Labeled as a "basket case" by Henry Kissinger in 1972, this young nation stands today as a template of growth and economic success. Bangladesh started as a country with a low income per capita along with nations such as Chad, Rwanda, Burundi and Nepal

As Bangladesh marks its 51th independence anniversary this year, its tremendous economic growth has made it an emerging hub of regional connectivity, attracting more trade and investment opportunities. According to the World Bank, the country is among the fastest growing economies globally over the past decade, supported by a demographic dividend, strong ready-made garment (RMG) exports and stable macroeconomic conditions.

Sri Lanka and Pakistan could follow the 'Bangladesh Economic Miracle' model to avert their economic crises.

On April 7, Friedrich Naumann Foundation for Freedom (FNF South Asia), Regional Office in New Delhi, India had organised an online discussion on "Bangladesh: Henry Kissinger's basket case is an economic success".

Labeled as a "basket case" by Henry Kissinger, the US secretary of state in 1972, this young nation stands today as a template of growth and economic success. Bangladesh started as a country with a low income per capita along with nations such as Chad, Rwanda, Burundi and Nepal.

Today, the country has crossed the per capita income threshold of US$ 2,000, with a GDP of about US$ 355 billion, making it among the top 40 economies of the world in terms of GDP.

From being an extremely poor country in the 1970s, today Bangladesh is confidently marching towards becoming a middle-income country before the decade is over. It will be graduating from a middle-income country, and that is quite a huge accomplishment.

While Bangladesh's journey over the last 50 years is highly admirable, in the coming years and decades, it will have to address challenges to support or even do better than what it has done so far. From my perspective, Bangladesh has become an important partner of Germany. And as a member of the German Parliament, it is my goal to further ease the cooperation and ties between the two countries.

Bangladesh has fulfilled all the requirements for graduating out of the LDC status in 2026. The question is, how did that happen? The fundamental answer is, of course, the toil and sweat of its workers, people, farmers, entrepreneurs, investors, policymakers and NGOs. Its people are its main resources.

The systemic exploitation of then East Pakistan,followed by massive destruction of the economy, infrastructure and livelihoods caused by the Liberation War, posed insurmountable challenge to the government of the day. Millions of people returned home from India to a war-ravaged country and had no food, no shelter, no medical help and other basic needs. It is at this point that Kissinger called it a basket case.

It is well known that since the 1980s, Bangladesh has made astonishing progress in a wide variety of development indicators, such as reducing extreme hunger and poverty, increasing primary education, and reducing child and maternal mortality, among others. This progress has been mirrored by an impressive record of sustained GDP growth, and much, if not most, of Bangladesh's development has happened outside the purview of successive governments.

For example, the 2003 World Bank report showed that 34.1 per cent of all foreign aid was distributed to the NGO sector. The vibrant NGOs and civil society organisations working across the spectrum of development issues have been the principal drivers of progress.

Apart from showcasing markers of economic and societal growth, Bangladesh has also seen a transition toward digitisation, which has effectively given rise to a growing pool of entrepreneurs who are positively impacting lives in both urban and rural societies through greater financial inclusion. Bangladesh is now a role model for other developing countries, owing to the participation of many stakeholders in both the public and private sectors.

The coronavirus pandemic has devastated world economies, including those of all South Asian countries, including Bangladesh.

However, in the midst of the pandemic, Bangladesh has surpassed the South Asian countries in terms of economic development.

This success has been achieved mainly through the manufacture and export of ready-made garments and remittances from expatriates.

The World Bank, has given a positive outlook on the South Asian economy, overcoming the effects of the pandemic. But Bangladesh is ahead of its two neighbours, India and Pakistan, in achieving high growth, and has set a growth target of 6.1 percent for the current fiscal year and 7.2 percent for the next fiscal year.

Although Bangladesh is ahead in per capita GDP, India is one of the largest economies in the world in terms of size. India's economy is 10 times bigger than Bangladesh's. The best way to understand how rich a country's citizens really are is to determine how much purchasing power they have. This is why the size of the GDP is calculated on the basis of purchasing power parity (PPP) to compare the economies of different countries. According to the IMF, India's share of the world's GDP on a PPP basis this year is 7.39 percent, while Bangladesh's share is only 0.659 percent.

In terms of GDP growth, Bangladesh surpassed India for two consecutive years, but in some social indicators, Bangladesh surpassed the neighbouring country seven years ago.

For example, Bangladeshi girls have a higher education rate and female birth rate than Indian girls. In Bangladesh, infant and under-five mortality rates are lower than in India.

India is a very big country.

There are states like Bihar and Chhattisgarh, as well as states like Delhi and Punjab. So, on average, the real picture of everyone does not come up. But Bangladesh is undoubtedly doing well.

Bangladesh has in the last 50 years performed better than Pakistan, the nation it separated from, says International Forum for Rights and Security (IF- FRAS), an international think tank headquartered in Toronto, Canada.

Bangladesh has shown the way. Sri Lanka can follow this model to avert its economic recession as Bangladesh's rise is 'from a bottomless basket to an economic rise model'.

Rozario is a researcher, and strategic and international affairs analyst based in Karnataka, India

A version of this article appears in the print on April 28, 2022, of The Himalayan Times.