Published On : 30-Dec-2021
The nation of Bangladesh is nestled in South Asia between neighbours India and Myanmar. For decades, Bangladesh suffered economically and socially under the inefficient and repressive rule of Pakistan. In 1971, after the battle of liberation and subsequent change of power, Bangladesh reeled under dire straits. The nation was a poor, starving, agriculture-based economy with the 10th lowest GDP (per capita ba-sis) in the world.
Reforms, both political and economic have ushered Bangladesh to remarkable economic prosperity over the years. By 2015, Bangladesh had reduced poverty to about 14%, down from 44% in 1991. This has been supported by an increase in ex-ports, a bustling ready-made garments (RMG) sector and other industries. Their economic success is truly a role model for all least developed nations to emulate.
The Bangladeshi population, currently, enjoys a better standard of living, robust infrastructure, increased income and human development. The World Bank esti-mates that Bangladesh’s GDP has grown at 6% for the past two decades.
India and Bangladesh have very healthy trade ties. Their shared volume of trade surpasses that of any other two nations in the region of South Asia. India and Bang-ladesh’s ties are embedded in the cultural, linguistic and social strands of the two nations. There are, however, several points of contention among the neighbours, in-cluding the BSF’s shoot-to-kill policy and the commonplace Bangladeshi perception that the Indian government is Anti-Islam.
Overall, trade ties between the two nations remain unaffected by politics. Recent-ly, Bangladesh overtook Hong Kong to become the fourth largest export destination for Indian goods. The ease of logistics such as transportation and communication has helped Indian export to boom in Bangladesh. The product that saw the highest jump in demand was Rice(other than basmati) as the Bangladeshi government re-duced duties from about 62% to 25%. Other in-demand products include petroleum products and merchandise.
The nation of Bangladesh underwent economic liberalisation in the early 1990s. Since then, the manufacturing processes of the world’s top fashion brands have been shifted to Bangladesh. A great demographic dividend and close access to both the Indian and the Chinese markets are a couple of factors that have assisted in the trend. Besides, other top export destinations include the United States of America, Germany, United Kingdom, France and Spain. The top exports by category are as follows: machinery & nuclear reactors, vehicles, cotton, cereal, flour, milk and relat-ed products.
Bangladesh’s primary import products are raw materials meant for value addi-tion. The top categories are electrical and electronic equipment, iron & steel, plas-tics, manmade fibres, food grains and others. The countries that Bangladesh im-ports the most from are China, India, Singapore, Japan and Hong Kong.
Trading with Bangladesh gives Indian exporters a matchless opportunity. Besides strong diplomatic ties, Indian and Bangladesh have signed several trade agree-ments. This comes in handier if the newer variants of coronavirus affect more lock-downs. Due to the two nations’ proximity to each other, the transport of goods would remain largely unaffected.
The nation of Bangladesh is set to become a higher middle-income country in the upcoming years. The feat is a distant dream for all of its neighbours in South Asia. The country also ranks highly on the Human Development Index.
Bangladesh has a few hurdles to cross before it can become a truly global econo-my. Being one of the most densely populated nations in the world, Bangladesh struggles to make its cities more liveable and improve working conditions. With a young rising middle class and up-gradation of basic facilities, Bangladesh can be the economic marvel that takes the 21st century by a storm.
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