by purchasing power parity). According to the International Monetary Fund, Bangladesh ranked as the 47th largest economy in the world in 2010 in PPP terms and 57th largest in nominal terms, among the Next Eleven or N-11 of Goldman Sachs and D-8 economies, with a gross domestic product of US$269.3 billion in PPP terms and US$104.9 billion in nominal terms. The economy has grown at the rate of 6-7% p.a. over the past few years. More than half of the GDP belongs to the service sector; a major number of nearly half of Bangladeshis are employed in the agriculture sector, with RMG, textiles, leather, jute, fish, vegetables, leather and leather goods, ceramics, fruits as other important produce. Remittances from Bangladeshis working overseas, mainly in the Middle East are the major source of foreign exchange earnings; exports of garments and textiles are the other main sources of foreign exchange earnings. Ship building and cane cultivation have become a major force of growth. GDP's rapid growth due to sound financial control and regulations has also contributed to its growth. However, foreign direct investment is yet to rise significantly. Bangladesh has made major strides in its human development index. The land is devoted mainly to rice and jute cultivation as well as fruits and produce, although wheat production has increased in recent years; the country is largely self-sufficient in rice production. Bangladesh's growth of its agro industries is due to its rich deltaic fertile land that depends on its six seasons and multiple harvests.

Bengal's function as the primary agricultural producer—chiefly of rice, tea, teak, cotton, cane and jute—for processors and traders from around Asia and beyond. After its independence from Pakistan, Bangladesh followed a socialist economy by nationalizing all industries, proving to be a critical blunder undertaken by Awami League's Mujib Government following India's policy. Education policies of the British dating back from colonial era deprived education to millions of Bangla's Muslim peoples setting them back by decades. Some of the same factors that had made East Bengal a prosperous region became disadvantages during the nineteenth and twentieth centuries. As life expectancy increased, the limitations of land and the annual floods increasingly became constraints on economic growth. Preponderance on traditional agricultural methods became obstacles to the modernization of agriculture. Geography severely limited the development and maintenance of a modern transportation and communications system. Economic outlook

Efforts to achieve Bangladesh's macroeconomic goals have been problematic mostly due to various factors including the country's large population, corruption within the government, power shortages etc. The privatization of public sector industries has proceeded at a slow pace—due in part to worker unrest in affected industries—although on June 30, 2010, the government took a bold step as it closed down the Adamjee Jute Mill, the country's largest and most costly state-owned enterprise. The government also has proven unable to resist demands for wage hikes in...
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