Reducing gap between rich and poor in Bangladesh

SALEEM SAMAD

The gap between the rich and the poor is perpetuating and has enlarged alarmingly, despite a decline in the rate of poverty in recent times before the pandemic hit.

The poverty level dropped to 24.3% in 2016 from 31.5% in 2010, but other indicators which measure income inequality within the population, coupled with slow investment for vulnerable communities, are likely to challenge the achievements of the Sustainable Development Goals (SDGs) by 2030, according to social scientist AKM Mustaque Ali, an executive director of INCIDIN Bangladesh.

Whenever financial resources are invested to strengthen the capability of the bottom 20%, the local ruling party elites with their nexus of power lobbies eat up the development initiatives, leaving bread-crumbs for the vulnerable.

The vulnerable community must also have access to natural resources, basic education, health care, learning skills, community participation in development planning, and the justice system. The digital divide that exists among the rural poor has also blocked the best practices of good governance, transparency, and zero-tolerance to corruption. 

A lack of access to the justice system has also aggravated social tensions, which challenges the traditions of social harmony and religious freedom in rural areas.

The power lobby, which includes politicians, rent-seekers, and contractors who are responsible for milching the development budget for the poor, end up making the rich richer. Several other factors, including climate change, have expedited rural-urban migration.

Historically, Bangladesh has had inequitable access to land, in a land-scarce country where the per capita cultivated land is limited. Minority elites with an unholy alliance with power lobbies dominate both land and river resources.

“Migration fundamentally challenges our understanding of development,” says Mustaque Ali in an outstanding research report published in “Migration in South Asia: Poverty and Vulnerability” published by Kathmandu based think-tank South Asia Alliance for Poverty Eradication (SAAPE).

Internal migration is generally linked to population pressure, adverse person to land ratio, landlessness, poverty, natural calamities, law and order, lack of social and cultural spaces, job opportunities, and higher wages. As for the poor, the search for survival is often forced, controlled, and restricted.

Dhaka is the only migration destination for both the rich and the poor in Bangladesh. It’s understood that migration to the Dhaka region is caused by the concentration of economic, administrative, and political institutions in the capital -- thus it continues to attract migrants from other regions.

The present state of the economy of Bangladesh elucidates that economic growth is not a guarantee in cutting down the rate of unemployment. Bangladesh is in a state of jobless growth. Violence and conflict is another risk factor which causes migration.

There is no respite in attacks on minority communities, especially on Hindus and on the indigenous communities, by non-state actors, backed by local leaders. The silent, low-intensity violence against minorities is occurring with impunity, while civil administration and police in most cases do not take cognizance of the attacks.

Only those occurrences which make headlines in the media get the attention of the civil administration and police officers. Seldom have the victims been compensated. Justice remains elusive as perpetrators are released on bail, while judicial proceedings reveal that eye-witnesses have remained away from the court in fear of further reprisal.

Eminent economist Dr Abul Barakat has, in his research, said though, that most of this low-intensity violence is not to be blamed on religious motives -- the only intention was to grab the land, property, and business establishments of minority populations.

Bangladesh needs to enlarge its investment in ensuring the bottom 20% population living in both urban and rural areas are brought under a wider safety net, which most development economists believe will significantly reduce the gap.

First published in the Dhaka Tribune, 24 August 2021

Saleem Samad, is an independent journalist, media rights defender, recipient of Ashoka Fellowship and Hellman-Hammett Award. He could be reached at <saleemsamad@hotmail.com>; Twitter @saleemsamad

Austerity, economic recovery, and the debt trap

SALEEM SAMAD

Why developing nations such as Bangladesh must be especially wary of how they seek to recover from the Covid-19 fallout

Development economists and civil society organizations (CSOs) argue that austerity measures adopted by the governments of third-world countries are not a solution during the coronavirus crisis.

They raise questions about austerity, gradually imposed after the Covid-19 crisis due to the massive debt contract. Immediate suspension of debt payments and better still, cancellation of debt, must take priority.

Instead, they advise governments to opt for economic recovery. The economic recovery will only be possible from “debt relief” and “debt justice.”

Bangladesh and other developing countries have given special attention in the wake of the coronavirus crisis and engaged in servicing external debts to international financial institutions.

The governments are deliberately diverting funds from education, human development, and infrastructure development sectors, whereas the health and safety net programs are implemented under a shoe-string budget.

According to the United Nations Conference on Trade and Development (UNCTAD), the pandemic has pushed another 32 million people in poor countries into abject poverty.

Another report by the International Finance Institute highlights the $272 trillion global debt, a new high, in the third quarter of 2020 and warns us about the “attack of the debt tsunami.”

There are issues in which countries while seeking assistance from international financial institutions, are often imposed conditionalities that have not necessarily been negotiated with borrower states. These conditionalities are even seen in the context of the Covid-19 pandemic.

The government deliberately does not involve the citizens to participate in consultations, discussions, or negotiations. Such conditionalities increase the country's chances of falling into a “debt-trap.”

Ultimately, it is the people that have to foot the debt repayment after authorities impose additional taxes and levies to recover from the vicious cycle of debt.

According to standards of international law, international financial institutions should be held responsible for complicity in the imposition of economic reforms that violate human rights, which is well documented.

Governments and major multilateral institutions like the World Bank, the IMF, and regional development banks have used repayment of public debt to generalize policies that have damaged public health systems.

This has meant job cuts in the health sector, job instability, reduced numbers of hospital beds, closing down neighbourhood health services, increased medical costs both for care and medicines, under-investment in infrastructure and equipment, and privatization of various sections of the health sector along with public under-investment in research and development for treatment, which is to the advantage of big private pharmaceutical groups and companies.

Even before the Covid-19 pandemic broke out, these policies had already led to an enormous loss of human lives, and all around the world, health personnel were organizing protests.

Neither the World Bank nor the IMF have cancelled any debts since the beginning of the coronavirus pandemic.

Although they have made endless calculated declarations to give the impression that they are taking very strong measures. This is completely false.

Worse still, since March 2020, the IMF has extended the loan agreements that entail continuing with the structural measures enumerated above. As for the World Bank, since March 2020 it has received more in debt repayments from developing countries than it has paid out to finance either donations or loans.

Eminent development economist, Dr Atiur Rahman states that “We want to fight the coronavirus and, beyond that, improve the health and living conditions of populations, [for which] emergency measures must be taken.”

Immediate suspension of debt payments and cancellation of debt must take priority, suggests former Bangladesh Bank’s governor Dr Rahman.

The austerity measures do not contribute to economic recovery, but instead have negative consequences in terms of economic growth, debt ratios, and equality, and routinely result in a series of negative human rights impacts.

First published in the Dhaka Tribune, 8 December 2020

Saleem Samad is an independent journalist, media rights defender, recipient of Ashoka Fellowship and Hellman-Hammett Award. He can be reached at saleemsamad@hotmail.com; Twitter @saleemsamad