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How Bangladesh Reduced Poverty

How Bangladesh Reduced Poverty
Bangladesh is a country of 159 million people in the Bay of Bengal next to India. Bangladesh struggled with poverty and economic problems after gaining its independence in 1971. However, the country has recently seen economic growth along with a steady decline in poverty. How Bangladesh reduced poverty holds lessons for other countries and one can attribute it to a variety of factors.

Investing in Public Services

In the past six years, Bangladesh has lifted 8 million people out of poverty. The rate of extreme poverty fell from 17 percent to 13 percent, and the overall poverty rate declined from more than 31 percent to 24 percent. Bangladesh has also made great strides in education, health, infrastructure and energy. Primary school enrollment rates have risen from 80 percent in 2000 to more than 90 percent in 2015, and secondary school enrollment has increased from 45 percent in 2000 to 62 percent in 2015. This jump in education heralds a bright future ahead as Bangladesh invests in its youth.

In terms of health care, the country has achieved an amazing 40 percent decrease in maternal mortality rates, as well as ensuring that 63 percent of pregnant women received maternity care from a trained medical professional in 2015, up from 53 percent in 2007. Bangladesh has also improved its infrastructure by building new roads and water pipelines. People now have better access to schools, health facilities and workplaces, and the pipelines have increased access to drinkable water in rural areas. Lastly, Bangladesh has added over 2,000 megawatts of energy to the national grid and provided solar energy capabilities to over four million households in remote areas. These improvements help households go about daily activities and provide more consistent access to the internet for individuals and businesses. All of these improvements help explain how Bangladesh reduced poverty and may serve as an example for other countries.

Implementing Special Economic Zones

Bangladesh reduced poverty and increased its GDP and living standards thanks to the government’s decisions and international aid. The creation of special economic zones that encourage foreign investment was one major factor in Bangladesh’s economic growth. These zones ensure legal protection and fiscal incentives for investors and allow freer movement of goods and services. These policies make these zones in Bangladesh a safe and profitable place for foreign companies to invest.

Currently, garments and textiles are Bangladesh’s biggest industries, but it is expanding into technology as well thanks to these economic zones. For example, Bangladesh exported 12 industrial robots to South Korea in 2018. While Bangladesh currently has 12 special economic zones, there are plans to create 100 special economic zones and technology hubs to foster future growth. This investment creates jobs and brings money into the economy. Bangladesh is currently trying to direct that new money into new businesses and build the country’s service industries.

The International Development Association

In addition to government policy, the World Bank and the International Development Association (IDA) were also crucial to Bangladesh’s improving fortunes. Many of the country’s achievements in infrastructure, health, energy and education have come with the help of IDA financing. The IDA has given Bangladesh over $28 billion in grants and interest-free credit. This funding has been crucial to the country’s recent accomplishments. The combination of IDA funding and special economic zones has given Bangladesh the jobs and infrastructure needed to pull themselves out of poverty. International aid has been a crucial factor in Bangladesh’s development.

Bangladesh has made remarkable strides in both economic growth and quality of life. Economic policies that encourage foreign investment and help from the IDA both help explain how Bangladesh reduced poverty in the last decade.

– Josh Fritzjunker
Photo: Flickr

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Challenges to Development in India

development_in_india
Development in India faces many challenges despite being one of the fastest growing economies in the world.  In fact, two-thirds of students in the government public schools in India cannot even read a simple story. To put it into a better perspective, the poverty levels across India can range from anywhere worse than Malawi to better than Mexico, so there is still a large range of development that can happen through foreign aid.

India has spent a large amount of its funds in an attempt to lower infant mortality rates, but has spent more and achieved less than Bangladesh. In 1980, India had much more infrastructure than China and now it has completely reversed, with China leading radically.

It is vital that the fastest growing economy in the world does not leave behind its youth. The majority of young people’s lives in India are hindered from progress by preventable health issues like malnutrition, lack of education about HIV and how to prevent it and restricted access to health care and reproductive/sexual health services. Also, the youth of India struggles with gaining a more influential role in the decision-making process. There are many issues with gender disparity in employment and education; in addition, there is a lack of career guidance for youth.

Development in India faces two main challenges today, the first being it needs to find a way of sustaining rapid growth while spreading its benefits more widely among the entire population. The best way to maintain the rapid growth that has been occurring in India for years is to invest in the infrastructure in order to create more jobs for the lower-class, which is comprised largely of less-educated, semi-skilled workers.

In doing this, policies need to be put into place to empower the poor to be a part of the market, to restore labor regulations, and to improve both infrastructure and agronomic technology.

The other main challenge facing India today is it needs to refine its core public services. It is crucial that the people of India empower their well-being so they can reform and create more operational systems of public sector accountability. By doing so, they can improve their education, power supply, water supply and overall health care. This can be done by producing reliable information for the general public, creating public-private partnerships or decentralizing to local governments.

A great way to kick-start this development in India is to get the news out there and get support. The former first lady of France, Valerie Trierweiler, visited the Dharavi slum in Mumbai, India on January 27.  She was there working with the Nutrition Rehabilitation and Research Center and the Action Against Hunger (ACF) to advocate for human rights and combat undernourishment in children.  She plans to commit herself to humanitarian work.

– Kenneth W. Kliesner

Sources: Restless Development, The World Bank
Photo: The Wall Street Journal