Nobel Peace Prize laureate Muhammad Yunus speaks to reporters after being granted bail in Dhaka on Jan. 28. Many critics believe Bangladesh’s government is using the power of the law to discredit a man once seen as a potential political rival. © AP
DHAKA — Years of tension between the government of Bangladesh Prime Minister Sheikh Hasina and the country’s only Nobel laureate, Muhammad Yunus, are coming to a head, with the 83-year-old economist facing an ever-growing list of legal entanglements.
Yunus in the past two months has been slapped with a $5 million tax bill, a travel ban and a suspended jail sentence for allegedly violating labor laws, on top of well over a hundred pending cases against him.
Earlier this month, unidentified officials claiming to be from the flagship organization he founded, Grameen Bank, reportedly seized his office building in Dhaka, which houses several of his other operations. In 2006, Yunus and Grameen Bank won the Nobel Peace Prize for helping the poor escape poverty by granting small loans, known as microcredit.
In a rare news conference on Feb. 15 — his first in Dhaka in over a decade — Yunus expressed shock and disappointment over the office raid. “We have faced many challenges but never have we seen such a disaster where people come from outside and take control of our office building,” he said. “It’s like being thrown out of your own house by unknown men.”
Yunus said his pleas for law enforcement intervention had gone unanswered.
The picture only turned bleaker for Yunus last weekend, when Grameen Bank confirmed that its board had ousted him from two businesses he founded: Grameen Telecom and health care provider Grameen Kalyan. Grameen Telecom is one of Bangladesh’s richest companies and owns a 34% stake in Grameenphone, the country’s largest telecom operator.
The government insists it has nothing to do with Yunus’ recent woes. But many analysts say the pressure stems from a perceived political threat he posed a decade and a half ago.
In 2007, riding the momentum from his Nobel triumph, Yunus sought to establish the Nagorik Shakti party, raising his profile and sparking speculation about his own political ambitions. Although he quickly dismissed any intention of running for prime minister, experts say this brief foray made a lasting impression on Hasina and her Awami League, which came to power in 2009.
Hasina over the years has been sharply critical of her would-be rival, accusing him of “sucking blood from the poor” while heading Grameen Bank.
On her watch, Bangladeshi authorities have launched multiple investigations against Yunus, culminating in his removal as Grameen Bank’s managing director in 2011 due to alleged violations of retirement rules. Further accusations of unauthorized foreign funding, including his Nobel Prize money and book royalties, were leveled against him two years later.
“One might well disagree with professor Muhammad Yunus on the efficacy of microcredit,” Bangladeshi human rights activist Shahidul Alam told Nikkei Asia. “But to use the full might of the state machinery to persecute an individual simply because of a personal vendetta is blatant abuse of power.”
Today, Yunus faces more than 160 cases, including alleged tax evasion. His supporters as well as independent observers claim most if not all are politically motivated.
Hasina’s law minister, Anisul Huq, told Nikkei Asia that the government had no role in “any activity that had happened with Grameen Bank” recently. “The lawsuits against [Yunus] were also filed by the country’s revenue board and anti-corruption body. They operate independently. We don’t have any role in it.”
But Dhaka University law professor Asif Nazrul highlighted an “unusual rush” in these proceedings compared with the typical slow pace of labor law enforcement. “Consider the Rana Plaza or Tazreen Fashion cases, in which hundreds of laborers died because of the owners’ alleged negligence,” Nazrul said. “But very little progress has been made in those cases. Whereas in cases of Dr. Yunus, the courts seem unusually proactive.”
Yunus has asserted that Grameen Bank lacked legal authority to seize his office and operations, emphasizing the independent nature of the affected companies. He also argued that recent appointments of directors to take his place at Grameen Telecom and Grameen Kalyan were evidence of attempts to undermine his social enterprises and harass him.
His woes have drawn international attention. The United Nations on Sunday expressed concern over “recent incidents” involving Yunus, terming him a “valued partner” for achieving Millennium Development Goals and Sustainable Development Goals. Meanwhile, the U.S. warned that the Grameen office raid could hinder foreign direct investment in Bangladesh.
Some experts believe the pressure on Yunus has been cranked up after the U.S. and other governments tacitly accepted the early January election that returned Hasina to power for a fourth term. Like previous elections, the polls were marred by an opposition boycott and allegations of widespread irregularities.
Western governments, particularly Washington, had voiced concerns about the democratic process in Bangladesh leading up to the election. Afterward, they issued muted criticism while pledging to continue cooperation with Hasina’s government.
Political analyst Rezaul Karim Rony believes this “emboldened the government to crack down on Yunus,” who is known for his close ties to Western countries. “And it seems the Western countries have very little power to change the course here.”
Michael Kugelman, director of the South Asia Institute at the Wilson Center in the U.S., offered a more nuanced view and stressed that the West has not abandoned Yunus. But he arrived at a similar conclusion.
“Yunus continues to enjoy the luxury of many powerful friends abroad who will use their prominent platforms to keep advocating for him,” Kugelman said. “That said, their leverage is limited, and especially because Bangladesh is not feeling the heat from Western capitals that much these days.”
He observed that Western powers have indeed stepped back from pressuring Dhaka on democracy issues since the election. “This has emboldened the Bangladeshi government and given it more space to tighten the screws on Yunus.”
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