Bangladesh's Journey Towards Development and Economic Inclusion

 Bangladesh has made significant advancements since obtaining independence in 1971. A nation primarily known for its agrarian landscape and extreme poverty, it undertook a revolutionary journey that finally resulted in the creation of an economy centered on manufacturing. International organizations and development partners have praised Bangladesh's economic success over the years. In 2026, Bangladesh will leave the group of least developed nations (LDC) after the UN General Assembly makes its decision. However, the International Monetary Fund (IMF), a global financial institution that closely tracks global macroeconomic conditions, has stated that Bangladesh's economic growth could surpass that of China's and India's.

Bangladesh's economy has seen a remarkable shift from being primarily rural and agrarian to being increasingly urbanized and industrialized since gaining independence. In 1981, the GDP contribution of industry—including construction—rose from 9% to 14%, while the contribution of agriculture fell from 62% in 1975 to 35%. The capital city of Dhaka saw a notable increase in population during this transition, rising from 2 million to 3.3 million people (World Population Review, 2017[8]; World Bank, 2023[9]). 

The nation has pursued a targeted industrialization strategy, centered on fostering domestic industries, since the 1980s. An outline of the economic transformation of Bangladesh is given in this section, with a focus on three areas where advancements have been achieved in the past forty years. The country's industrial capabilities have grown over time, making Bangladesh the second-largest global hub for RMG manufacturing. Other factors contributing to this progress include the country's recent embrace of digitalization, which is revolutionizing the economy.

Bangladesh has demonstrated impressive GDP growth. Following post-independence periods of stagnant growth, the nation experienced 4% annual average GDP growth in 1976, a level that persisted until the 1990s. Though at slower rates than other economies in South and Southeast Asia, this growth maintained the nation's progress. Bangladesh's GDP has grown at an average annual rate of 6% since the turn of the twenty-first century. Since 2010, the country has experienced growth rates that are higher than the average for South Asia.

Since the late 1970s, there has been steady GDP growth coupled with notable advancements in human development. By 2020, life expectancy will have risen from 66 in 2000 to 73 years, and the infant mortality rate will have significantly decreased from 60 deaths in 2000 to 24 per 1,000 live births. GDP per capita as of 2021 was $1,684 (in constant USD from 2015). While Bangladesh has succeeded in closing the GDP per capita gap with other South Asian nations, Southeast Asian economies have not made as much progress in this regard. Bangladesh's GDP per capita had regressed to 40% by 2021 from 55% of the average for Southeast Asia in the 1970s.

Bangladesh's economic environment has undergone a significant change. Similar to numerous other Asian nations, the industrial sector's GDP contribution increased from 18% to over 31% during the 1990s, while the services sector's contribution increased from 40% to over 50%, mirroring regional patterns. A significant structural change in the economies of these nations has been a hallmark of the industrialization process. These economies have moved from being based on import substitution programs meant to support indigenous industrial capacities to more advanced industrial sectors. Alongside this process of diversification, economic structures were elevated, placing more focus on higher value-added industries and businesses such as chemicals, electrical and electronics equipment, basic metals, and

Bangladesh's economic transition has demonstrated a unique feature: a dual-trait industrial system. On the one hand, the nation boasts an export-oriented industry dominated by Ready-Made Garments (RMG), with numerous businesses serving as subcontractors for global enterprises. Conversely, a more protected, domestically focused sector seeks to serve the domestic market. This dualism is maintained and sustained by a framework of policies that, despite changes, is still primarily based on the same ideas as it was when the country gained its independence. Bangladesh has developed over the last few decades into a major player in the world apparel manufacturing industry. At the moment, RMG and textiles make up more than 70% of formal manufacturing jobs and 55% of domestic manufacturing's total value added (MVA).

As a developing nation, Bangladesh has so far shown promise. But the nation must consider sustainability over 100 years, not just for the next 10 or 20. Bangladesh needs to make quick use of its newfound potential and untapped resources if it wants to become a developed nation. The blue economy is one of the underutilized resources that has enormous potential. The country has recently moved in that direction. Bangladesh wants to increase the GDP share of the blue economy by 10% by 2030 and by 9% by 2025. Bangladesh's estimated $120 trillion in maritime resources could guarantee rapid growth.

The nation must educate its intellectuals. It must realize that to become self-sufficient, it needs to provide intellectual support in a way that encourages the development of local talent. Businesses, NGOs, academics, faculty, and students should all support research. But it takes time for such cognition to develop. The country must ensure that data related to research are available from the start in a format that can be used and at a lower cost.

A social contract between the state and business does not exist, which is another obstacle to progress. Longer wait times and more prolonged periods of inconvenience for the residents occur from the project's approval through its eventual launch. Many dislike growths because of the inconvenience. This is easily avoidable provided openness is upheld. By fostering transparency in society, the state can put an end to any doubts and motivate its citizens to collaborate for a better one.

Finally, the nation will attain Vision 2041 and graduate from LDC in 2026. Unfortunately, there will be many obstacles in the way due to the shift in global dynamics. It is therefore imperative that the country assess its current state at this time.

To proceed safely and reach the destination, the nation must be ready for any enemies and have backup plans ready. Unquestionably, the country is still moving in the right direction. But to finish the journey, the country will need to monitor every compartment and approach every issue with caution.