The recently released Household Income and Expenditure Survey (HIES) 2016 and by the Bangladesh Bureau of Statistics (BBS) portray positive outcome as far as poverty in Bangladesh is concerned. The lower poverty line head count in 2016 records incidence of poverty at about 13 per cent while 24 per cent for the upper poverty line. This can be pitted against about 18 and 32 per cent respectively of 2010 and about 34 and 49 per cent respectively in 2000. As is in the past, rural poverty exceeds urban poverty.
The rise of the incidence of poverty in Rangpur from about 28 per cent in 2010 to about 31 per cent in 2016 raises a big question as to how that could happen when we are celebrating the exit of 'monga' from that area.
However, poverty continues to be the perennial problem in Bangladesh. It is thus no wonder that the issue of poverty overtakes everything in the documents of the government, the private sector and the donors. It is very unfortunate that even more than four decades after independence, Bangladesh remains as one of the poorest countries in the world. Researches on poverty under different shades and connotations are as widespread in this country as the level of poverty itself. There are various estimates of poverty levels, and each of them could be criticised from different angles. It is normal, given different data set and assumptions used by the researchers.
Poverty is basically a multi-dimensional concept that does not arise only from low income level. It is not a state of deprivation either; it is a state of vulnerability. The starkest manifestation of poverty is in the incidence of actual exposure to violence of one category or another. Poverty shows up its ugliest face in terms of hunger and malnourishment. Inadequate dietary intake or metabolic disorder triggers off a chain of reactions which cause depletion in body tissues and fluids leading to the loss of body weight and impairment of physical growth, especially among children. This may pass on to the next generation to put person(s) in poverty trap. Poverty also involves gender dimensions. Thus, only to concentrate on family poverty without paying attention to gender can be misleading in terms of both causation and consequences. Poverty may also be looked at from the angle of 'social exclusion' or 'voices' where a particular segment of the population is barred by laws or customs to participate in economic activities or social functions. We can also mention about absolute and relative poverty. For example, poverty level of an individual may improve over time but the difference with his neighbour might equally increase at the same time. And finally, Human Poverty embraces health and education in addition to per capita income that led to the emergence of the concept called 'Human Development Index (HDI).
Bangladesh can duly take a pride in its attempts at reducing poverty. There had been a uniform and steady decline in poverty rates from 2000 to 2010 with an average decline of 1.74 percentage point per year. In 2000, about half of the population was poor that dropped to about one-thirds by 2010. The Planning Commission estimates show that about one-fourth of the population was poor in 2015 and hopefully it would climb down to one-fifth by the end of the Seventh Plan in 2020. Pitted against internal and external shocks, the performance is quite impressive. It may be mentioned that the incidence of extreme poverty fell faster during the same comparable periods - from one-third in 2000 to about one-fifth in 2010, and from about 13 per cent in 2015 it is projected to go further down to about 9.0 per cent in 2020. But significant gap exists between urban and rural poverty as evidenced by the fact that in 2010, 35 per cent of the rural population was poor compared to 21 per cent in urban areas. For extreme poor, the rate is 21 and 8.0 per cent respectively. The historical regional disparity between the eastern region of the country (Dhaka, Chittagong, and Sylhet divisions) and the western region (Khulna, Barisal and Rajshahi) - seems to have narrowed down over time. Available evidences show that at national level, poverty depth was nearly halved over 2000-2010 period, and Bangladesh 2015 poverty headcount is below the Millennium Development Goal (MDG) target of about 29 per cent for 2015.
Based on solid progress in poverty reduction so far, the Seventh Five Year Plan (FY2016-2020) envisages to cut extreme poverty sharply to only about 9.0 per cent by 2020.
What could have contributed to such dramatic decline in extreme poor households? Obviously, accelerated economic growth over the last few years has been a powerful tool. If growth becomes more transformative in both rural and urban areas, it would have more perceptible impact on extreme poverty level. One might question the influence of economic growth on the extreme poor as they are supposed to be outside the process of growth, but nevertheless, the group benefits from the spill-over effects. More importantly, the rise in real wages in agriculture in recent years in the wake of a tightening labour market went to benefit the extreme poor. Second, expansion of social safety net programmes claiming roughly 2.0 per cent of GDP (13 per cent of budget), despite some limitations, helped lift extreme poor groups. Third, targeted income generating programmes carried out by NGOs and other organisations went a long way in reducing extreme poverty. And finally, rapid expansion of non-farm activities and increased market access has positive impacts.
To eliminate extreme poverty, a more serious commitment is necessary. One needs to remember that climate change would also exacerbate the incidence of extreme poverty. Economic growth should be broad-based. The existing social protection programmes need to be reformed in favour of the extreme poor. A strong inclusion strategy would immensely help reduce extreme poverty at a rapid pace than before. The extreme poor are reported to face shocks, particularly health related shocks, to undermine their productivity. Time has come to examine whether health insurance schemes could be introduced. And last but not least, the bottom 20 per cent should get special priority in the access to human capital.
The elimination of extreme poverty might sound a pipe dream but firm commitment by government, NGOs and donors could make it doable.
The writer is a former Professor of Economics at Jahangirnagar University
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