The way forward

From the second half of the 1970s until 2003, Professor Nurul Islam has written extensively on the Bangladesh economy. In all his writings, there is strong evidence of practical rather than purely academic insight. It is this quality that makes his thoughts useful, not only to practitioners and policy makers, but also to the academic community.

Looking Outward: Bangladesh in the World Economy (UPL 2004), is the published form of two lectures delivered by Professor Islam at BRAC University and it also includes a third essay titled The Image of Bangladesh in the Eyes of the International Community. As explained in the preface, it is derived from and closely linked to the first essay titled Challenges of Globalisation and Bangladesh. However, as will be explained later, his third essay: Thoughts on Indo-Bangladesh Economic Relations can be linked to chapter 18 of his earlier book titled Making of A Nation: An Economist's Tale (UPL 2003).

Challenges of Globalisation and Bangladesh

In this essay, Professor Islam deals with various issues relating to globalisation in the context of Bangladesh. It includes, apart from various aspects of globalisation, (a) the process of Bangladesh's integration in the world economy, (b) trade liberalisation and an assessment of its future directions in terms of growth, inequality, poverty, market access, and standards etc., (c) foreign private investment, (d) intellectual property rights (IPR), and (e) labour migration and overseas remittances.

All of the above issues have been debated and discussed in recent times in Bangladesh in the context of the WTO agreement. However, much of such debate have been more or less scattered or otherwise fragmented. Viewed from this standpoint, Professor Islam's essay fills a much needed gap that currently exists. In particular, his views on IPR indicate the ways to have a fresh look at such important areas as bio-technology in relation to crop seeds and pharmaceuticals.

Overall, the message that Professor Islam gives is that integration into world economy has its risks. The concrete examples he cites are (a) dependence on one or two commodity exports, (b) a large volume of workers' remittance, and (c) a significant and declining flow of uncertain foreign aid. To meet these challe

nges, he suggests development of substantial flexibility in economic structure and policy instruments to respond to or cushion against externally generated changes. He stresses the need for diversification of the sources of growth and foreign exchange earnings.

In this context, he draws particular attention to the need for upgrading of skills within the government to analyse, monitor, and respond, as well as adjust to the dynamics of world economy. He concludes by saying "Days of amateurs in political leadership have come to an end." Has it really? It is possible to view this remark as a pious wish. But what Professor Islam means is more serious than a pious wish. The risks associated with globalisation will demand a high level of political as well as bureaucratic professionalism without which the risks will far outweigh the intended gains.

Bangladesh in the Eyes of the International Community

This essay deals with the much talked of issue of Bangladesh's image as a Least Developed Country (LDC) and adds two other issues of corruption and governance which are also much discussed in recent times. The striking part of the much debated issues is that these are discussed at depth within a short space and supported by appropriate data grouped into 11 tables.

He begins by asking a pertinent question: when one speaks of the perception relating to Bangladesh's image, precisely whose perception is one referring to? The international community is not a homogenous commodity and many people abroad may not either know much about or may not have even heard of Bangladesh. He explains this further by saying that his analysis is based on the perceptions among the educated people who are generally interested in international affairs or world events. What has been left unsaid is that perceptions of poor image in respect of Bangladesh are mainly, if not wholly, limited to the aid-giving agencies, multilateral or bilateral.

About the image itself, he refers to the perception that Bangladesh is looked upon as a country haunted by or always in the shadow of famine as well as a country ravaged regularly by floods and cyclones that aggravate the hunger-poverty nexus. One would have expected that he would also refer to Bangladesh's achievement during the mid-nineties in achieving a level of food (cereal) production that is termed as self-sufficiency. Many country strategy documents of major donors acknowledge this.

What he mentions, however, is that perceptions of bad image are not immutable. The positive side he refers to is the remarkable achievement in micro-credit as well as that of ICDDRB. These achievements notwithstanding, his concerns relate to the state of governance that is characterised by confrontational politics, inadequate administrative and implementation capacity, limited accountability and transparency, poor state of law and order, and corruption.

All of the above characteristics have been covered by others such as independent think tanks, the donor community and the media in Bangladesh. It should be distinctly understood, however, that Professor Islam brings a fresh outlook on the much debated issue of corruption ranking. Drawing a comparative analysis between a World Bank study and that of Transparency International (TI), Professor Islam categorically states that inter-country comparison is difficult. This is difficult because the estimates following different methodologies and based on different sets of data will indicate (a) the ranks of individual countries are subject to wide margins of error, and (b) the margins of error widely differ among different countries.

The same freshness and analytical acumen are clearly visible in case of other indices of good governance such as voice and accountability, rule of law, political stability and regulatory capacity, and government effectiveness. Drawing on a World Bank study, Professor Islam concludes that in view of indeterminateness of ranking in respect of several indices of governance, inter-country comparisons become difficult, except in case where ranking is unambiguous.

While exploding the ranking methodology followed by TI in case of corruption and the World Bank in respect of good governance, Professor Islam, at the same time, sounds a note of caution that such ranking of countries influence the way in which and the extent to which the rest of the world conducts economic relations with Bangladesh. It affects, he goes on to say, the attitude of external traders and foreign investors towards Bangladesh and the flows of trade and investment. This message is loud and clear and should be noted.

Thoughts on Indo-Bangladesh Economic Relations

This essay provides an analytical and evaluative account of Indo-Bangladesh economic relations which, as stated earlier, was also part of his immediately preceding publication. The issues presented and analysed include common rivers, bilateral trade, a free trade agreement (FTA), migration of labour to India, and investment cooperation. Professor Islam draws attention to the fact that economic relations between India and Bangladesh are multifaceted ranging over a number of issues. Apart from the issues mentioned above, he refers to transit trade and export of gas. He speaks of the possibility of reducing trade imbalance if transit trade and export of gas issues could be resolved.

His remarkable analytical insight manifests itself when he says that facilitating mutually beneficial agreements will require placement of various components of relationships in a comprehensive framework rather than in isolation from each other. The success in this regard, he adds, will also demand a high level of statesmanship and leadership in both countries. It will also require patience and willingness to compromise and to take a long term view. He further concludes by saying that Bangladesh needs a great of expertise, negotiating skill, and self-confidence -- all necessary in economic negotiations.

In the preface of the publication, Professor Islam states that his intention is to explore issues, to ask question, and to stimulate debate, rather than provide answers.

As far as exploring issues go, the issues have not remained uncovered. As for stimulating a debate, these are much debated issues as his endnotes containing explanatory remarks indicate. The intention not to provide answers in fact shows that in most cases he has given useful and constructive suggestions. It is hoped that the policy makers and others having the interest of Bangladesh close to their heart will have enough food for thought in this publication.

AMM Shawkat Ali, PhD, is a former Secretary, Ministry of Agriculture.