As one of the most densely populated countries with a population density of 1084 people per square kilometer, Bangladesh, despite many of its problems, may feel complacent that about 66 per cent of its population is between 15 and 64 of age. As per the latest population census, 33 per cent of our population belongs to the age group below 14 years, while 18.8 per cent to the age group of 15-24 years and 37.6 per cent to the age group 25-54 years.
Demographic Dividend (DD), as defined by the United Nations Population Fund (UNFPA) means, "the economic growth potential that can result from shifts in a population's age structure, mainly when the share of the working-age population (15 to 64) is larger than the non-working-age share of the population (14 and younger, and 65 and older)." In other words, it is "a boost in economic productivity that occurs when there are growing numbers of people in the workforce relative to the number of dependents. A country with both increasing numbers of young people and declining fertility has the potential to reap a demographic dividend. According to this, Bangladesh has already entered into the period of DD as 66 per cent of its population is in the workforce bracket and after 15 years it will be at its peak advantage. But the question is -- will Bangladesh be able to get full advantage of the DD?
Bangladesh has been successful since the past few decades in controlling its population growth, which is currently 1.36 per cent. According to the world population prospect, the size of the population of Bangladesh will be approximately 200 million and 300 million in the years 2025 and 2150 respectively. A recent report of UNDP titled "Shaping the Future: How Changing Demographics can power Human Development" states that the current workforce is 10.56 million and it will increase to 12.98 million in the next 15 years comprising 70 per cent of its total population.
A country can take advantage of DD only when a) its maximum number of people is in the workforce, which is well diversified, b) have skill compatible with the demands of the market, c) dependency ratio is the lowest resulting in increased savings, d) income is well distributed reducing income inequality, and e) human capital is increased resulting from training of human resources required to meet job specifications of the present and emerging times.
Seventy-two per cent of our people are mainly farmers generating their income directly or indirectly from farming in rural areas. We have 8.24 million hectares of cultivable land equivalent to 58.22 per cent of the total land area but it is gradually decreasing with increasing urbanisation and industrial expansion. The area of cultivable land has been reduced by 7.0 per cent from that of 1974. The arable land has been decreasing at the rate of 0.74 per cent every year. On the other hand, only 65 per cent of the total land area has access to irrigation and 77 per cent of irrigation is done by using groundwater which has resulted in drastically lowering down the level of groundwater. Bangladesh is likely to face water shortage that will lead to poor agricultural productivity and leave serious negative impact on human lives.
Too often the farmer community is not able to recover their cost of production of crops. Loans though Banking Financial Institutions (BFIs) and Non-Banking Financial Institutions (NBFIs) do not have any mechanism to extend credit facilities to marginal farmers. This grim picture has led to a significant transformation in rural labour market. Now the youths (educated or not) of these farming families are not interested in cultivation. They are desperately trying to shift to other jobs creating shortage of farm labour.
Bangladesh, however, has an absolute advantage in agriculture so it needs to exploit it properly. But the way we are behaving with our marginal farmers is never going to address this issue.
Another major challenge to cash in on the DD is the threat of global warming since Bangladesh is the most vulnerable country to climate change. According to climate change synthesis report of Intergovernmental Panel on Climate Change (IPCC), annual anthropogenic Greenhouse Gas (GHG) emissions by gases in 1970-2000 were +1.3 per cent and in 2000-2010 +2.2 per cent. The current emissions will continue to raise the temperature of the world if emissions are not cut down. One estimate shows that by 2030, 2050 and 2100 the average temperature of Bangladesh will rise by 1?C, 1.4 ?C, and 2.4?C respectively. As a result, the sea level may rise by 14 to 88 centimeters and one-fifth to one-fourth portion of the land may go under water and 30.5 million people may be the worst sufferers. Another estimate shows that rice and wheat production will decrease by 8.0 per cent and 32 per cent respectively by 2050 due to global warming. If this global warming really happens, Bangladesh will face a big trouble to ensure its food security and meet Sustainable Development Goals (SDGs).
Another challenge to Bangladesh to get full advantage of DD is to gradually build an industrially developed nation through proper utilisation of the resources available so that it can offer employment opportunities to the burgeoning population.
To see maximum people in diversified workforce within and outside the country is another challenge for Bangladesh. Bangladesh needs to make big strides in the education sector at all stages, especially to curb dropouts. If the government fails to retain the students up to a reasonably high level, it will never be able to ensure a good supply of workforce equipped with the right set of skills. There are eight million people working outside the country but a small percentage of them have the skills to meet their well-paid job specifications. Experts have already urged the government to equip aspiring migrant workers with the right sets of skills and languages before they depart for jobs so that they can earn more and avoid exploitation. As many of the host countries are also experiencing demographic shifts, the structure of their labour demand is expected to undergo considerable changes, said Prof. Mustafizur Brahman, executive director of Centre for Policy Dialogue (CPD). "This has important implications for the development of needed skills and catering to the emerging demand for financial inclusion." For example, skilled Filipino migrant workers send home four times more in remittance compared to Bangladeshi workers. Sri Lankan workers earn up to 70 per cent more than their Bangladeshi counterparts because of their skills and fluency in English.
Bangladesh needs to go for accelerating vocational education at SSC and HSC levels and collaborating with the host countries so that they can be trained according to the required job specifications. A wide range of skills training programme can help Bangladesh gain demographic dividends with more remittances from the Western and industrialised Asian countries. The ever-shrinking young and productive workforce in Europe, Japan and South Korea has given huge opportunities to Bangladeshi workers. Besides, the government needs to take proper initiative to explore new labour markets and revive the lost markets by overcoming the prevailing barriers.
According to Doing Business Report 2016 of the World Bank, the position of Bangladesh is 174 among the 189 countries. According to the USA-based research institute Global Entrepreneurship Development Institute (GEDI), Bangladesh ranks 125th out of 132 countries, five places up from last year. In the Human Development Index, Bangladesh has been placed at the 142nd position with 0.57 point among 188 countries. Bangladesh slipped one notch to rank as the 13th most corrupt country in the world in 2015, according to the global corruption index of Transparency International. So, these reports show that Bangladesh still needs to go a long way with a special focus to develop a congenial business environment, promote entrepreneurship development programmes, turn human resources into human capital, curb corruption, develop diversified work force, develop workplace diversity, improve organisational capacity and productivity, develop the IT sector, develop energy and infrastructure, and ensure political stability and good governance.
Despite these challenges, Goldman Sachs has included Bangladesh as one of the Next Eleven countries, which have potential for continuing growth in the coming years. JP Morgan has identified Bangladesh among the Frontier Five countries having the potential of achieving phenomenal growth. So, it is high time for Bangladesh to critically assess the challenges and come out of its shell and exert all-out efforts to take full advantage of the demographic dividend.
The writer is Senior Officer, South Bangla Agriculture and Commerce Bank Limited (SBAC Bank Ltd).
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