Bangladesh's Economy
From War and Famine to Growth
How Bangladesh was born in 1971 after a devastating war, faced famine in 1974, and began a long climb from extreme poverty.
Bangladesh became independent in December 1971 after a war with Pakistan.
A devastating start
- The Liberation War killed huge numbers of people and displaced millions, many as refugees in India.
- Infrastructure was destroyed.
- Bangladesh was one of the world’s poorest countries.
The 1974 famine
- Floods, rice price spikes and weak food distribution caused a famine in 1974.
- Amartya Sen later showed it happened without a big fall in overall food availability; poor people lost the entitlement to buy food as prices rose.
Early challenges
- High population growth.
- Political instability, including coups.
- Dependence on aid.
The turnaround
From the 1990s, growth accelerated, reaching around 6 percent or more a year for years.
Today
Bangladesh’s income per person rose rapidly and at times rivalled or exceeded India’s by some measures around 2020-21.
The entitlement failure
In 1974, a landless labourer in Bangladesh couldn't afford rice after prices soared, even though rice was available in markets.
Thinking famines are always caused by lack of food
The 1974 famine was about people losing the ability to buy food.
Key takeaways
- Bangladesh became independent in December 1971.
- It started as one of the world's poorest countries.
- The 1974 famine was an entitlement failure.
- Growth accelerated from the 1990s.
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