Bangladesh’s economy apparently grew at 8.13 percent in the fiscal year 2018-19, the highest in the country’s history. But what do these impressive growth rates indicate? Do they say anything about the quality of that growth or whether the benefits of higher growth have been equitably distributed? These are the questions that economists and researchers have consistently been asking since GDP growth has somehow become synonymous with development with no regard to distributive justice.
The fact that inequality in Bangladesh today has reached the highest level in its history, at the same time as the highest-ever GDP growth has been recorded, leaves no doubt that inclusive quality growth remains as elusive as ever. According to the latest Household Income and Expenditure Survey (HIES) of Bangladesh Bureau of Statistics (BBS), the Gini coefficient in the country—which is a measure of equality—reached 0.482 in 2016, a marked increase from 0.458 in 2010, which indicates greater inequality.
One of the dangers of excessive focus on GDP growth figures is becoming afflicted with tunnel vision: issues affecting the poor and the marginalised are sidelined and the status quo remains in place. The rich continue to accumulate wealth, both by legitimate and illegitimate means. The result is a no-brainer: greater inequality. GDP growth does not take into account a number of things such as distribution of wealth or quality of life. GDP growth also does not consider the extent of institutional corruption which is one of the biggest obstacles facing Bangladesh in achieving equitable, quality growth. A good example is the miserable state of the banking sector which is plagued with a mammoth size of nonperforming loans and where defaulters have been enjoying near-impunity.
It’s time we focused on the quality of growth, not quantity. This means the government needs to focus on increased access to affordable healthcare and education, especially for the poor; de-politicisation of institutions; planned urbanisation; maintaining rule of law and ensuring justice; and tackling corruption at all levels.