Bangladesh’s Economy Soars – India & Pakistan Fall Behind
Bangladesh, a country that was found amid famine and war in March 1971, seemed destined to fail back then. They managed to get freedom from the much powerful and richer Pakistan. In the same year, musician and sitar maestro, Pandit Ravi Shankar asked his friend George Harrison to help the country, which was suffering from the effects of floods, famine, and civil war. The resulting Concert for Bangladesh was the first major music benefit concert for a humanitarian cause, raising much-needed funding for economy and awareness for UNICEF in Bangladesh.
No one believed that a country, which barely met its needs with the help of charity organizations, would one day grow so big.
Today, Bangladesh is way over its bad days. According to experts, Pakistan and India are now poorer than Bangladesh. Sounds unbelievable right? It is remarkable how a small country derived from India and later Pakistan left its former parent countries behind.
Bangladesh has managed to perform better in key indicators of economy and it’s growth comes basically through exports, social progress and fiscal prudence.
1. Bangladesh’s soaring per capita income
In 2007, Bangladesh’s per capita income was half of that of India. An average citizen of Bangladesh is now richer than that of India. Bangladesh’s Cabinet Secretary reported its per capita income for the financial year 2020-21 (FY21) at $2,227, which has increased by 9% from $2,064 reported during the financial year 2019-20.
In 1971, Pakistan was 70% richer than Bangladesh. Today Pakistan’s per capita income is $1,543 and Bangladesh is 45% richer than Pakistan.
Between 2011 and 2019, Bangladesh’s exports grew at 8.6% every year, compared to the world average of 0.4%. The success is largely due to the country’s relentless focus on products, such as apparel, in which it possesses a comparative advantage.
2. Increase in the women labor force
Behind every nature’s success, are women. Bangladesh has proved this fact for its economy by uplifting women and increasing the share of Bangladeshi women in the country’s labor force. As per the International Labor Organization, the women workforce has seen a consistent downfall in both India and Pakistan.
Source: International Labour Organization, ILOSTAT database. Data retrieved on January 29, 2021.
3. Well maintained public debt-to-GDP ratio
Bangladesh has maintained its public debt-to-GDP ratio between 30% and 40%. Fiscal restraint has allowed Bangladesh’s private sector to borrow and invest. Alternatively, India and Pakistan will both emerge from the pandemic with a public debt of close to 90% of their GDP.
Being bigger and stronger nations, netizens of India and Pakistan were stunned to read this news and many expressed disbelief. Well, maybe they need to consider this – did the giants hit their snooze button a few times more than required?
Bangladesh has established itself more firmly in the global economic map in the last decade and the country now stands at a turning point for progress that it has never seen before.
