Bangladesh, a country in South Asia with more than 173 million population, witnessed major political upheaval in the first week of August 2024. A massive student-led protest forced Prime Minister Sheikh Hasina, the 76-year-old world’s longest-serving female leader, to resign and flee the country on Aug. 5, and thousands of people stormed her official residence in Dhaka amid scenes of jubilation. The protests took a violent turn with the overall toll reaching more than 600 since the protests started in mid-July.
An interim government assumed office, and 84-year-old Nobel laureate Muhammad Yunus was appointed as Chief Adviser. The ousting of Sheikh Hasina’s government after 15 years of her rule and the subsequent developments really marked a significant turning point in South Asian geopolitics. The developments in Bangladesh give some important lessons for the countries under neoliberal settings.
In mid-July, a group of young people started agitations demanding the scrapping of a 30% quota system in the country’s government jobs reserved for families of Bangladesh freedom fighters. It may be recalled that West and East Pakistan fought in the Bangladesh Liberation War, leading to the creation of Bangladesh in 1971.
Protesting students claimed that many of them would be denied government jobs after having had to fund their own university studies since the quota system was discriminatory benefiting the families of the ruling Awami League, which fought for freedom. However, the real underlying cause of the student uprising was the increasing unemployment and 18 million young people were already out of work.
For instance, about 400,000 candidates apply for some 2,000-3,000 government jobs every year. This showed the shrinking job opportunities in Bangladesh, with the large-scale mismatch in demand and supply in the job market. The total failure of the export-led economic approach of the Hasina government was clearly evident in the employment front.
Bangladesh’s deposed Prime Minister Sheikh Hasina was considered by her critics as a dominant and brutal dictator. They charged that she jailed, exiled and eliminated most of her political opponents along with numerous human rights abuses. She brought all the state powers in her hand and was bringing the country into autocracy. Many reports about extrajudicial killings, the imprisonment and disappearances of journalists and opposition figures were released by agitators. The protesters called her governing style “cronyism,” since the corruption and wealth appropriation by her associates were all pervading in the country.
Analysts in the mainstream corporate media mainly focused on the “cronyism” and the authoritarianism of Sheikh Hasina while evading the serious consequences of the economic policies pursued by her government. The economic crisis that gripped the country suddenly worsened the living conditions of the poor and middle classes. It naturally caused the unpopularity of the Sheikh Hasina government and found expression in political unrest and massive protests.
Until recently, Bangladesh was portrayed as an Asian economic “miracle” and a great “triumph.” Now it has been proved that such claims were very much illusory. Bangladesh economy was mainly dependent on its exports of garments and it constituted about 80% of its total exports. It was even expected that Bangladesh would be meeting as much as 10% of the world’s garments. However, during the pandemic period, the garment exports were severely affected. This situation did not improve even after the pandemic period, because of enduring stagnation in the world economy. And, due to global recession, Bangladesh was hit by the drastic reduction in the remittances by overseas citizens of Bangladesh, which had been its major source of foreign exchange.
The increasing global fuel prices affected its fuel imports, contributing to severe foreign exchange shortage. This resulted not only in prolonged power cuts, but also caused a rise in the price of energy. The inflation being 9.52% in August, the highest in a decade, and depreciation in the exchange rate vis-à-vis the dollar have all contributed to further downfall of living standards of the people. As food inflation rose 14% in July, the poor were deprived of essential food items. The export-led growth had actually intensified the economic inequality.
In this context, Bangladesh negotiated with the International Monetary Fund (IMF), World Bank (WB), Asian Development Bank (ADB) and other international lenders for loans. Under the erstwhile Sheikh Hasina government, the IMF released $2.3 billion as part of the $4.7 billion loan approved in January 2023. The current caretaker government led by Mr. Yunus is also seeking funding of $5 billion from the WB, ADB, Japan International Cooperation Agency (JICA), and Asian Infrastructure Investment Bank (AIIB).The conditionalities that were imposed for getting loans,the consequent austerity measures undertaken by the government and the burden of debt servicing have all further complicated the situation.
Bangladesh has become one more reminder for the well-proven truth that exports alone cannot be a panacea for all problems related to economic growth. Now, the country is facing manifold crises in economic, political and social spheres. While the international capital through the international financial institutions is muddling the situation, fundamental Islamists are also trying to take advantage of the situation. The democratic and progressive forces in Bangladesh have to rise to the occasion with alternative pro-people policies.
N. Gunasekaran is a political activist and writer based in Chennai, India.
From The Progressive Populist, October 1, 2024
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