THE white paper on the state of the Bangladesh economy that a 12-member committee formed by the interim government has come up with presents a more appalling picture of the economy during the Awami League regime than was feared. The white paper, in short, has shed light on the dark side of the development narrative that the Awami League government, toppled by a student-mass uprising on August 5. The paper finds that Bangladesh lost $16 billion annually on average between 2009 and 2023 because of the illicit fund flow amid systemic tax evasion, misuse of exemptions, and poorly managed public finances. The yearly illicit flow was more than double the combined value of net foreign aid and foreign direct investment. The white paper, which underscores the country鈥檚 shift from crony capitalism to kleptocracy, reveals that grand corruption has undermined the economy and pushed it into a precarious state, adding that deceptive data, lax financial management, reckless macroeconomic management, public finance pilferage, and external sector imbalances have created deep wounds in the economy. The paper has also found links between serious institutional flaws in sectors like banking, non-banking financial institutions, capital market and the energy sector and the launch of overpriced megaprojects and the huge outflow of illicit finance.
A democratic backslide, as evident from three fraudulent and managed national elections of 2014, 2018 and 2024, shaped the authoritarian AL government that promoted massive corruption and the rise of oligarchs. The paper has identified about two dozen channels of corruption and put the banking sector on top of the most corruption-ravaged sector, followed by physical infrastructure, energy and power and information and communication technology. Massive irregularities, such as giving control over banks to certain people and politically influenced lending practices, destabilised the sector, which is, as the paper says, now overburdened with a record of distressed assets of Tk 6.75 lakh crore as of June 2024, equivalent to the cost of constructing 14 Dhaka metro rail systems or 24 Padma Bridges. The extent of irregularities can be surmised from the fact that only one group, S Alam Group, alone controlled six banks and alone took about Tk 2 lakh crore from the banks, violating rules. The white paper also reveals that $14鈥�24 billion was lost to political extortion, bribery, and inflated budgets with the annual development programme projects in the past 15 years. The white paper has also shed light on irregularities in some other important areas. For example, the paper reveals that 73 per cent of social safety net beneficiaries were non-poor. This suggests that the social safety net programmes have not benefitted the people they are meant for.
The white paper, while exposing the atrocious extent and length of systematic looting during the Awami League regime, now warrants that the interim government takes it as a roadmap to recovery. The path to recovery will understandably be long and arduous, but not impossible. The government now must make a concerted effort to bring back the economy into shape. It should prioritise bringing back stolen assets, disciplining the banking sector and establishing transparency and accountability in all sectors.
