Lessons for India to Learn from Bangladesh Economy

Prime Minister Narendra Modi and Prime Minister of Bangladesh Sheikh Hasina. — AFP file photo

Noor Fatima | Caravan Daily

BANGLADESH’S Prime Minister Sheikh Hasina looked forward to a golden period of India-Bangladesh relations in her recent visit to India. Today the bilateral relations between the two neighbouring countries have matured greatly and are at their historic best.

As a socio-economic development professional, one is bound to be intrigued about the significance of the ties. Are we not going to see things beyond these relations? Should we ignore the fact that Bangladesh is set to step out of the list of the least developing countries and experiencing high and consistently rising economic growth rate of 8.1% (GDP) in fiscal the year 2018-2019, while at the same time India is battling the economic slowdown with companies cutting jobs and people getting unemployed.

Shockingly this is happening when Indian government has initiated several flagship job creation programmes like Mudra loans, Skill Development and Make in India etc. Keeping in mind that there is slowdown in nearly 90% of the world, it’s surprising how come a country with the slowest economic cycle is successful in improving her socio-economic status. India, on the other hand, despite being the world’s second fastest growing economy for quite a long time failed in maintaining her socio-economic status.

Unlike India, Bangladesh has a booming industrial sector majorly textile (35% of the GDP) which encourages self-employment whereas in India, service sector contributes more while industries account for lesser ’ contribution to growth. Bangladesh is developing and urbanising fast despite the fact that the World Bank has declared the country a lower-middle income economy in 2015 with a growth rate of 6.6%.

The GDP Growth Rate over 4 years and Sector wise GDP growth Contributors *Source ADB

Over the years, Bangladesh has made some remarkable gains in terms of human development indicators. It’s high time India learnt from its neighbour’s new Human Capital Index. It is significant in view of the fact that for the poorest people it is the only capital they own. India should learn how to spend its capital effectively for improving outcomes in health and education, productivity and economic growth.

According to World Bank’s Human Development Indicators 2019, Bangladesh is now ahead in:




life expectancy at birth



Infant mortality rate (per thousand live births)



It is in maternal mortality rate (per thousand) that India does significantly better at 170 compared to 210 for Bangladesh.


Bangladesh’s development in all these aspects is a clear lesson of how a country with strong track record of poverty can be successful in poverty reduction just with the help of right policies and actions. Bangladesh’s achievement of gender parity in school enrollment works as the icing on the cake, though the indicators for education are mixed for both India and Bangladesh at 6.4 and 5.8 respectively.

Not to forget that both, our Father of the Nation Mahatma Gandhi and Bangabandhu Sheikh Mujibur Rahman dreamt of an exploitation free and just society. Bangladesh is also marching ahead in terms of women’s literacy, which itself speaks about the changes in the social structure and based on which, it is  expected to achieve 8.0% growth in economy in 2019 and 2020, India on the other hand, is expected to grow by 7% in 2019 and 7.2% in 2020. (By an estimate of the Asian Development Bank).

What led to the evolution?

Since its inception, Bangladesh had the backing of the world’s one of the largest NGO, BRAC. Working towards nation building, BRAC is termed as Bangladesh’s second government with power and accountability. It has helped with innovations and initiatives that impact normal citizens in their socio-economic development. One of the major reasons for Bangladesh’s booming industrial sector is BRAC’s micro finance loan which funds small enterprises. BRAC as an NGO has a different approach to development and is successfully working hand in hand with the government in Bangladesh.

Even when the NGOs work in government partnership they fail tremendously on the scale of human development in India. Instead what we see at the start of each financial year are a whole lot of new programmes and schemes that either run counterproductive to the existing schemes, are insufficiently funded or are just a window dressing to satisfy the constitutional duty of being a welfare state.

Apparently, we can see that India is moving in reverse direction despite the support of 3.4 million NGOs for a population of 1.37 billion i.e., one for every 600 people. Here we are with hundreds of schemes for the socio- economic welfare of the citizens, yet we are unable to achieve significant improvement. We are majorly lacking in understanding the needs of our target audience and this is what we need to learn from our neighborhood nation Bangladesh.


Noor Fatima is a Development Communication Professional and a contributing writer.



Please enter your comment!
Please enter your name here