Structural Transformation of Bangladesh Economy, 1st ed. 2021 A South Asian Perspective South Asia Economic and Policy Studies Series

The analysis highlights several distinct characteristics of Bangladesh?s structural transformation including changes in value added, trade, employment, productivity, formal-informal jobs, and opportunities for low-skilled workers. The book suggests that the manufacturing sector could not create the required number of jobs and generate rapid absolute and relative productivity gains in the Bangladesh economy. Although the services sector has largely led output and employment growth, services subsectors with strong labour absorptive capacity have low average productivity. Hence, growth-enhancing structural transformation led by these subsectors is likely to be less dynamic than required for rapid employment-creating growth in the economy.

The book?s analysis on COVID-19 and cyclone Amphan shows that an integrated disaster and development paradigm is needed for Bangladesh. An inclusive and health and well-being focused structural transformation presents the pathway to advance the people-centred approach to development in Bangladesh through both vulnerability reduction and investments in sustainable development that would offset both known and unknown disaster threats. The key for Bangladesh is to skillfully manage the ?developer?s dilemma? of achieving both structural transformation in terms of large productivity gains and inclusive growth for reducing poverty and rising inequalities. This book is relevant to students, academicians and development practitioners and others interested in contemporary development.

1.1  Introduction

1.3  Bangladesh’s Structural Transformation

1.4  Primacy of Equality Horizon

1.5  Organisation of Chapters

Chapter 2: Structural Transformation: Theory and Global Evidence

        2.2 Measures of Structural Transformation

        2.3 Gains from Structural Transformation

        2.4 Structural Transformation: Global Trends

               2.4.1 Historical Trends of Developed Countries

               2.4.2 Recent Trends in Developed and Developing Countries

               2.4.3 Structural Transformation and Premature Deindustrialisation

         2.5 Structural Transformation and Development Theory

                2.5.1 The Neoclassical Growth Models

                2.5.3 The New Structural Economics

                2.5.4 Revival of New Latin American Structuralism

                2.5.5 The Value-Chain Approach

                2.5.6 Resource-based Industrialisation

         2.6 Empirical Evidence on Structural Transformation

                2.6.1 Manufacturing as Engine of Economic Growth

                2.6.2 Effect of Structural Transformation on Labour Productivity

                2.6.4 Industrial Upgrading within Value Chains

          2.7 Premature Deindustrialisation: Role of Services Sector

          2.8 Structural Transformation and Development

                 2.8.1 Structural Transformation and Labour Market Changes

          2.9 Structural Transformation, Employment and Poverty

                 2.9.1 Structural Transformation and Human Development

          2.10 Concluding Remarks

Chapter 3: Structural Transformation in South Asia: An Overview

         3.1 Introduction

                3.2.1 South Asian Growth Surprises

                3.2.2 GDP Growth and Its Composition

                3.2.3 Changes in Macro Aggregates

         3.3 Productivity Growth and ST in South Asia: A Panel Data Analysis

               3.3.1 A Dynamic Panel Model

               3.3.2 Methodology and Data

               3.3.3 Empirical Results and Implications

               3.4.1 Reforms for Transition and Growth

        3.5 Poverty and Human Development

        3.6 South Asia: A Region of Growing Inequality

               3.6.1 Income and Wealth Inequalities

               3.6.2 Landlessness and Rising Inequality

               3.6.3 Gender Inequality

               3.6.4 Rising Informality in Employment

         3.7 Inequality in Access to Basic Services

                3.7.1 Access to Water and Sanitation

                3.7.2 Access to Health Services

                3.7.3 Access to Education

                3.7.4 Inequality in Fiscal Regime

         3.8 Sophistication of Exports of South Asian Countries

         3.9 Concluding Remarks

Chapter 4: Structural Transformation: Macro Characteristics in Bangladesh

        4.1 Introduction

        4.2 Economic Structure before Independence

        4.3 Growth and Structural Transformation, 1971-2020

               4.3.1 Growth of GDP and GDP Per Capita

               4.3.2 GDP by Use

               4.3.3 Changes of GDP by Industrial Origin

               4.3.4 Savings and Capital Formation

               4.3.5 Sectoral Composition of GDP

         4.4 Economic Growth and Structural Transformation

                4.4.1 Structural Transformation in the Bangladesh Economy

                4.4.2 Interdependence, Linkages and Leading Sectors

         4.5 Changes in Sectoral Share of Employment

         4.6 Uniqueness of Bangladesh’s Structural Transformation

Chapter 5: Bangladesh’s Rural Transformation

        5.1 Introduction

        5.2 Economic Structure and Agriculture in South Asia

               5.2.1 Nature of Rural Transformation

               5.2.2 Urge for Diversifying Rural Livelihoods

       5.3 Changes in Agriculture in Bangladesh

              5.3.1 Growth in Crop and Horticulture

              5.3.2 Drivers of Crop Sector Growth

              5.3.3 Changes in Resource Base of Agriculture

              5.3.4 Production Organisation: Land Reforms and Property Rights

      5.4 Non-Crop Sector in Bangladesh

            5.4.1 Growth and Development of Fisheries

            5.4.2 Livestock and Poultry

            5.4.3 Women in Non-crop Agriculture

            5.4.4 Forestry Activities  

     5.5 Agribusiness Development for Agricultural Transformation

            5.5.1 Marketing Linkages in Bangladesh Agriculture

            5.5.2 Integration of Market Participants

            5.5.3 Value Chain Management Development

     5.6 Commercialisation of Bangladesh Agriculture

     5.7 Climate Change Mitigation and Adaptation

            5.7.1 Climate Change and Bangladesh Agriculture

            5.7.2 Water Resources and Hydrology

            5.7.3 Long Term Climate Change Vulnerability

            5.7.4 Climate Change Adaptation:  Modifying Agriculture

     5.8 Contract Farming: Implications for Small Farmers

     5.9 The Rural Non-Farm Sector

     5.10 Agricultural Transformation in Bangladesh: Future Directions

     5.11 Agricultural Transformation: Policy Priorities

     5.12 Concluding Remarks

Chapter 6: Industrial Transformation in Bangladesh

     6.1 Introduction

     6.2 Changes in Industry Sector in Bangladesh

            6.2.1 Employment Structure and Dynamics in Industry Sector

            6.2.2 Evolution of Industrial Policy Framework

            6.2.3 Changes in Manufacturing

     6.3 Trade Liberalisation in Bangladesh

     6.4 Sub-sectoral Sources of Manufacturing Growth

            6.4.1 Structure of Manufacturing in Bangladesh

            6.4.2 SMEs and Cluster Development

            6.4.3 Development Potential of Cottage and Micro Enterprises

     6.5 The RMGs Industry in Bangladesh

     6.6 Role of FDIs in Bangladesh

     6.8 Policy Options for Manufacturing Development

     6.9 Concluding Remarks

Chapter 7: Services Sector in Bangladesh: Changes and Prospects

        7.1 Introduction

              7.1.1 Modernising Services Sector in South Asia

        7.2 Bangladesh’s Services Sector

        7.3 Employment Dynamics in Services Sector

        7.4 Software and ITES in Bangladesh

             7.4.2 Key Opportunities

             7.4.3 Logistics and Transportation: Mega Projects

             7.4.5 Way Forward  

       7.5 Digital Financial Services

              7.5.1 Progress of DFS

              7.5 2 Exploiting DFS in Bangladesh

              7.5.3 Digital Inclusion for Women

              7.5.4 Challenges for Digital Inclusion of the Poor

       7.6 Rising Remittances and Their Impact

              7.6.1 Remittances, Household Income and Asset Accumulation 

       7.7 Concluding Remarks

Chapter 8: Inclusive Structural Transformation: Policy Agenda for Bangladesh

       8.1 Introduction

       8.2 Bangladesh’s ST: Need for An Inclusive Agenda

       8.3 Developing Entrepreneurship and Enterprises 

             8.4.1 Creating Productive Employment

             8.4.2 Interaction between Formal and Informal Economy

             8.4.3 Countering Labour Market Imbalances

             8.4.4 4IR and Small Farmer Development

      8.5 Structural Transformation and Shared Prosperity

Chapter 9: Unexpected Challenges: COVID-19 and Cyclone Amphan

9.1 Introduction

9.2 Cyclone Amphan in May 2020

9.4 COVID-19 and Bangladesh

9.5 Socioeconomic Ramifications of COVID-19

      9.5.1 Impact on Economic Growth and Macroeconomy

      9.5.2 Impact on Employment and Labour Market

      9.5.3 Healthcare System and COVID-19 Response

      9.5.4 Gender Dimension of Response

9.6 Dimensions of Vulnerability

9.7 Need for Multi-Sectoral Responses

       9.7.1 Rapid Responses

9.8 Exploiting Potentials of the ‘Gig Economy’

9.9 Concluding Remarks

Identifies that the central challenge for Bangladesh’s services sector is to move from traditional, low value-added activities to modern, high value-added act

Illustrates ways to promote and manage structural transformation processes to address all dimensions of sustainable development--economic, social and environmental

Provides evidence that a transformative export-oriented industrialisation strategy could lead to a broad-based export structure