Waqas Shair<\/p>\n
Pakistan and Bangladesh share historical roots, language, and culture, having been one nation until 1971. Both countries began as agrarian economies with similar challenges of poverty, illiteracy, and political instability. However, their trajectories diverged sharply after Bangladesh\u2019s independence.
\nFor instance, in 1971, Pakistan\u2019s GDP was $10.67 billion, surpassing Bangladesh\u2019s $8.75 billion. By 2000, Pakistan led with $99.48 billion, but Bangladesh\u2019s consistent growth closed the gap. By 2017, Bangladesh reached $293.73 billion, nearing Pakistan\u2019s $339.21 billion, and by 2023, Bangladesh surged ahead with $437.42 billion against Pakistan\u2019s $337.91 billion. Bangladesh\u2019s average GDP growth rate of was 6.48 percent over the last decade outpaces Pakistan\u2019s 3.80 percent, reflecting stronger economic progress.
\nIn 2015, both Bangladesh and Pakistan entered the lower-middle-income category by surpassing the $1,136 GNI per capita threshold under the World Bank Atlas method. By 2021, Bangladesh\u2019s GNI per capita soared to $2,567, while Pakistan lagged behind at $1,363. With Bangladesh\u2019s impressive economic momentum, it is poised to reach the $4,466 upper-middle-income threshold far earlier than Pakistan.
\nBangladesh\u2019s economic success is a testament to the power of strategic planning and focused development. Driven by export-led growth, the country\u2019s thriving garment industry, which contributes over 80 percent of total exports, has become a cornerstone of its economy, boosting employment and income across the nation. This success is underpinned by a stable macroeconomic environment, with controlled inflation and a steady exchange rate creating a favorable climate for investment and growth. Increased female labour participation and slower population growth have further strengthened sustainable development, forming a robust economic foundation.
\nBangladesh has surpassed Pakistan in export of goods and services over the years. In 2000, Pakistan\u2019s exports of goods and services stood at $9.58 billion, marginally ahead of Bangladesh\u2019s $6.59 billion. However, by 2023, Bangladesh\u2019s exports soared to $57.55 billion, leaving Pakistan, which grew to $35.41 billion, significantly behind.
\nIn terms of exports of goods and service as a percentage of GDP, Bangladesh has consistently outpaced Pakistan over the years. Bangladesh\u2019s export percentage of GDP peaked at an impressive 20.16 percent in 2012, with a low of 10.44 percent in 2020, maintaining an average of 14.78 percent over the period. In contrast, Pakistan\u2019s export percentage peaked at 13.48 percent in 2011, dipped to a minimum of 8.22 percent in 2017, and averaged 10.89 percent \u2013 a performance that underscores Pakistan\u2019s slower and less steady growth. This remarkable trajectory highlights the effectiveness of Bangladesh\u2019s policies and its ability to leverage its resources to achieve consistent and sustainable growth. Through a combination of export-driven initiatives, macroeconomic stability, and inclusive workforce participation, Bangladesh has emerged as a success story in the region.
\nBangladesh\u2019s economic stability highlights its effective policies and resilience. From 2000 to 2023, it maintained an average annual inflation rate of 6.49 percent, significantly lower than Pakistan\u2019s 9.38 percent. The Taka depreciated moderately from 52.14 to 106.31 per USD, a 104 percent total depreciation at 4.5 percent annually, while Pakistan\u2019s Rupee weakened sharply from 53.65 to 280.36 per USD, a 422 percent depreciation at 7.45 percent annually. Bangladesh\u2019s disciplined macroeconomic management contrasts with Pakistan\u2019s challenges of inflation and currency instability, showcasing the importance of strategic governance in shaping economic outcomes.
\nBangladesh\u2019s economic progress is deeply tied to its success in empowering women, particularly through its thriving export-oriented garment industry, where women form the backbone of the workforce. This integration has significantly boosted female labour force participation, rising from 23.56 percent in 2000 to 32.95 percent in 2023. In contrast, Pakistan\u2019s progress has been slower, constrained by societal and economic barriers, with participation increasing from 15.47 percent to 22.91 percent over the same period. Bangladesh\u2019s consistent outperformance underscores the transformative impact of inclusive economic policies.
\nIn 1980, Bangladesh\u2019s population of 88.02 million slightly exceeded Pakistan\u2019s 82.29 million. However, by 1987, Pakistan, with faster growth, surpassed Bangladesh, reaching 105.13 million compared to 104.96 million. By 2023, Pakistan\u2019s population had surged to 247.50 million, far outpacing Bangladesh\u2019s 171.47 million. Pakistan\u2019s annual population growth rate of 2.63 percent, compared to Bangladesh\u2019s 1.58 percent, reflects significant challenges in managing resources, employment, and social services. In contrast, Bangladesh\u2019s controlled growth highlights the success of its more effective socio-economic policies and planning.
\nPakistan should focus on export diversification and strengthening labour-intensive industries like textiles. Stable macroeconomic policies are crucial, including controlling inflation and stabilizing the exchange rate to attract investment. Empowering women through workforce integration, particularly in export-oriented sectors, can boost productivity and income.
\nAdditionally, implementing population management strategies to rationalize growth will ease pressure on resources and improve social service delivery. Finally, fostering an enabling environment for businesses through infrastructure development, trade facilitation, and targeted subsidies for key industries can drive sustainable growth and improve Pakistan\u2019s economic trajectory.<\/p>\n
The writer is a Lahore-based economist working at the Centre of Economic Planning and Development, Minhaj University.
\nCourtesy<\/p>\n","protected":false},"excerpt":{"rendered":"
Waqas Shair Pakistan and Bangladesh share historical roots, language, and culture, having been one nation until 1971. Both countries began as agrarian economies with similar challenges of poverty, illiteracy, and political instability. However, their trajectories diverged sharply after Bangladesh\u2019s independence. For instance, in 1971, Pakistan\u2019s GDP was $10.67 billion, surpassing Bangladesh\u2019s $8.75 billion. By 2000, […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[13544],"class_list":{"0":"post-452392","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-article","7":"tag-waqas-shair"},"yoast_head":"\n