Bangladesh still has a long way to go despite progress on social and economic fronts, said Kaushik Basu, chief economist of the World Bank.
“You cannot sit back. There should be no room for complacency,” he told The Daily Star in an interview before he wrapped up his four-day visit to Dhaka.
He met top government functionaries, including the prime minister and the finance minister.
Basu also delivered a public lecture, visited a garment factory on the capital’s outskirts and saw Bangladesh’s efforts in financial inclusion.
More importantly, he got to see first-hand the transformation the country has gone through since 1992, when he first visited Bangladesh.
It is about time that Bangladeshis believe that their country is on an upward trajectory, he said. “When you realise that, it changes the mindset. People get enthused and begin to participate in the process.”
Basu, who is also the senior vice-president of WB, said Bangladesh stands out globally with its numbers for the last couple of years, citing the country’s growth rate, increasing foreign currency reserves and rising life expectancy as examples.
In terms of economic growth, the country is among the top ten, which, he said, is a remarkable achievement.
However, Bangladesh, which has just recently graduated to the lower middle-income bracket, continues to be a poor country: there are people who are still suffering, he said.
To expedite economic advancement, it is important to address some of the major obstacles.
Basu said the country is virtually on an auto pilot to 6.5 percent growth. But to switch to a higher gear, there are two important areas where it must do better: infrastructure and the ease of doing business or the transaction cost of bureaucracy.
If the country can address these bottlenecks without further delays, it will get to the 8 percent growth trajectory within the next three-four years, according to Basu.
“You need better road connectivity. You need better ports where big ships can come and very quickly offload their goods.”
Then more ships will want to come to Bangladesh if they know they will not have to spend too much time waiting for offloading.
Bangladesh has done very well in energy over the last six years. Still, there is a great distance to go, he said.
“Again, I will stress that working with the region — with Nepal, Bhutan and India — is extremely important. And working together can lead to doing better in terms of infrastructure.”
Basu, who is the first WB chief economist from India, also emphasised easing the business processes and costs.
“Regulation is important. No modern society can run without regulation. There will be laws. There will be regulations. But the government has to work hard to make it quick and efficient.”
He said governance and corruption are issues that all developing countries face, and efforts must be made to curb that as much as possible.
On rising religious militancy in the country, he said: “This is not a problem specific to Bangladesh. This is a worldwide problem today.”
In today’s globalised world, a major economic crisis 5,000 miles from Bangladesh can affect its economy as well, Basu said.
“For instance, the Middle Eastern situation is very volatile right now. If that becomes even more politically volatile, it is going to affect the United States. It will then affect Argentina and China. It will affect Bangladesh.”
He said the WB is very aware that the global growth could slow down if the political risk increases.
Basu is also upbeat about the benefits of regional connectivity, particularly in South Asia.
Connectivity is very poor in South Asia in terms of trade and other forms of cooperation, he said.
“For a very long time, very little has happened. But what is also true is that over the last year there have been signs, for instance, between India and Bangladesh, of very desirable developments. And one keeps one’s fingers crossed that this will only increase with time.”
If there is greater connectivity between the South Asian countries, it will be beneficial for all. “Life is not a zero-sum game — all countries will benefit from this.”
