L 14. Class Version. DEV 101. Lecture 14. Development Strategies. Major Achievements and Challenges. Fall 2010

8/2/2019 L 14. Class Version. DEV 101. Lecture 14. Development Strategies. Major Achievements and Challenges. Fall 2010

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Lecture 14 (L 14)

Theme:

Development Strategies:Major Achievements andChallenges





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Development Strategies During the last decade Bangladesh’s economic and social

development achievements have been impressive:

GDP growth averaged 5% per annum Income poverty fel l from 59% to 50% Infant mortality halved Life expectancy increased from 56 to 65 years Annual export growth reached 11% Substantial employment generation taken place Income from remittances and peacekeeping equivalent to

50% of export earnings

All these have helped Bangladesh make a strong start inmeeting the Millennium Development Goals (MDGs)



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Development Strategies A Brief Historical Overview of Development

Strategies in Bangladesh:

Bangladesh has walked a long way to reach thisstage

It required various stages of development planningand strategies, formulation of policies and theirexecution

Five Year Plans (FYP) ADP (Annual Development Programme)



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Development Strategies Five Year Plans (FYP): Five Year Plans aimed at economic growth, resource mobilization,

public and private sector reform, infrastructural development,poverty alleviation, rural development, social upliftment, local

government development, etc.

First Five Year Plan (1955-60) Second Five Year Plan (1960-65) Third Five Year Plan (1965-70)

ADP (Annual Development Programme):

ADP was an organised list of projects in various sectors andallocations for them for one year out of a Five-Year Plan

Started since the First Five Year Plan (1955-60) of the provincial

government of East Pakistan



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Development Strategies Bangladesh Period:

Planning Cell under the Mujibnagar Government Planning Commission set up in 1972 Ministry of Planning Project Implementation Bureau (PIB) in January

1975 as a Division under the Ministry of Planning

ECNEC under the Ministry of Planning but chairedby the PM and co-chaired by the Finance Minister



Development Strategies Five Year Plans:

First Five Year Plan (1973-1978): relief and rehabil itation/GDP target 5.5% / Actual 4.0%

Two Year Plan (1978-1980): completion of incomplete projectsGDP 5.6% / Actual 3.5% Second Five Year Plan (1980-1985): rural development/

GDP 5.4% / Actual 3.8% Third Five Year Plan (1985-1990): poverty alleviation & economic growth/

GDP 5.4% / Actual 4.15% Fourth Five Year Plan (1990-1995): poverty alleviation & economic growth/

GDP 5.0% / Actual ? Two Ad-hoc Plans (1995-97): poverty alleviation & economic growth/GDP ? / Actual ?

Fifth Five Year Plan (1997-2002) poverty alleviation & economic growth/GDP 7.0% / Actual ?

Sixth Five Year Plan (2002-2007) poverty alleviation & economic growth/GDP 7.0% / Actual ?



Development Strategies PRSP (Poverty Reduction Strategy Papers):

What is it ?

Macroeconomic, structural and social policies and programs of acountry

To promote growth and reduce poverty Prepared by the government But done through a participatory process Civil society, domestic stakeholders l ike NGOs, community

organisations, trade unions etc. Foreign development partners like the World Bank and the IMF are

also involved A country needs a national PRSP to apply for debt relief, new

credits, loans and grants from the World Bank, IMF and donorcountries



Development Strategies Why Needed?

PRSP provides a roadmap indicating the priorityactions to achieve poverty reduction

The national budget of a country allocates thefinance for it

International donors also support the PRSP and

add to the governmental budget PRSP is updated every three years with annual

progress reports Today, PRSP processes can be found in almost 70

countries worldwide



Development Strategies

How does the PRSP process work?

The stages of the PRSP process



Development Strategies Interim Poverty Reduction Strategy Paper (I-PRSP)

titled ‘A National Strategy for Economic Growth,Poverty Reduction and Social Development, 2003’

‘Poverty Reduction Strategy Paper Status Report’,August 25, 2004 (PRSP I)

Poverty Reduction Strategy Paper, titled‘Bangladesh Unlocking the Potential’, October 2005(PRSP II)



Development StrategiesTarget Setting on Major Goals against 2002 Benchmark

Indicators 1990 2002 Annual Progress 2015Annual Progress

Benchmark Over 1990-02 (%)Over 2002-15 (%)

Income-Poverty (%) 59(50) 50*(40) -1.5(-1.9) 25(20) -3.3(-3.3)

Extreme Poverty (%) 28 19* -3.2 9.5-3.3

Adult Literacy (%) 35 49.6 3.5 906.3

Primary Enrolment (%) 56 86.7 4.6 1001.2

Secondary Enrolment (%) 28 52.8 7.4 956.1

Infant Mortality Rate 94 53 -3.6 18-5.1

(per 000 live births)

Under-Five Mortality Rate 108 76 -2.5 25-5.2

(per 000 live births)Maternal Mortality Rate 554 390 -2.5 98



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Development Strategies Rural Development: Definition and Aims:

Planned change towards the improvement of the economic and social

l ifestyle and the well being of the rural people A planned change can be of two kinds:

rural institution-building advancement in technology

How this change can be achieved ? – The Aims: increased production

equitable distribution of scarce resources

Wider employment opportunities

empowerment - economic and polit ical power to the rural masses in

annin ecision-ma in im ementation rocess ene it s arin



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Development Strategies History of Rural Development Policies and Strategies:

V-AID Programme, 1953: Vil lage Agricultural and IndustrialDevelopment Programme by Pakistan Government

V-AID covered all major sectors of rural development like agriculture,primary education, health, sanitation, cooperatives, land reclamation,physical infrastructure, social and recreational activities, etc.

Comilla Cooperative Approach:

It was engineered in early 1960s by the Pakistan Academy of RuralDevelopment later renamed as Bangladesh Academy for RuralDevelopment (BARD)

The man behind this new model was Akhter Hameed Khan An integrated rural development approach was made and projects

taken accordingly



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Development Strategies The Comilla Model had four constituent elements :

Rural Works Programme (RWP) - build communication and drainage network

Thana Training and Development Centre (TTDC) - train vil lagers Thana Irrigation Programme (TIP) - provide irrigation facil it ies to farmers

Two-tier Cooperatives to promote cooperation among vil lagers

a. TCCA: Thana Central Co-operative Association at the thana level

b. KSS: Krisak Samabaya Samity at the vil lage l evel



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Development Strategies Rural Development: Bangladesh Experience:

Since birth Bangladesh has witnessed ceaseless experimentation

with varied rural development approaches In 1972, the government activated the Integrated Rural

Development Programme (IRDP) to replicate and expand the Comilla

Model in other parts of the country

The whole programme was later transformed into an institution

called Bangladesh Rural Development Board (BRDB)

The BRDB eventually became the largest government organisation

involved in rural development



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Development Strategies Experiments with various rural development

programmes:

Swanirvar (self-reliance) Movement, 1975 Comprehensive Vil lage Development Programme, 1975 Swanirvar Gram Sarkar, 1976 Upazila System, 1982 Small Farmers Development Programme, 1993 Vulnerable Group Development Project Thana Resource Development and Employment Project Rural Social Service Programme Community Development Programme Self-rel iance Programme for Rural Women, etc.



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Development Strategies Achievements in rural development programmes:

During the last two decades or so, Bangladesh has made commendable progress in

selected fields of development, especially in agriculture, human resources

development, and community focused health services

The achievements also include

a remarkable increase in rice production and development of High Yielding Variety of rice

expansion of agricultural extension and institutional networks

wide coverage of immunization programmes

primary education programmes and reduction in illiteracy rate

reduction in the population growth

some development in communicational infrastructure building and

finally, a considerable degree of women’s involvement in income generating activities through

awareness building and mobilising efforts





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Development Strategies Industries marked by notable development included automobiles

(assembly), oil refinery, insulators and sanitary wares, telephoneequipment, electrical goods, televisions (assembly), cigarette, andvegetable oil, etc

But in the overall performance of the industry sector the Ready MadeGarments (RMG) industry has started playing the most dominant rolein the industrial production and export

Consequently it has become Bangladesh’s prime export earner makingthree-quarters of all registered exports by 2006 replacing thereby juteand jute goods as top export items

It has also become an important employer by employing in 3,000

factories around 1.5 million workers overwhelmingly women



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But given the fact that the export base itself is narrow, the industrial sector

of the country is too heavily dependent on one export item only – the RMG

The performance of the industrial sector so remains vulnerable tounfavourable changes in the external sector or unexpected polit ical crisis

internationally to adverse developments

So a more diversified and modern industrial and export base is needed

Hindrances to the industrial growth include slow pace of privatization,

problems of industrial finance, infrastructural bottlenecks, particularly those

relating to transportation, port facil it ies and power supply, lack of skil led

workers, deficient technology, the law and order situation, corruption and

bureaucratic red-tapism etc are some of the main factors that are holding

back the development of the sector



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Development Strategies: Agriculture Policies:

General Features:

Crops:

Nearly 100 different kinds of crops are presently grown in Bangladesh

Rice is the principal one which grows in all the three crop growing seasons of the year

Rice covers about 79% of the total cropped area (about 13.4 million hector)

High yielding varieties cover more than 50 percent of the total rice area

Other important crops are wheat, jute, potato, oilseeds, pulses, tobacco, cotton, sugarcane, fruits,

vegetables

Agriculture Labour Force:

According to Bangladesh Bureau of Statistics in 1995/96 63.2% (34.5 out of 56.0 million) labour force of

Bangladesh were engaged in agriculture

18% of them were paid day-labourers

82% comprised the cultivators themselves and unpaid family workers



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Agricultural Policies: Early Phase:

East Pakistan Agricultural Development Corporation (now

BADC)

East Pakistan Agricultural Bank (Now BKB) established in

early 1960's

Subsidies to inputs (seed, ferti l iser, pesticide, agrimachinery, etc)

Comilla Model boosted agricultural production through

‘seed-water-ferti l iser technology’



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Green Revolution:

Began in the early 1960s and continued up to the 1970s (first used in 1968by former USAID Director Will iam Gaud)

Sponsored by international funding agencies and USA it aimed mainly at

developments in agricultural production. It emphasized three areas:

hybrid or high-yielding varieties of seeds of wheat, rice and corn (maize)

pest control by use of heavy doses of pesticides or chemical ferti l izers

mechanization of agriculture l ike dril l ing of thousands of wells for controlled

irrigation



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Green Revolution nearly doubled wheat production in Pakistan in

five years from 4.6 million tons in 1965 (a record at the time) to 8.4

million tons in 1970

International Rice Research Institute (IRRI founded in 1960)

developed high-yielding varieties for rice named IR8, which doubled

yields and became known as "miracle rice" and so served as the

catalyst of the Green Revolution

IRRI varieties soon became important rice varieties in East Pakistan

The Green Revolution is generally considered to have averted

famine in India and Pakistan



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Agricultural Policies: Bangladesh Period:

Bangladesh government continued the subsidy policy to farmers during the

first few years

But later shifted to laissez-faire economy and curtailed the monopoly of

BADC

Price subsidy for all fert i l izers was 68% in 1973/74 but decreased to 47% in

1979/80 and was fully withdrawn after 1980

But later BADC was allowed to distribute ferti l izer through select dealers

and fixed its price also

Also policy of l ift ing restrictions and taxes (fully and partially) from import

of irrigation machinery proved very conducive to the expansion of irrigation



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Other policies included

Disbursement of micro-credit

rescheduling of agricultural loans of indebted farmers

remission of land taxes for holdings up to 25 bighas

crop diversification programmes

special programmes for disaster-stricken farmers

Results of these pol icy measures:

Improvement of the food situation in Bangladesh

Food grain production increased to 24.3 mill ion tons in 1999/2000

This matched the annual consumption requirement of the population



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National Agriculture Policy, 1999:

Announced in April 1999

Attain self-reliance in crop production

Develop crop agriculture

Crop diversification

Improve the nutritional status in the country Improve seed distribution programme of BADC

Private sector to take part in the production, import and marketing

of seeds



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Private sector to continue distribution of ferti l izers

Public sector also to import ferti l izers, if necessary

Promote appropriate technology to increase irrigated area

and reduce irrigation cost

Mechanization of agriculture and credit facil it ies for the

purpose

Integrated Pest Management (IPM) for environment-friendly

and sustainable agriculture and chemical pesticide harmful

to the environment would be discouraged and eventually

banned



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Agricultural Credit:

Attempt to mobilise more resources as agricultural credit to meetthe increasing need of farmers

Specialised banks like Bangladesh Krishi Bank, Rajshahi Krishi

Unnayan Bank, Bangladesh Cooperative Bank, commercial banks like

Sonali, Janata, Agrani and Rupali Banks, and Bangladesh Rural

Development Board (BRDB) were used to meet the needs of farmers



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Food Security:

In its simplest form, food security means that all people have enough to eat at all

times to be healthy and active, and do not have to fear that the situation will change

in the future

Three fundamental pil lars in achieving food security are

food availabil ity: sufficient food must be grown to ensure that everyone can be

adequately fed

access to food: economic and physical that food is available at all marketplaces

food util ization: bring together both the quality of food and other complementary

factors such as safe water to ensure adequate nutritional outcomes of every individual



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Bangladesh has long been trying to achieve food security and

succeeded

Rice production increased Almost three times as much rice per land unit is produced as in the

1950s• 1990 : 2,000 kg per hectare• 2005 : 2,400 kg per hectare

In total volume:• 1970s : 12 million tons• 2000 : 23 million tons Gained self-sufficiency in food-production for the first time in 2000



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0

50

100

150

200

250

300

350

I n L a k h M e t r i c T o n

FY 05 FY 06 FY 07 FY 08

Production TargetNet Domestic Production

Food Grain Production



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Main three rice crops are high-yielding rice varieties:

autumn rice aman

winter rice bo r o

summer rice au s

Rice boom has prevented mass starvation

But has it finally ensured food to all three times a day ?

Has it succeeded to raise the standards of the riceproducers ?



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Export oriented Entrepreneurialism inBangladesh:

Stellar performance of the garments industry(RMG):

Took off in the 1980s Exporting garment items mostly to USA

(43.24% /1998-99 ) and European Union(52.38% /1998-99 )

Producing textiles for world market after alapse of two centuries





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Its contribution to Women Empowerment:

The expansion of the RMG industry has caused noticeable

social changes in the l ives of its female workers Importantly it has brought more than 1.5 mill ion women into

labour force The economic empowerment of these working girls/women

has changed their status in the family

It has changed the tradit ional patriarchal hegemony of thefathers, brothers and husbands Most working women/girls can now chose when and where

to get married or become mothers The number of early marriages and divorces is decreasing;

so is the birth rate



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The working girls tend to send their l i tt le bothers andsisters to school, as a result, the l iteracy rate is increasing

They can also participate in family decision-making RMG industry has also produced a group of entrepreneurs

who have created a strong private sector and of them asizeable number is female

Many women hold top executive positions in RMG industry Sti l l no better opportunities for women to earn the

equivalent of $ 20 per month BGMEA is the organisation of the garments owners and

exporters of Bangladesh The labourers have their trade unions or CBAs to bargain

with the owners and the government



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Problems:

Highly dependent on imported raw materials and accessories Conditions in the factories are appall ing Very low wages Long working hours Health risks in hazardous working condition Life security

Child labour Underdeveloped infrastructures l ike poor power supply,

transportation and communication, inadequate portfacil it ies, etc

Increasing competition with powerful suppliers outside Polit ical unrest



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RMG Sector



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Export of Human Resources:

Labour migration: General Facts:

Labour migration to Britain during the British colonial rule asservice personnel and attendants

From mid-70s Bangladeshi labour migration to ME began This later was expanded to South-East Asia, Europe and North

America

Manpower export viewed as a mechanism of reduc ing unemployment Also regarded a means of earning foreign exchange In 1975 only 765 Bangladeshis went abroad for employment which

became 6,087 in 1976 Ten years later in 1986 it became 68,628 and rose to 268,182 in

1999



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Why do Bangladeshis migrate ?:

Unemployment

Lack of job opportunity

Poverty particularly in the rural areas

Better opportunities

Political pressure



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Official Institutions and Policies:

1. Government Ministries: a) Ministry of Labour and Employment (until 2001)

b) Ministry of Expatriates’ Welfare and Overseas (from Dec

2001) to create overseas employment opportunities

to address problems experienced by expatriates and to ensure their welfare

2. Government Agencies:

a) Bureau of Manpower, Employment and Training (BMET)

o Created in 1976 as the executing agency of the Ministry for processing labour

migration

o Responsible for a wide range of functions as control and regulation of recruiting

agents, analysis of labour market, registration of job seekers, training programmes,

resolving legal disputes, etc

b) Bangladesh Overseas Employment Services Limited (BOESL)



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Official Institutions and Policies:

3. Private recruiting agents and their local and international intermediaries:

Active since 1981 and work under license from the government

On their own they collect information, obtain permission from BMET, recruit workersand execute the procedures involved in their deployment

Organized (Dec 1984) under Bangladesh Association of International Recruiting

Agencies (BAIRA)

By 2002, it had a membership of around 700 agencies

4. Potential migrants and their families: About 55-60% of recruitment is conducted through individual initiatives and social

networks

Usually, persons already deployed in the host countries arrange them

Here migrants pay less than paid to the formal recruiting agents and risk of fraudulent

practices is also considered to be less



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Bangladeshi migrants and immigrants





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Number and Volume of Remittances:

Of the Bangladeshis leaving for employment abroad in 1990:

About 65% were unskilled or semi-skilled workers 6% construction labour

6% vehicle drivers

8% technicians

5% catering workers an

10% professionals including engineers, doctors and teachers

But this composition shifted towards an increased share of workers

and in 1997, about 90% of them were workers



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Foreign remittance situation in Bangladesh:

In 1976, remittances or money sent by Bangladeshis working abroad

reached Tk 760 mill ion

In 2010 it reached the $ 10 bil l ion mark o r about 700 bil l ion taka

According to a Bangladesh Bank estimate:

1980 : $ 0.2 bil l ion Early 1990s: $ 1 bil l ion 2006 : $ 5 bil l ion (around $ 40 per inhabitant or four times the

amount of foreign aid per inhabitant) 2008 : $ 8 bil l ion nearly 2010 : $ 10 bil l ion mark expected



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Three kinds of Bangladeshi migrantssending remittances :

overseas labour migrants

middle-class educational and job

migrants unauthorized labour migrants to

neighbouring countries



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0

1

2

3

4

5

6

7

8

9

FY 02 FY 03 FY 04 FY 05 FY 06 FY 07 FY 08

U S

D O l l a r ( I n B i l l i o n )

Remittance Flow: Bangladesh



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Impact of Migration and Remittances:

Vast amounts of money remitted throughnon-official channels bypassing bankingsystem

Economy so is now remittance-dependentrather than aid-dependent

Migration develops new forms of businessand entrepreneurship, transfer oftechnology, and exchange of culture

It creates domestic employment also



Documents

L 14. Class Version. DEV 101. Lecture 14. Development Strategies. Major Achievements and Challenges. Fall 2010