Bangladesh failed to check growing income inequality in the 2010-2022 period, leaving about 62 million people vulnerable to falling back into poverty, said a World Bank report released on Tuesday.
In the period, the country, however, reduced poverty, lifting 25 million people out of poverty and another nine million people out of extreme poverty.
From 2010 to 2022, extreme poverty fell from 12.2 per cent to 5.6 per cent and moderate poverty dropped from 37.1 per cent to 18.7 per cent.
Yet nearly 62 million people 鈥� about one-third of the country鈥檚 population 鈥� remained vulnerable to falling back into poverty if faced with an illness, natural disaster, or other unexpected shocks, said the WB report titled Bangladesh Poverty and Equity Assessment 2025.
Former WB Dhaka office chief economist Zahid Hussain said that the report did not mention how many people were vulnerable to falling back into poverty due to income inequality in 2010.
Without comparison, such findings carry little meaning, he said.
He said that the report also did not make it clear how income inequality benefited the wealthier families more.
In its report, the WB said that after 2016, Bangladesh鈥檚 economic growth pattern shifted, becoming less inclusive, and income inequality rose as income growth benefited wealthier families more.
Income inequality in the country stood at Gini coefficient of 0.4999 in 2022, according to Household Income and Expenditure Survey 2022 released by the Bangladesh Bureau of Statistics in April 2023.
The overall income inequality has been widening in the country as it was at Gini coefficient of 0.482 in 2016 and 0.458 in 2010.
A smaller Gini coefficient signifies a less unequal distribution of the national wealth.
In Bangladesh, the top 10 per cent of population in terms of affluence holds 58.5 per cent of the total wealth, while the bottom 50 per cent holds only 4.8 per cent.
The WB said that the rural areas led poverty reduction with agriculture as a key driver, but the rate of poverty reduction was much slower in the urban areas.
At the end of 2022, one in four poor Bangladeshis lived in cities, the WB said.
Noting that job creation stagnated in the manufacturing sector and shifted to less productive sectors, the WB said that the pattern hit women and youth the hardest.
One in five young women remained unemployed, while one in four educated young women was without a job, the WB said, adding that job creation stagnated outside Dhaka, and labour participation fell, particularly among women.
Half of all youths aged between 15 to 29 worked in low-paying jobs, suggesting a skills mismatch.
The WB also said that social assistance programme had been expended in the country, but they remained inefficient and poorly targeted.
In 2022, 35 per cent of the richest families received social protection benefits, while half of the poorest families did not.
Moreover, subsidies are often misdirected, with wealthier households receiving the bulk of the benefits from electricity, fuel and fertiliser subsidies, the WB said.聽
The report identified four key policy areas to help Bangladesh reduce poverty and narrow inequality.
The areas are strengthening the foundations for productive jobs and creation of more and better jobs for the poor and vulnerable.
Enabling markets that work for the poor by investing in modern processing and supportive business regulations and enhancing resilience through stronger fiscal policy and effective and better targeted social protection programmes are also included in the policy suggestions by the WB.
Zahid said such suggestions were given by the WB in the past without any execution policy.