Bangladesh and the Cost of Rapid Growth

Bangladesh is a densely populated Southeast Asian country on the delta of the Padma (Ganges) and the Jamuna rivers. The land was initially fought over by Hindu and Buddhist kingdoms that sought control of the lush Bengal region. A rich and prosperous country it generated almost half the Mughal empires wealth and 12% of the worlds GDP (Bayly, 1998). From 1757 the country was under British rule as an Indian province of Bengal. Unmonitored exploitation, not unusual for the British, was used to amass capital for the colonialists. With political deprivation and penury came a slow but passionate movement to leave Pakistan and claim independence. After the 9-month long Bangladesh Liberation War, leaving three million dead, Pakistani forces surrendered on 16th December 1971 and Bangladesh became and independent country.

The Economy

Bangladesh’s economy is the second largest in South Asia and is one of the fastest growing economies in the world until very recently. Bangladesh has risen from one of the poorest nations in the world, in 1971, to reaching lower-middle income status in 2015 (World Bank, 2023). Largely from the ready-made garment industry, the country is seen as great success, with poverty down from 41.9% in 1991 to 13.5% in 2016 (World Bank, 2023). Despite seeming to recover from the Covid pandemic quickly the country now faces ‘significant challenges’ according to the International Monetary Fund. (IMF, 2023). The IMF has loaned over $4.7 billion this year to help with the fall in exports, 16.5% in a year, and remittances, also down 16%. (Chaube, 2023). The loan was aimed at “creating fiscal space to enable greater social and developmental spending; strengthening the financial sector; modernising policy frameworks; and building climate resilience.” (IMF, 2023). However, despite the economy deaccelerating from 7.2% to 5.2% in 2021-2022 the outlook is growth will return to 6.5% in 2023-2024 (IMF, 2023). 

There is no doubt that the IMF and Bangladesh have grave concerns for the effect of climate change on the country and the IMF specifically reference ‘that in addition to tackling these immediate challenges, long-standing structural issues and vulnerabilities related to climate change will also need to be addressed to accelerate growth, attract private investment, enhance productivity, and build climate resilience’ (IMF 2023). It is the intention that the loans will help with these factors.

The plan is that more money, more private investment, more production will build better countries. There is no doubt that Bangladesh has emerged from poverty through foreign investment and trade policies. But at what environmental and social cost?

Part 1 – The Cost of Growth in Bangladesh

Most developing countries are focussing on increasing growth. This is to better their population’s quality of life and reduce income inequality. However, increasing productivity, trade, agriculture, and other growth activities, also increases energy consumption and thus carbon emissions. Research has shown that economic growth means greater impact on the environment (Yang et al 2022).

Focus on Fast Fashion

One of most important industries in Bangladesh is the ready-made garments (RMG) industry. Bangladesh is the second largest producer of RMG, following China. 83% of the country’s exports are clothing and over 20 million people work in the industry. In 2006 the total apparel exports were only 2.8%, now RMG is estimated to be 20% of the GDP. Making clothes for the Global West is big business in Bangladesh (Armin, 2020).

There are several major costs when we delve deeper into this area of growth.

a)      Environmental costs

Textile production places a high toll on the environment. Water consumption and carbon emissions are some of the highest in the world in this sector.  Textile production’s environmental impacts cross the entire supply chain. From the cotton cultivation phase, using mega litres of water and heavy machinery, to the dyeing and weaving and the transportation of the garments. Research has found the textile supply chain uses 1.5 trillion litres of water a year and is responsible for 20% of industrial water pollution (World Bank, 2023).  10% of the global greenhouse gas emissions come from this sector, which is over 1.7 billion tons of CO2 (Mamun et al 2022).

Bangladesh ranks 162nd out of 180 in Environmental Performance Index (EPI) report and is one the most polluted countries in the world. In Bangladesh huge volumes of water are extracted to produce textiles and this depletes groundwater at a rapid rate. In addition, toxic water effluent can contaminate rivers and other waterbodies, reduce the oxygen in water and effect ecosystems, which indirectly causes climate change (Hossain et al, 2018). Currently extraction is greater than the recharge of aquifers and the energy it takes to drill lower and further will increase emissions and heavily impact the RMG industry, along with the environment it exists within (Mamun et al, 2022). A study by Kahn et al in 2016 found the water level in Dhaka has fallen 60 metres in the last 50 years and this trend is continuing.  

The specific impact of discharged wastewater is extreme. The toxic water may increase the water temperature which causes quick changes to the ecosystem within and can influence the climate (Neville et al, 2010). Bangladesh is already dealing with this cost of growth in the RMG industry on the environment. Many factories are based near the waterways and it here there is dire pollution in the Buriganga, Shitalakkhya, Turag and Dhaleshwari rivers (Mamun, 2022).

The Bangladesh government is fully aware of the issues with the textile industry and contamination of waterways. Several laws have been passed to attempt to regulate the producers. The ‘Bangladesh Environment Conservation Act (ECA, 1995) and ‘Environmental Conservation Rules (ECR, 1997) were devised to ensure textile dyeing industries treated and monitored their wastewater quality, adhering to a national standard. There is continuing pollution, however, and the laws are not being enforced sufficiently ana the water quality is deemed ‘questionable’ (WHO, 2018).  A study in 2022 found water close to the industrial zone had high levels of heavy metals, pesticides and emerging contaminants – these are a group of pollutants that can be lethal for humans and wildlife endocrine systems even in trace quantities (Parvin, 2022). The study also found high levels of micro plastics and agricultural pesticides and for the first time the cancer risk of ingesting the water was evaluated and considered to exist in most parts of the country. Flash flooding is an existing geographical issue for the country, and many areas having no sanitation facilities thus faecal coliform is also found throughout the water sources in Bangladesh.

1.     Urbanisation and Heat

‘Bangladesh, a low-lying deltaic nation, with an overall population of 162 million and a density of 1120 km2, is one of the most susceptible nations to climate change’ (Rahman et al, 2022). Already susceptible purely because of its geography, the country now faces major issues with rapid urbanisation and industrialisation.

Following a global trend, people have moved from agricultural work to industry, namely the textile sector, and settled in the larger cities, especially Dhaka. Over 37% of the population now live in urban areas (Teng, 2021). Urbanisation is generally seen as a ‘necessary component’ of growth (Raihan, 2022).

The problem with creating more houses, industries and infrastructure is the increased energy use to build them and then to run them. Rapid urbanisation also increases environmental degradation (Raihan, 2022). This relationship between cities and CO2 emissions is key when assessing the cost of growth for Bangladesh. Emissions are rising at the same time as economic activities are rising and industrialisation occurs (Murshed & Saaqdat, 2018). Many mega cities are suffering or due to suffer the most from climate change. Indeed, Indonesia has announced this month that the capital will be moving. Jakarta is sinking so they will build an entirely new city, Nusantara, to avoid raising sea levels and flooding (Beech, 2023).

Urbanisation also relates to the increased surface temperature and urban heat island intensity (Rahman et al, 2022). Heat is expected to be one of the biggest killers as the planet’s temperature rises and developing countries are unprepared (Thompson et al 2023). 

2.     Exploitation and Human Costs

Over 1375 people have died in garment factory incidents in Bangladesh.  Prior to The International Safety Accord, an agreement promoting workplace safety, Bangladesh had experienced several shocking disasters killing workers. The 2013 Rana Plaza disaster killed 1,134 people and injured over 2500. It is considered the deadliest structural failure in modern history (BBC, 2013). Making clothes for Zara, Walmark, Primark and other popular Western brands, the building was owned by a Sohel Rama, a young member of the party in power, the Awami League. Cracks appeared the day prior to the collapse but Rama ordered all factory workers back to work the next day. More than half the dead were women and many of their children in the nursery facility. The Bangladeshi government refused help from the UN and instead insisted they had the rescue operation under control. The rescue operation was utterly inadequate, and many suggested the government left people to die to save face (Nelson, 2013).

Leaders across the Global West, including the Pope, expressed their shock and concern for the situation in Bangladesh. Nick Clegg the Deputy Prime Minister of the UK said, ‘consumers have more power than they think when it comes to making choices where they shop’ (Mason, 2013).

This another example of cost of economic growth on Bangladeshi workers. The price of employment and growth for the country is taken on by the factory workers, the poorly paid, often women, trying to exist in a developing environment. Huge multinational companies exploit these people, paying very little and offering substandard working conditions. People have no other choice. They have left their villages and now provide for their families. Losing their jobs comes at a monumental price.

There is no doubt that business as usual cannot continue for Bangladesh. The immediate health risk and environmental concerns are too great to be ignored. Urbanisation and land use change has occurred and there is now a need to find solutions for the extreme energy use, the increased heat and the toxic water.

Part 2- The Solution and how to measure success

Rapid growth in Bangladesh has caused loss of surface water bodies, urbanisation, land clearance, hydrological ecosystem changes and waterway pollution (Rashid, 2022). However, The World Bank reports a ‘remarkable story of poverty reduction and development’ (World Bank, 2023).

Herein lies the conflict between growth and environmental cost.

The World Bank also offers statistics like, ‘19 million Bangladeshis are reliant on forest for their livelihoods’, and that 28% of deaths in Bangladesh are caused by air and water pollution.

The World Bank has invested over $545 million to help mitigate the effects of growth and climate change. Three main projects -the Sustainable Forests & Livelihoods Project (SUFAL) the Bangladesh Sustainable Coastal and Marine Fisheries Project (SCMFP) and the Sustainable Enterprises Project (SEP)  - are helping to restore forest and ecosystems and adopt environmentally positive practice and health and safety measures. This report has found that there is some improvement in the forest degradation and the coastal fishery systems, but there are much larger issues of regulation for international businesses, lack of investment in renewable energy and a continued commitment to economic growth with environmental sustainability as second priority.

While the government has attempted to enforce new laws, there is a fundamental need to change practices in the entire textile sector. The government gains vast economic wealth from these factories and there is much at stake if the current system is contested.  Fast Fashion IS the Bangladeshi economy.  The country is bound by economic power from the Global West. The ultimate solution comes from major global reform. To hold companies accountable for their working conditions and for the products they produce is crucial. Providing more sustainable production is key. As only %1 of clothing is recycled, we must change our entire relationship with the fashion industry, at every stage of the chain. Addressing the ‘affluenza’ epidemic in the Global West and the way we measure our success as humans is imperative, though seemingly unrealistic. More is more cannot remain the indication of happiness and well-being if we are to exist on a finite planet. 

Existing Within Natural Limits

The question is how do we change our current system and exist within the planets limits whilst still enjoying healthy life expectancy, and standards of living?

Bangladesh is an ideal example of where growth has brought extreme positive and negative effects and at a rapid pace.

With a complete transition to a circular economy and reduction in our global consumption unlikely there are several other solutions to help alleviate the costs of growth in Bangladesh.

1.     Bangladesh needs investment and policy strategies to increase environmentally friendly technological upgrades in its industries, especially textiles and agriculture. Subsidies for low-carbon technology and tariff for polluters is needed. The move to renewable energy is essential to reduce the excess energy use impact.

2.     With war in Ukraine has come fuel and food prices increases. Better local options and more diverse global partnerships are needed (Bhowmick, 2023).

3.     Better policy and assessment to inhibit international companies from exploiting workers and land, by using subcontractors and other means to avoid regulations.

4.     Protection for workers needs to be instilled. The World Bank notes ‘compared to only 5 percent of working men, one in three working women are not paid for their work’ (World Bank, 2023). Targeted labour programmes are needed to remove barriers and address the inequality and low wages for Bangladeshi’s poor.

5.     Building a culture where workers, locals and the environment are safe and public and planet health is regarded as a priority, not just production rates and growth.

Measuring Success or Failure

Reviewing literature for this paper it is apparent that measuring the success of Bangladesh purely on GDP is not a good indication of the country’s wellbeing. The UN’s Sustainable Developments Goals are extensive and detailed. Simpler and more holistic measures of sustainability and wellbeing are urgently needed for policy and reform to achieve the UN’s goals (Kubiszewski et al, 2021).

Measuring how a country is faring is complicated. Using GDP as an indicator of success is embedded in our linear economic model and it was never intended to be a measure of wellbeing (Costanza, 2016).  There are several new measurement frameworks appearing, with the Sustainable Wellbeing Index looking the most promising.

 Robert Costanza and colleagues note in their paper ‘Modelling and measuring sustainable wellbeing in connection with the UN Sustainable Development Goals’ –

 ‘We need to replace the misuse of GDP as a measure of national success with not just an alternative indicator of wellbeing, but also with a dynamic, non-linear, systems model of the entire system of the economy-in-society-in-nature that keeps track of both stocks and flows’ (Costanza et al, 2016)

 There is the need to cover many indicators and time frames to truly assess a country’s success and provide information for prediction and reform.

The Institutional Quality Measurement

Much of our wellbeing and our environments future health is now directly associated with policy. A government can have the power to ban coal mines or build new ones with lengthy and expensive legal contest the only way to challenge them. In less democratic countries it is even harder to control a government whose main priority is economic development and growth. Many developed countries find the institutions that control the laws skewed towards economic development and see the environment and well-being for the entire population as a second priority. Bangladesh is no exception.

Samdi (2008) describes the main role of institutions ‘is to organize groups, facilitate interaction and coordination between them, reduce uncertainty in economic activities, and encourage economic development (Samadi, 2008). This paper suggests that beyond this, good quality institutions play an integral role in creating sustainable practices and mitigating the effects of climate change and the costs of growth.

Mehmood et al (2020) conducted research that found by having strong institutional quality environmental pollution can be lessened. They note ‘institutional quality measured by the political terror scale (PTS) affects CO2 emissions positively and thereby degrades the quality of the environment in both the long and short run’ (Mehmood et al 2020).  There is a plethora of research on the nexus between institutional quality and emissions (Mehmood et al 2020; Islam et al 2021; Kahn et al 2022; Teng et al 2021). Researchers have found ‘that institutional quality such as government effectiveness and the rule of law reduce CO2 emissions and promote environmental quality in developing countries’ (Xaisongkham & Liu, 2022).

Overall, the use of one scale will never provide a complete picture of a country’s wellbeing across many variables. This report has found that by incorporating the quality of countries institutions as a fundamental measure, there are a number of indicators that directly contribute to sustainability, environmental degradation and the wellbeing of the population and therefore it should always be included as a measure for progress. Simpler than a complicated framework, including institutional quality and indicators such as income inequality, health care, food security, infrastructure and manufactured goods could provide a holistic assessment of a country and its progress. 

Conclusion

Recent mass protests in Bangladesh indicate that there is dissatisfaction in the current government.  The country is experiencing very high inflation, due to global food and fuel rises. The Bangladeshi Taka has depreciated by 25% and the cost of living for many is not sustainable. Bangladesh is considered one of the most corrupt countries in the world and it is only by addressing this and ensuring quality institutions to protect the population’s wellbeing and prepare for climate change, will the country avoid the imminent catastrophic cost of growth and climate change. Further research on institution quality and its relationship with wellbeing and sustainability is recommended.

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