Illustration: Ramandeep Kaur
Illustration: Ramandeep Kaur | ThePrint
Text Size:

The country of the moment is the one that exports “termites”: Bangladesh. On the first of my two visits to that country, in the mid-1990s, the only direct flight from Delhi to Dhaka was one that Biman Bangladesh Airlines originated from London. In business class, one confronted a toilet that was locked. “Reserved for VIPs,” said the plastic panel pasted on the door! Non-VIPs in business class had to use toilets further back in the plane. Dhaka city had two good hotels and was over-run with cycle-rickshaws, while the cars were dated Japanese models. They were cheap because Japan’s rules mandated an expensive overhaul of any car beyond its initial life, and many owners preferred to trade them in for new vehicles instead. The “pre-owned” ones were exported, without the cost of overhaul, to poor countries in Asia.

There was a sprinkling of Indian businessmen who had set up garment businesses, importing raw materials from India and using Bangladesh’s export quotas to sell to Europe and elsewhere. The ubiquitous presence was of foreign-funded NGOs, while the macro-economic story was like India’s on reforms. The finance minister, Saifur Rehman, whom one met in the eye-catching but grimly modernist assembly buildings designed by Louis Kahn, was a Manmohan Singh-style reformer (they were born in the same year, within a few days of each other, and held office coterminously as finance minister). Rehman, under Khaleda Zia, had launched a more convincing privatisation programme than India’s reluctant “disinvestment” push, and the country was doing quite well on many parameters, except growth — where India outpaced it.


Also read:Why India has increased economic freedoms in response to Covid, unlike Europe & US


Travelling around the countryside, one found that the railway system was as decrepit as India’s, while the roads coming in from the border with India had a stream of trucks carrying cattle — presumably for slaughter. The newspaper and magazine stalls were full of Bengali publications from India, but the country’s national day celebrations found virtually no mention of the Indian Army’s role in getting the country its freedom — which irritated India’s diplomats. The only place where you saw a picture of Pakistan’s Lt Gen. Niazi surrendering to India’s Lt Gen. Aurora was in the Indian High Commission. Bilateral trade was hopelessly one-sided in India’s favour, but India’s trade negotiators would yield no ground. Still, one left with the impression of a country that was taking the first steps to getting somewhere.

Amartya Sen was one of the early birds to catch on that Bangladesh had started doing better than India on the health metrics, but on years of schooling, India has continued to do slightly better. Since 1971, Bangladesh’s population has multiplied 2.5 times (as has India’s), while Pakistan’s has multiplied 3.5 times. Bangladesh’s population growth would have been somewhat faster without the steady outmigration to India’s border districts.

Bangladesh’s performance on the social indicators was notable because its per capita income (measured using purchasing power parity) was barely half India’s at the time. It has improved sharply to 80 per cent while, as the IMF’s latest forecast says, its per capita income in nominal dollars is expected to move fractionally ahead of India’s this year. Ever prescient, Shankar Acharya had predicted this a few years ago. It seemed quite a distant prospect, given India’s steady growth clip at the time. But India has slowed while Bangladesh accelerated till Covid struck the two countries differentially and closed the gap. Crucially, the taka has gained a third in value against the rupee since the onset of the 2008 financial crisis. That boosts Bangladesh’s GDP in dollar terms, which is what the IMF tracks.

The stronger taka does not necessarily reflect better merchandise trade performance, despite Dhaka’s success with garment exports. As with India, merchandise imports are about 50 per cent bigger than exports, but in relative terms, Bangladesh benefits from much higher remittance inflows (close to 6 per cent of GDP, double India’s number). India’s economy and trade mix are more diversified, with better balance also in inflows between remittances, portfolio capital, and foreign direct investment. So don’t bet just yet on Bangladesh as South Asia’s economic champion, unless you believe that India will continue to under-perform.


Also read: Covid is declining, Modi govt is trying to get it right on the economy. End of the beginning?


 

Subscribe to our channels on YouTube & Telegram

Why news media is in crisis & How you can fix it

India needs free, fair, non-hyphenated and questioning journalism even more as it faces multiple crises.

But the news media is in a crisis of its own. There have been brutal layoffs and pay-cuts. The best of journalism is shrinking, yielding to crude prime-time spectacle.

ThePrint has the finest young reporters, columnists and editors working for it. Sustaining journalism of this quality needs smart and thinking people like you to pay for it. Whether you live in India or overseas, you can do it here.

Support Our Journalism

24 Comments Share Your Views

24 COMMENTS

  1. I love Indians! So busy making excuses and beating their chests, they missed the unassuming Bangladeshi‘a overtaking them. Keep making excuses and beating your chests. Soon you’ll be asking us to bail you out lol!

  2. The statement which had to be the topic of the whole article was simply just repeated at the end of the article , without delving into it at all ! Poor quality article I must say .

  3. Worst article. Calling a country as Termite exporting. And talking about the experience one had 25 years back and having opinion on current status. Worst.

  4. Did print approve an article calling Bangladesh as termites exporting country? Based on decades old personal experience of a bigot who wants to put his personal views on top of facts?

  5. In any case the matter of measuring GDP – and handling dynamic statistics – et al is under review the world over. Probably we will have to lace logic with statistics. Data analytics has overtaken the traditional treatment to statistics. Be that it may…

    This whole revelation of BD doing well, makes me wonder, why then is there illegal immigration from BD into India? Thorugh border districts into hinterland. Just asking.

      • Because there isn’t. The migrations happened mostly during wartime, a very big migration. No one would want to go to Assam now with a state GNI of $1100 or even WB at $1500. But yeah keep believing that people are still coming in.
        A lot of people do try to take advantage of the Indian market, but that isn’t migration. Read a story another day where a Bangladeshi woman was trafficking young girls into India, a vile crime. She was basically taking advantage of the Indian consumer market. Should be stopped.

  6. Is the author high on drugs? Cmon accept the fact that you are poorer than an Average Bangladeshi Cycle-Rickshaw puller

  7. It is strange to observe this plight of TNN, where since the last few articles he has been making these half hearted and half baked attempts to defend the ineffective governance since the last six years and the disastrous consequences. So what if Bangladesh is not going to overtake India’s per capita GDP and India’s economy is more complex? Is that satisfactory or appreciable? Where are we in terms of the human development we need to achieve? Especially vis-a-vis the promises and the boasting of this government and their bad mouthing of others? Wonder what is compelling TNN to make such attempts!

  8. Bangladesh is doing well on the garments, that is obvious because the number of brands have made in Bangladesh tags, cost of labor being the most likely reason just as there are made in Sri Lanka tags. In the mid nineties till the garment quota system was done away under WTO we had a huge garment export industry, basically out of Tirupur.This was based on the quota purchasing manipulations and not on cost efficient production. So the minute the quota regime got over so did the exports we never worked to retain the market we had.
    There is a big talk about the MSMEs, do we have a break up of how many MSMEs are supporting the big industry and how many are stand alone like the garments? Of course we are not best at keeping authentic data, because only in absence of it can people allege whatever they want.
    The MSMEs which support the major industries will exist only when the major industries will place the orders, just pumping in money in such MSMEs will not revive them. Again the stand alone MSMEs will exist only when the demand is there. Till then probably the push to major industry through government orders for defense, and infra may be the only solution.

  9. I hold TNN in high regard and much of his economic commentary historically has been fairly insightful. However, this article, I’m afraid, is very banal. It just reminisces about his trips to Bangladesh around 25 years ago, mentions two economists that had predicted this would likely happen, and avers in a couple of sentences that India’s trade mix is more robust than Bangladesh’s.
    What the article doesn’t do is provide any insight on what Bangladesh has been doing with its economic and social policies that have worked for it, and what about them is or isn’t sustainable.
    To Bangladesh’s credit it has focused on the sectors where it has comparative advantage – manpower intensive industries such as textiles, cycles, manufacturing etc. India on the other hand, in its quest for greatness, is trying to focus on high value engineering, IT, chemicals, manufacturing and service sectors that are gradually automating, instead of leveraging the massive labour force available at relatively cheaper cost to promote labour intensive manufacturing, like Bangladesh is doing. Nothing (other than politics, lack of social harmony and poor governmental restrictions/regulations) can stop India from doing what it can do best – offer best-in-class IT services as well as manufacture globally competitive manpower intensive products. Both these are manpower intensive (across productivity, skill and efficiency levels) that can ensure employment for the large labour force leading to growth in incomes, education, health and overall well-being.

  10. In any case the matter of measuring GDP – and handling dynamic statistics – et al is under review the world over. Probably we will have to lace logic with statistics. Data analytics has overtaken the traditional treatment to statistics. Be that it may…
    This whole revelation of BD doing well makes me wonder; why then is there illegal immigration from BD into India? Though border districts into hinterland). Just asking.

  11. They export more than Termites, FYI.
    Such a disgraceful start of the piece by this author. That first line shows the intent of such piece.

    The very country is also deploying its navy for th UN Peace Keeping Operations. That’s also a unique thing, because even its largest neighbor doesn’t deploy :/

  12. Probably one of the worst pieces of writing showcasing the lack of reality that is today. The author claims last to have visited the country in the mid 90s – yet 50% of the articles speaks about his experience during that time. I have visited Bangladesh several times on business in the last couple of years and things have vastly changed – especially in and around Dhaka. There is growing prosperity among the middle class and the divide between haves and have nots has come down significantly.
    Request the print to please look at the motives – such articles further highlight our entitled view of our immediate neighborhood. This should be an opportunity to look in the mirror and reflect rather the deflect.

    • I think you address a very important aspect of Bangladesh’s rise. Income parity. The gap really has bridged a lot over here.

  13. Out of total 6 paragraphs, the first 3 longer paragraphs have basically nothing to do with the story being discussed here. Remind me of my time when I used to write something something to cross 1000 word limit in my essays.

  14. TNN seems to have been irked by comments on the IMF report by local sickulars like Sekhar Gupta or international sickulars like Andy Mukherjee! (I trust he is not too bothered by Rahul though) Each one is giving their own twists to the story to suit the anti-Modi narrative and take favorite pot shots. Anyway, TNN needs to be commended for putting the things in a balanced perspective. Bangala Desh is our neighbor and it must do well even if it does better than us. (And hopefully, termites will turn back to their burrows !!)

    There is no doubt that Modi has to do a lot and a lot more to improve the economy. He has taken some steps which are clearly not enough. And thhere is always ‘Dil Mange more’. But he is on course and hopefully, things should get better. Of course, we have Rahul waiting in the wings in case Modi fails..!!

  15. The author is right. But what the IMFs projections do is show us the mirror. That economic growth has to be made priority again if we are to grow as per our aspirations and need. We still have millions to be lifted out of poverty, generate enough wealth to invest in defence, edu, health, infra.

  16. Why is Mr Ninan even writing this article? And worse still, why is Print publishing it?

    Sorry to say, very poor article, written in an even poorer taste.

LEAVE A REPLY

Please enter your comment!
Please enter your name here