Sept 2022

Treading a tightrope

Beset by soaring inflation and political controversy, Bangladesh’s government will need to perform a delicate balancing act to get the country back on track, writes Syed Badrul Ahsan 

In these troubled times, Bangladesh is in a difficult, if not precarious, situation. The knock-on effects of the Ukraine war have created a crisis from which the government of Prime Minister Sheikh Hasina is finding it hard to emerge. It has grievously affected the country’s middle- and lower-income classes, who have lately found it hard to put decent meals on the table for their families.

Add to that the ramifications of Covid, which have left economic production battered and bruised. Although a slow recovery is being made in garments exports, a main stay of Bangladesh’s economy, clearly it will take time for the sector to claw its way back to where it once was. There is, too, the fact that remittances by Bangladeshi migrant workers, particularly those employed in the Middle East, have shrunk, while foreign exchange reserves have dwindled to $39bn.

Fuel prices have been raised by the government by a whopping 50 per cent-plus, a step that has further upended finances for families across the country. The cost of electricity has increased, but that is not the only problem. The government has now decreed measures aimed at rationing electricity for domestic use, as well as in industrial installations nationwide. The supply of gas to homes and factories has also been subjected to state control.

The prices of all food items, including vegetables, fish, meat, lentils and cooking oil, have taken a leap, to a point where people are being forced to eat less. In restaurants, even the most basic food items have registered a rise in cost.

In Bangladesh, where price manipulation by traders’ syndicates has been a fixture for decades, it is difficult to see how the authorities will be able to rein in escalating prices, which have led to protests in the capital Dhaka and elsewhere. The government response has been limited to assurances that conditions will soon return to normal.

Meanwhile, a deeply worried Sheikh Hasina has called on western nations to lift the sanctions imposed on Russia following its invasion of Ukraine. She has done so for good reason: the sanctions have been crippling the economies of countries like Bangladesh, a situation exacerbated by the lack of rain, which has affected crop production.

ESCALATING ANGER: Soaring prices have triggered protests in the street of Dhaka

In so far as politics is concerned, Bangladesh is in a state of ferment, with the next general election scheduled for the end of 2023. In a society where political parties, especially the larger ones, have traditionally never opted for compromise or accommodation with one another, every election since the restoration of civilian government in 1991 has been marred by controversy.

The last one, held in December 2018, led to accusations by the opposition that it was rigged, indeed that ballot-stuffing in favour of the ruling Awami League had taken place during the night preceding the day of the voting.

Today, a new Election Commission is in place. The new Chief Election Commissioner, Kazi Habibul Awal –a retired bureaucrat, in common with some of his predecessors – has been meeting leaders of the various political parties, with the aim of working out a system of foolproof voting next year. The problem is that the Bangladesh Nationalist Party, the country’s leading opposition body, has refused to recognise the commission and has been boycotting all sessions with the CEC.

The party and its allies would like the next election to take place under a neutral caretaker government, a condition the ruling Awami League has steadfastly refused to accept. The provision of a caretaker government, as enshrined in the nation’s constitution in the mid-2000s, was done away with by an electorally triumphant Awami League some years ago. The government argues that all elections will be held with the ruling party holding the leverage of power.

Price manipulation by traders’ syndicates has been a fixture for decades

Political temperatures around the election are therefore rising. These temperatures recently took a quantum leap when Foreign Minister A.K. Abdul Momen publicly revealed, at celebrations marking the Hindu festival of Janmashthami in Chittagong, that on his last visit to Delhi he had requested the Indian government to do everything possible to ensure that Sheikh Hasina’s government stays in office when the next election takes place. His remarks, which he has subsequently denied making but which have been recorded on video, have predictably led to a firestorm of nationwide protests.

Demands for the minister’s resignation or dismissal have poured in. But the government, despite the embarrassment caused by such remarks from the nation’s top diplomat, appears to be in no mood to axe him. Bizarrely, the Foreign Ministry has, in fact, leapt to Momen’s defence, stating in a press release that his remarks had been ‘distorted’ by the media.

Two of the Foreign Minister’s senior colleagues, as well as a senior leader of the ruling party, have made it known that the Awami League does not require the support of a foreign government to stay in office. Yet Momen is, for the time being at least, holding on to his position.

Every election since the restoration of civilian government in 1991 has been marred by controversy

Meanwhile, the celebratory mood across the country following the inauguration of the Padma Bridge over the mighty Padma river, a project undertaken with the nation’s own resources, has been dimmed by the growing economic crisis. Bangladesh is certainly not in the position Pakistan is in; nor are there any fears of its going the way of Sri Lanka. However, the reality that the economy is in less than good shape is all too apparent from the government’s request for a loan of $4.5bn from the IMF, and loans are also being sought from the Asian Development Bank.

On the diplomatic front, Prime Minister Sheikh Hasina will travel to Delhi on an official visit early in September. Chinese Foreign Minister Wang Yi took a whirlwind trip to Dhaka, but clearly the Bangladesh government, with its emphasis on a strategic relationship with Russia, India and China, was unwilling to be seen as leaning more towards Beijing and hence causing cracks in its diplomatic edifice.

An additional and persistent pressure on the economy, which also has a diplomatic slant, has been caused by the influx of Rohingya refugees from Myanmar’s Arakan state. There seems little prospect of a resolution to the conflict, with contact between Dhaka and Naypyidaw on the issue as good as non-existent.

STARTLING REVELATION: Bangladeshi Foreign Minister A.K. Abdul Momen

Domestically, the state of human rights in Bangladesh remains a major concern for foreign governments and international rights bodies. The significance attached to this issue was exemplified by the recent visit to Dhaka by Michelle Bachelet, the UN High Commissioner for Human Rights. Families of citizens who have disappeared in recent years have regularly been demanding their return, or at least reports of what has happened to them.

In brief, conditions in Bangladesh are difficult but not dire. For the government, which has been in office since January 2009, new policies need to be shaped and strategised, lest the administration begin to suffer from the fatigue that so often ensues from an extended hold on political power.

Among those policies ought to be a widening of space for the political opposition, in line with democratic convention. Needed, too, are smart measures that will help the country ride out the economic crisis in which it is currently embroiled. It is a tightrope that Bangladesh, and its leaders, will have to tread carefully.

Syed Badrul Ahsan is a Bangladeshi journalist and political commentator based in London. He is the author of biographies of Bangladesh’s founder Sheikh Mujibur Rahman and the country’s first prime minister Tajuddin Ahmad