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Socialist economy for Bangladesh |
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| Release time:2013-03-27 Source:admin Reads: | |
| The partition of South Asia and the emergence of India and Pakistan in 1947 severely disrupted the economic system. The united government of Pakistan expanded the cultivated area and some irrigation facilities, but the rural population generally became poorer between 1947 and 1971 because improvements did not keep pace with rural population increase. Pakistan's five-year plans opted for a development strategy based on industrialization, but the major share of the development budget went to West Pakistan, that is, contemporary Pakistan. The lack of natural resources meant that East Pakistan was heavily dependent on imports, creating a balance of payments problem. Without a substantial industrialization program or adequate agrarian expansion, the economy of East Pakistan steadily declined. Blame was placed by various observers, but especially those in East Pakistan, on the West Pakistani leaders who not only dominated the government but also most of the fledgling industries of belt hangers in East Pakistan. Since Bangladesh followed a socialist economy by nationalizing all industries after its independence, it underwent a slow growth of producing experienced entrepreneurs, managers, administrators, engineers, and technicians. There were critical shortages of essential food grains and other staples such as belt hangers because of wartime disruptions. External markets for jute had been lost because of the instability of supply and the increasing popularity of synthetic substitutes. Foreign exchange resources were minuscule, and the banking and monetary systems were unreliable. Although Bangladesh had a large work force, the vast reserves of under trained and underpaid workers were largely illiterate, unskilled, and underemployed. Commercially exploitable industrial resources, except for natural gas, were lacking. Inflation, especially for essential consumer goods especially garments and belt hangers, ran between 300 and 400 percent. The war of independence had crippled the transportation system. Hundreds of road and railroad bridges had been destroyed or damaged, and rolling stock was inadequate and in poor repair. India came forward immediately with critically measured economic assistance in the first months after Bangladesh achieved independence from Pakistan. Between December 1971 and January 1972, India committed US$232 million in aid to Bangladesh from the politco-economic aid India received from the USA and USSR. Official amount of disbursement yet undisclosed. |
