THE latest World Bank report showing that poverty in Bangladesh increased to 21.2 per cent in the 2024–25 fiscal year, up from 20.5 per cent a year ago, is a troubling reminder that the economic recovery remains fragile. The World Bank attributes the poverty rate to a combination of factors, including slow growth, stubbornly high inflation and a weakening labour market. The Power and Participation Research Centre in May reported even a higher poverty rate, which substantiates the crisis. Extreme poverty, too, increased from 5.6 per cent in 2022 to 9.35 per cent this August. The figures highlight widening economic distress, especially for low-income households, with their growing dependence on debt flagged as a major vulnerability. Prices, especially of food, continue to rise faster than wages. Rice, a staple food that accounts for the largest share in the household consumption basket, has recorded double-digit inflation for months. The interim government has taken some steps, including a tight monetary policy, reduced import duties and improved harvests, but the measures have yet to ease the burden on the public at large.
Economists put the growing poverty down to a combined impact of political instability, weak investment confidence and financial sector fragility, but the government appears to be relying on the rhetorical strategy of denial. The finance adviser has questioned the World Bank’s methodology and said that determining poverty rate by interviewing 5,000 people cannot be conclusive and that ‘the appearance and outlook of people would,’ rather, ‘be more accurate.’ The debate about methodology diverts attention from the fact that people are struggling to meet their basic needs. The regime change in 2024 and lingering political uncertainty have discouraged both private and public investments. Without fresh capital, job creation has stalled, trapping millions in a cycle of underemployment and poverty. The recent murder and suicide of four of a farmer’s family depicts a grim reality of silent hunger and extreme poverty. A man, his wife and their two children were found dead in their house in Rajshahi on August 15. The police suspect that it was a case of murder and suicide driven by debt and hunger. The deaths in Rajshahi are not isolated. The Multidimensional Poverty Index, released by the General Economics Division in July, said that one in four people is poor and about 3.98 crore individuals suffer multidimensional poverty.
Rising poverty is a warning that millions are left behind in a transition that promises reform but has yet to deliver relief. The government should, therefore, recognise the growing inequality and vulnerability that inflation and unemployment have deepened and take immediate steps to expand social safety nets, subsidise major food items and prioritise projects that generate employment. The government should shift the focus to restoring investor trust, improving governance and ensuring policy consistency.
