Remittance money: Flies in, flies out

Shamsul Huq Zahid | Published: April 22, 2015 00:00:00 | Updated: November 30, 2024 06:01:00

Bangladesh, which is among the world's top 10 remittance earning countries, received around $15 billion from its expatriate workers in 2014.
During the same period, foreigners working in different fields of Bangladesh sent back to their respective homes around $6.0 billion, meaning a fund equivalent to 40 per cent of the inward remittance income had flown out of the country.
An FE report published last Tuesday quoted the president of the Dhaka Chamber of Commerce and Industry (DCCI), Mr. Hossain Khaled, to mention the outward remittance figure, an estimated one.
The private sector in particular has no other option but to employ foreigners at key (or even mid-level) management positions and other technical jobs since there is an acute scarcity of relevant skilled human resources locally.
A good number of foreign workers are obviously from neighbouring India, which received its fifth largest (more than $4.0 billion) remittance income
from Bangladesh in 2012. The UAE, USA, KSA and UK are four other top providers of remittance income to India.
India with a remittance earning of $70 billion was at the top of the 10 remittance-earning countries in 2014, followed by China (more than $64 billion).
However, both inflow and outflow of remittance are two natural phenomena. For instance, France, a developed country where millions of migrant workers work and remit a sizeable amount of money back home every year also had the world's fifth largest remittance income -- nearly $25 billion, in 2014.
But the issue here is affordability. What France or Germany can afford, in terms of outflow of remittance, Bangladesh cannot think of allowing even a fraction of it.
The importance of remittance income in the Bangladesh economy does not need any elaboration. So, remittance outflow, that too, equivalent to 40 per cent of the inflow of the same, does not bode well for the economy.
The majority of the foreign workers are management professionals and technical hands working in the local industries. A good number of IT professionals are also working in Bangladesh, apart from those working at senior (or even mid-level) positions in the readymade garments sector, the leading one of the country's economy. Even some otherwise reputed advertisement firms, media-or event-related consultancy houses etc., are reported to bank on such foreign nationals, particularly from India, with or without prior clearance by the authorities concerned in Bangladesh.
However, it is alleged that many of the foreign workers, particularly those coming from neighbouring India, are staying illegally in Bangladesh and working without valid work permit. The relevant authorities, apparently, are least concerned about the issue since they are required to remain busy with many other 'important' works.
Under the circumstances, one has valid reasons to believe that the central bank also does not have any accurate data on the outward remittance. Illegal workers do not use legal channels to remit their incomes in Bangladesh. They take the services of the hundi operators. If the illegal workers are from India, sending money back home remains a trouble-free process. Actually, it takes a few minutes.
Over the years, outward remittance through both legal and illegal ways has gone up in view of the employment of a greater number of top management professionals, technical hands and IT professionals. But was it that difficult to eliminate the country's dependence on outsiders gradually?
What are the steps that our government and the private sector have taken so far to fill up the vacuum of professional managers, technical workforce and IT experts?
Expecting anything from the both the parties in this connection would be too much, particularly in a country where research and development (R&D) are virtually two unknown words. The government behaves miserly when it comes to spending on R&D. And the private sector remains a very poor performer in this area.
What the country needs to do urgently is an assessment of manpower needs in various sectors of the economy and design an appropriate human resource development plan. Churning out generalists in thousands every year by educational institutions -- many of which care the least about the quality of education being imparted to their students -- would create more problems for the government than solving those.
The finance minister has already said that the human resource or skill development would get the topmost priority in the next budget the size of which is likely to be worth Tk. 3.0 trillion. The budget document, it is hoped, would show the way how he wants to reach the goal.
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