Dr Kamal Monnoo
Regrettably, there is a lot of propaganda and fake news being spread about Bangladesh, mostly coming from Indian social and print media, on how the biggest textile industrial park BEXIMCO has been shut down and 170 top textile factories have been closed in Bangladesh. Many are relocating to UP, India. And why under the leadership of the Nobel Prize laureate Mohammad Yunus, the country is experiencing severe economic strain & is on the verge of going bankrupt.
The statements could not be further than truth, as the reality is that no, the Beximco Group in Bangladesh has not been closed, but the government has only made some decisions to address financial challenges by either shutting down the public sector loss-making companies and selling the ownership of 16 garment companies that were a continuous burden on the national exchequer or to allow only profitable companies, including Beximco Pharmaceuticals, to remain operational. Also, companies with the Beximco Group that are not sustainable under private-public partnerships will now simply be leased-out to the highest bidder in order to address financial strains on the park – all-in-all a very prudent step indeed. Not to mention that of late there has also been an announcement by Beximco Pharmaceuticals itself that the reduced distribution of its products in response to civil unrest in Bangladesh, has now returned back to normal levels.
For years Bangladesh has been hailed as an economic miracle, but deeply entrenched has been systemic corruption and rent-seeking whereby according to a Bloomberg report in 2023, more than 70% of the garment exports industry and in excess of the total national LSM (large scale manufacturing) connects somehow to powerful politicians sitting in the parliament or to the strong bureaucracy and the military establishments. Sheikh Hasina, who ruled the country autocratically with the help of India from 2009 until August this year, insisted she was the brains behind the growth (official statistics giving these claims legitimacy by claiming that growth levels in 2018-19 hovered around the 7% mark, a rate comparable with China in the region).
Ironically, the claims fall strikingly short of reality and a new white paper, published earlier this month, all but shreds the economic miracle. It points out on how Bangladesh’s development story stood on false grounds of some very cooked-up GDP figures. The 385-page study was written by a committee of experts whom the interim government (led by Muhammad Yunus, a microcredit pioneer) tasked with examining all aspects of Bangladesh’s economy. Using work from the World Bank that measures economic activity by examining the intensity of lights at night-time, the report calculates new estimates for growth. It finds that the real rate of expansion in 2018-19 may have been around only 3%, not the 7% claimed by official statistics. The report accuses powerful elite of manipulating GDP estimates for domestic and external propaganda, since large amount of wealth was being amassed by it and also simultaneously being siphoned off to foreign shores. It estimates that between 2009 and 2023 around $234bn was siphoned out of Bangladesh. On an annual basis, that amounts to roughly 3.4% of GDP today. These corruption-ridden financial outflows include money earned from different activities, ranging from stock market scams to pure rent-seeking to extortion to to drug-trafficking, and operations being methodically carried out on the behest of ruling stakeholders.
The writer is an entrepreneur and economic analyst. Email: kamal.monnoo@gmail.com
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