DIVERSIFICATION: Hosts of journalists, policymakers and scholars have long advocated for ‘diversification’. Many interpret ‘diversification’ through commercial eyes, as alternatives to RMG exports. Some of them want to reinvigorate other primary products (raw materials), like jute production or expanded fish hauls, others to boost secondary products (manufactured), like motorcycles and automobiles, and yet others to scrape the surface of such tertiary-level (service-based) software exports from the country’s dozen-odd hi-tech parks.
Bangladesh needs them, but each is too project-specific or sector-specific to explain the comprehensive and more multifaceted ‘national economy’. Any ‘national ‘economy must harmonize with social, political and technological dynamics, such as Main Street needs, sectoral shifts, mobilizing unutilized resources, balancing material with non-material outcomes, preserving the environment; and promoting education with employment connections. Visioning beyond the economic ‘tree’, one must scope the shape, size, and nature of the ‘forest’, where consumer preferences, habitats, and brewing tastes lie.
Responses to street-side wage protests have typically (and all too infrequently) been to raise the pay, albeit marginally. Such a measure is preventive. It is akin to stopping the flood, not probing the causes of flood. That requires a more curative approach, capable of raising worker satisfaction and going beyond immediate wage increments (‘tree’) to sternly adopt and firmly implement phased wage increment, health and pension, as well as educational/training provisions in recruitment contracts so the worker, his/her family, and particularly children, are covered. This is the ‘forest’. An enthusiastic workforce is an asset for the ‘national economy, and if that country is ‘climbing’ any ‘development’ ladder, as Bangladesh is, it is of vital interest.
So too does politics. Business corporations inevitably influence policies in preferred directions. Their scions hold/influence upper governmental positions, even serve as parliamentarians. It is a globally common practice: two decades of the U.S. ‘Gilded Age’ (1870s and 1870s) were anchored by rambunctious industrial growth, as too the ‘Roaring Twenties’ following World War I. After almost half a century, Bangladesh’s RMG dominance has to yield to prevent free-market growth from stunting and street protests from proliferating. RMG worker-pay, for example, does not tally with the incomes expected in a ‘developing’ country, as Bangladesh hopes to become from November 2026, snapping ‘diversification’ possibilities.
By capturing half-century of RMG performances, Table 1 identifies what non-economic windows to open. One is ‘development’. Bangladesh is already climbing the U.N. Economic and Social Commission’s (ECOSOC’s) ‘development’ ladder. In November 2021 it was promised ‘graduation’ from a ‘less developed’ low-wage RMG country into a ‘developing’ country. A three-year review -adjustment window is routinely given, but for Bangladesh raised to five. If Bangladesh can cross that threshold, a ‘developed’ country with a 2041 target would follow. It needs far more than economic cookies (RMG domination), to make it. Table 2 depicts.
Other interpretations of ‘diversification’ have emphasized geographical distribution. For instance, Sajeev Sanjal informed us how the emergence of India’s Southern states (highlighted by Bangalore/Bengaluru) killed two proverbial ‘birds’ with one ‘stone’ from the early 1990s, when the country embraced neo-liberalism. To expand their 8.7% share of the Indian GDP before the 1990s, they had to cut into the GDP shares of Uttar Pradesh (Delhi and others in the north), Maharashtra/Gujarat (Bombay/Mumbai), and West Bengal (Calcutta/Kolkata), of 14.4%, 12.5%, 12.4%, respectively. How did they do it? By pioneering the shift from ‘manufacture’ towards ‘services’, that is, from hardware assembly-line-filled industries towards software-based Silicon Valley, the Southern share climbed rapidly to boast 30 per cent of India’s GDP today. India is similarly nurturing its northeastern Seven-Sister States today.
Why cannot similar bold changes dot Bangladesh’s industrial landscape, of RMG factories from Dhaka distributed to other locations, or from RMG industry to other industries?
Bangladesh’s pathway partly resembles its own colonial master’s: Great Britain. For few other countries have the RMG industry played so overwhelming a start-up role as it did Britain in the late 18th and 19th centuries and Bangladesh in the 21st. Yet, Britain pioneered not only the First Industrial Revolution (FiIR) but also the Second Industrial Revolution (SIR) (with Germany and the United States) in which steel replaced RMG dominance from the 19th Century (unlike other pioneers, Germany was not a RMG standout). Unsurprisingly, Britain easily flowed into the computer-based Third Industrial Revolution (TIR) after World War II from steel, begun largely by scientists fleeing Nazi rule to the United States during the 1940s. In fact, the room-sized ENIAC (Electronic Numerical Integrator and Computer) 1943-46 contraption that marked its arrival (in the Moore School of Electrical Engineering in the University of Pennsylvania), initiated the landmark move from low-wage manual work (hardware) to sophisticated high-skilled intellectual inputs (software). Britain was again structurally prepared to slide into both the Third Industrial Revolution and the Fourth Industrial Revolution (FoIR),the latter built upon artificial intelligence or AI. It had nurtured intellectual platforms. While Britain could ‘diversify’, Bangladesh opted out.
Whereas hardware drove the first two of the four industrial revolutions (climbing from manual low-wage RMG to low-wage, low-tech manual steel work), software is vital for the last two IR phases. Since intellectual inputs (from computers to artificial intelligence, such as robots and internet-of-things, among others) replaced manual(Google software replacing library ‘hardware’, such as published books, and so forth), Bangladesh may miss the meaningful industrial boat. Its RMG addiction plagues its future and directly retards the upgrade every parent seeks in his/her child’s growth: its average citizens today are more skilled than to sink into taking low-wage jobs. Though pockets of extreme poverty remain, and poised to grow, Bangladesh needs to nip the buds of future strikes and disruptions immediately. Understanding the ‘development’ trajectory helps, but a concurrent example could help inspire that track-change.
Three centuries of industrialization and two of ‘diversification’ were enough for Walt Whitman Rostow to formulate ‘stages’ from these changes in his monumental 1960 work. He outlined five such stages. The first is a ‘traditional’ society (mostly agriculture). It yields to an industrial ‘pre-take-off’ (RMG) before ‘taking off’ (steel) in the third. These three manual stages yield to intellectual -driven dynamics, dubbed ‘maturity’ (computer) and ‘high mass consumption’ (robots), representing the fourth and fifth stages, respectively.
ECOSOC’s ‘developed’ country begins with these last two stages. Accounting for 80+% of export income, Bangladesh’s RMG domination cannot be the only horse to ride upon to get there by 2041. It must look outside ECOSOC’s GDP-per-capita criterion to those non-economic ECOSOC criteria demanding a ‘human assets index’ (HAI), and environmental vulnerabilities index (EVI). Table 3 shows the manual-intellectual transformation through Rostow’s lenses, and helps glean a fond farewell to its RMG era.
Interestingly, and most importantly, Bangladesh has unwittingly experienced all five stages. Except for the RMG-driven First Industrial Revolution and ‘pre-takeoff’ stage, it has not extracted much mileage from any other. Forward-linkages automatically spun out in the RMG industry (through automation), but frankly, low-wage labour reforms owe far more to microfinance breakthroughs at the lowest-income level than to RMG growth. This different dynamic, and another handsome pillar of the country’s growth, did most of the heavy lifting of social advancement, particularly through women empowerment (which the RMG industry blatantly undercuts). By accenting ‘bottom-up’ benefits, not ‘top-down’ profits, microfinance sets an example for RMG enterprises to follow to contribute to Bangladesh’s domestic social infrastructure buildups. Too few engage in that today. Imposing more pungent economic taxes (or removing duty-free imports), will, no doubt, lower corporate profits, yet boost net national and social benefits noticeably. While per-capita income has grown, so too inequalities. See Table 4.
Another example illustrates. Bangladesh’s RMG industry needs over 750,000 bales of cotton annually, but the country only produces about 150,000 bales (each bale is about 400 tons), meaning output is 60 million tons). Importing inputs is inefficient (subsidies spiral, boosting public costs), sticky (once started, they hardly disappear), and unpredictable (the pandemic and global wars have broken supply linkages and raised energy prices enormously).
Bangladesh similarly does not have enough coal or iron-ore to fuel a steel industry, as across the United States or West Europe. Yet the country became self-sufficient in steel. How? Its large pool of dirt-cheap labour shifted global ship-dismantling leadership towards Bangladesh, just as they had done to create RMG leadership. Destitute children filling the labour pool engage in horrendous, environment-corroding, and dangerous work to earn an income. Again, profit making obscures the human condition, violating both domestic and international labour laws. ‘Development’ without a human face is precisely what today’s reform movement seeks to correct, but its attention must now shift from middle-class jobs, which is what drove the students originally, to those at the lower social spectra, if only to stem the growing impoverished citizen proportion.
Nonetheless, with ample steel from ship-breaking scraps, Bangladesh has just begun ramping up its automobile industry. Japan and Malaysia have agreed to assemble Mitsubishi and Perodua brands in Chattogram, thrusting Bangladesh into the ‘takeoff’ third Rostow phase (bar the human qualitative constraint just alluded to). Shifting from manual’ to intellectual input, Bangladesh could climb higher on the global call-operator list. As another respectable job-window for women opens, Bangladeshi girls fall short: they are not English -proficient enough. This was the key missing variable we learned while interviewing at the Jashore Software Technology Park(under the Bangladesh Hi-Tech Park Authority).With better English proficiency, India leads the global call-operator list with its 100,000+ tech-savvy graduates; and with many girls, the way they break the glass ceiling with English should empower Bangladeshi girls too.
Entering the Top-30 largest economies is possible (Bangladesh is there in purchasing power capacity), but structurally impeded. How would ‘youthful’ desires change that? They must return to personal challenges before reconfiguring the country’s profile. Getting off the streets is a start, then shifting their reform-minded instincts into picking up the latest skills or knowledge may bring them a more handsome personal pay, thereby lifting national dividends. London’s Economist noted only in its August 29 issue this year how today’s more skillful youth have not been as “mature” as their parents were. Will their skills suit the vigorously emergent multitasking job-market? Are tech-savvy jobs awaiting them? Relegating RMG production and consciously promoting ‘take-off’, ‘maturity’, and ‘high-mass consumption’ sector-jobs must become a national vital interest now, so today’s youth can find meaningful jobs, get married, have children, and train their children to end up with higher-hanging jobs than lowly-placed RMG-type jobs. Otherwise, they would have to tiptoe their parental footsteps into ‘quota’-like protests themselves.
EDUCATION: One giant leap for Bangladesh accompanied its return to democracy from the 1990s is permitting private universities. These filled an embarrassing vacuum, and have since flourished far more in numbers than public universities (113 versus 55 today, with 3 ‘international’ universities). At least a million students benefit from them annually. Yet profit making has crept into private universities. Since the coronavirus pandemic threatened student admission, sustaining profits necessitated lowering standards, but skill-building purposes also nosedived.
Two changes may help. One positive aspect of the coronavirus pandemic was the advent of online education in Bangladesh. This is the future education wave or platform, already evident abroad. Bangladesh needs to hop on to ease its transition into the ‘third’ and ‘fourth’ industrial revolutions that necessitate intellectual inputs. Today’s multitasking jobs necessitate fleet-footed multi-disciplinary training. Traditional disciplines (‘Majors’) look worn-out. Even the bureaucracies managing education, like the University Grants Commission, may be getting a tad slower against rampant technology-driven curricular changes. Whereas Bangladesh needs multidisciplinary faculty, not enough prevails to fit the bill. Without multidisciplinary training or a life-long job-contract to better scope rapidly evolving frontiers of knowledge, innovative capacities disappears. Ignoring how these curricula changes reshape education abroad in the way Bangladesh avoided Britain’s RMG ‘graduation’ initiatives is a lesson still worth learning. The fabulous future new technologies promise awaits only the fleet-footed before obsolescence knocks equally rapidly.
A second handicap is UGC relevance in curriculum setting. It did a spectacular job galvanizing the country and synchronizing public universities under a more uniform rubric. Yet, since private universities have loosened that coordinated capacity and adjusting to fast-progressing online technologies is proving arduous, some form of decentralization is overdue. Most of all, because of the nature and space of unfolding changes, perhaps online rather than ‘hard copy’ exchanges and top-level faculty recruitment rather than reliance on bureaucrats, could better spearhead needed academic changes. Yet, Bangladesh does not have enough of them to become competitive in quick-fire education. Since today’s government decision becomes obsolete by the time a UGC approval arrives to implement it, it becomes redundant, uneven, and unnecessary. As job-markets seek multitasking talents, multitasking management can better supply their needs.
ENVIRONMENT- A ‘NAKED’ DEVELOPED COUNTRY: Just as our independence depicted Rabindranath Tagore’s ‘Sonar Bangla’ in full glow, our industrialisation emasculated the ‘Sonar’ portion. Townships swelled with impoverished, landless rural migrants, on the one hand. On the other, slums, riverbank occupation, and untrained co-relationship between production and satiation also expanded as uncontrolled factories and entrepreneurs unschooled in the relationship between economic profits and environmental sustainability chewed away the legendary beauty of our environment. Stacking factories in congested cities, dumping wastes into rivers, and allowing carbon to pollute the atmosphere do not characterize a ‘high mass consumption’ society.
Dumping RMG and leather industrial wastes, for instance, has destroyed our rivers. In Dhaka, where citizens could go boating or swimming in the 1970s, as in Dhanmandi Lake, defecation and intoxication repulse visitors today. Since its rivers flow into the Bay of Bengal, whose tidal movements carry them into the ocean (even as far as the Pacific Garbage Patch), innocent factory mishaps (or innocuous farmers sprinkling chemical-tainted fertilizers that ultimately seep into waterways) stir global consequences. Bangladesh is not the only culprit, but fewer countries rank below Bangladesh in consciously correcting this malaise. If our stomach is already churning with distaste, consuming intoxicated fish must be the last straw. Our famous staple food item now corrodes heart, kidney, liver, and prostrate body organs. If that helps explain why so many Bangladeshis travel to India, Malaysia, Singapore, or Thailand, then we must responsibly know medical treatment trips become unnecessary and exorbitantly costly. Against these impediments, can Bangladesh qualify to enter a ‘mature’ economic society or a ‘high mass consumption’ entry with dignity for its more sophisticated citizens?
One indicator of our plight is the SDG campaign from 2015 by the United Nations. With 17 ‘goals’ and 169 ‘targets’ to fulfill, Bangladesh should push the ‘panic’ button. Some of these reflect the very industrial problems dealt with here: SDG10, SDG14, SDG15, and SDG16, and so forth. Table 5 lists and describes their statuses presently. Overall, by the end of 2023, Bangladesh’s performances raised eyebrows. Ranked 101st out of 165 countries, Bangladesh posted an average score of 65.9 (out of 100). About as many of those ‘goals’ did well as worsened (30.9 versus 27.9, respectively), with roughly 41.2% left fiddling in the middle. Concerns climbed when the 2024 score slipped to 64.3 (out of 100), and ranking to 107th out of 167, with 29.7% improving (a slip from the year before), 31.1% worsening (slipping again), and 39.2 % struggling in between (yet another slip). Bangladesh will not be ready to clean itself sufficiently by 2030 to qualify on the SDGs front. Nor will it be anything but a naked ‘developed’ country in 2041, with too much money in too few hands and too few domestic items to buy or too few sites for tourists to see.
REFORMS AS LAST RESORT: Only the masterminds of the longest July in human history (of ‘36 days’) can pull us out of this plight. They should not make the same mistake as their parents’ generation unwittingly did: bequeath a poisonous ‘development’ climate to their children. If they do not, they could see some kind of a ‘forest’ that a large proportion of today’s businesspersons and policymakers do not even bother to scope. Even more: if they can properly trim every ‘tree’ falling in their pathway, they may have begun to pluck this country’s structures out of its crippled quagmire, thus making the ‘forest’ more visible and accessible. These can restore the ‘Sonar’ back into Bangladesh conversations, folklore, landscapes, literatures, neighbourhoods, poetries, and vocabulary, tame the engines of growth, that is, industries, push the country’s industrialisation and ‘development’ into ‘maturity’ through sustainable reforms, and steady the nascent ‘reform movement’.
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Dr Imtiaz Hussain is Professor, Department of Global Studies & Governance (GSG), Independent University, Bangladesh (IUB)
imtiaz.hussain@iub.edu.bd
Navigating ‘diversification’ challenges:
Artifice of correlating ‘tree’ & ‘forest’
Imtiaz A Hussain | Published: November 08, 2024 21:42:36 | Updated: November 09, 2024 23:43:44
Artifice of correlating ‘tree’ & ‘forest’
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