Bangladesh has come a long way in 50 years since independence

Bangladesh’s GDP per capita now closely rivals India’s and significantly exceeds that of Pakistan.

It feels strange to have known a country since its birth. For much of 1971, Bangladesh (then East Pakistan) was engaged in a war for independence. With US president Richard Nixon standing firmly behind Pakistan as president Yahya Khan’s army tried to crush the independence movement by resorting to rape and genocide, millions of Bangladeshi refugees poured into India. I was then an undergraduate in Delhi and joined a team of students to work in the sprawling refugee camps that had sprung up in the Indian states of West Bengal and Odisha.

Full-fledged aerial war with Pakistan broke out on December 2. I vividly remember catching the night train in Kolkata to return to college during a curfew, under orders to keep all the lights off in the compartment. This was the high point of Indian prime minister Indira Gandhi’s career. She had opened India’s doors to the refugees and intervened militarily to support Bangladesh, refusing to cave in to US pressure, which included sending the Seventh Fleet into the Bay of Bengal. Khan’s army surrendered to an Indian-Bangladeshi allied force on December 16, 1971. Bangladesh had already declared independence on March 26, but it was effectively born that day in December.

At independence, Bangladesh was one of South Asia’s poorest countries — poorer than India, and much poorer than Pakistan. Described by then-US National Security Adviser Henry Kissinger as a “basket case”, it floundered for several years, a vast archipelago of poverty and deprivation. Things got worse in 1974, when the Nixon administration suddenly cut off food aid to Bangladesh while the country was in the midst of a famine, on the grounds that it was earning some money by exporting jute bags to Cuba.

Today, as Bangladesh celebrates a half-century of independence, the country has become a case study in economic development that few would have predicted. When its GDP growth rate surpassed Pakistan’s in 2006, many dismissed it as a one-off fluke. But Bangladesh has outpaced Pakistan every year since then, and — astonishingly — is now one of the world’s fastest-growing economies. Bangladesh’s GDP per capita now closely rivals India’s and significantly exceeds that of Pakistan. Average life expectancy, at 74, is higher than in India (70) and Pakistan (68). The country is a leading global exporter of ready-made garments, and other sectors are taking off, too. Bangladesh’s pharmaceutical industry, for example, is thriving. With 300 companies (several of which conduct research) the country now meets 97 per cent of domestic demand, and is beginning to export globally.

True, Bangladesh still has much poverty and hardship, rising inequality, and an uncertain future trajectory. Climate change and rising sea levels continue to pose significant dangers, and political instability could yet re-emerge and disrupt economic progress.

Nevertheless, Bangladesh’s remarkable economic transformation — the World Bank now classifies it as a lower-middle-income economy — deserves praise and can offer important lessons for today’s low-income countries.

Kaushik Basu, a former chief economist of the World Bank and chief economic adviser to the Government of India, is Professor of Economics at Cornell University and Nonresident Senior Fellow at the Brookings Institution.