Some of the large industries are gaining more capital and dominating the economy and labour market, which is driving rising inequality, said Dr Rushidan Islam Rahman, former research director at the Bangladesh Institute of Development Studies (BIDS).
She said that industrial resources are increasingly concentrated among a few large entrepreneurs, and this needs to be addressed to ensure sustainable growth and inclusive development across all sectors.
The economist made the remarks on Thursday while presenting highlights from her new book titled "Shilpayan O Roptanivittik Poshakshilpa" (Industrialisation and the Export-Oriented RMG Industry), written in Bengali, at a book launching event held at the BIDS auditorium.
Dr Zaidi Sattar, Chairman, Policy Research Institute of Bangladesh (PRI), and Dr Monzur Hossain, member at the General Economics Division (GED) of the Planning Commission, spoke as guests of honour at the event moderated by AK Enamul Haque, director general of the BIDS.
Highlighting the book to be published from "Baatighar Publication", Rushidan Islam said the annual average employment growth rate in Bangladesh dropped sharply to 1.23 per cent during the 2011-2018 period, from 6.24 per cent between 2005-2006 and 2011.
She added that the employment growth rate was 3.85 per cent during the 1999 to 2001-02 period, which then surged to 7.05 per cent between 2001-02 and 2005-06.
The drastic fall has dealt a significant blow to employment landscape, while adequate job opportunities are not being created for the youth, she said, and asked "Without employment, without avenues for labour, how can we even begin to talk about workers' rights?"
Ensuring labour opportunities must come first-only then can the question of workers' rights be meaningfully addressed, she added.
She also noted that the share of large industries in the total number of industries has been declining significantly over time, but their share of total employment has been increasing, indicating that some large industries are expanding in both size and workforce.
To ensure sustainable growth, she stressed diversification of exports and said although national plans emphasise the need for export diversification, they fall short of outlining a clear roadmap to achieve it.
Dr Zaidi Sattar identified the heavy reliance on tariff protection under the import substitution industrial policy as a major barrier to export diversification, noting that high import duties make it more profitable for domestic entrepreneurs to sell their products locally rather than export them.
"Exporters receive incentives worth 5 to 15 per cent of the export value, but products sold in the domestic market receive indirect incentive through protection worth up to 88 per cent. So why would entrepreneurs choose to export?" he asked.
Zaidi Sattar also noted that the economy made limited progress in its first two decades, but growth began to accelerate in the 1990s, driven by export-oriented trade policy.
Employment generation has been faster with a higher wage rate in the export-oriented manufacturing sector compared to import-substituting sectors, he said.
Dr Monzur Hossain said the ready-made garments (RMG) industry, as the country's largest export-oriented sector, is likely to be the most affected after Bangladesh's graduation from LDC status, scheduled for next year.
However, the government has formulated a Smooth Transition Strategy, and three separate high-level committees are working to ensure that the transition is smooth and sustainable.
The government is planning structural reforms to keep the RMG sector competitive, including pursuing Free Trade Agreements (FTAs).
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