Our economic growth rate is expected to hit 7.65 per cent in the current financial year, supported by industrial and agricultural sectors. Our planning minister informed us. The gross income per head of the country is also expected to pick up by 8.82 per cent to USD 1752 in the financial year (FY) 2017-18 from USD 1610 in the last financial year. Bangladesh Bureau of Statistics (BBS) gave us this data.
We can safely say that the gross Domestic Product (GDP) growth of the country at constant price has broken all the previous record in our history. The country joined the rank of the "7.0 per cent growth club" two years ago in financial year 2015-16. In the FY 2016, Bangladesh's economy expanded at 7.11 per cent rate, breaking past the "6.0 per cent growth trap" after a long nine years.
The 7.65 per cent growth in the current fiscal is even higher than the 7.4 per cent target as set in the current fiscal's national budget. Planning Minister AHM Mustafa Kamal disclosed the data on briefing reporters after the meeting of the National Economic Council (ECNEC). We are passing comment only. The planning minister said, the investment, exports and remittances have picked up this year along with the impressive industrial sector growth have contributed a large to expand the economy. Besides, the government has been handling the macro economy in a matured way.
Much debate on attaining economic growth has been created among the economists. Particularly so far incremental capital output ratio (ICOR), the investment-GDP ratio and the size of the population are concerned, this growth target and per-capita income come in debate to some economists. But we are less concerned about this. We think at the end of financial year, final counting will make it clear. So we have to wait for final comment. But it is more than sure our economic structure gains that resiliency to take the growth to a height above 7 per cent breaking perennial 6 per cent growth trap. But our apex headache is hovering on the qualitative aspect of growth approach.
Mainly on the nature of its inclusiveness. Only quantitative measurement will not ensure the real development of the masses. Question is such growth is job rich or job less. Available data is contradicting each other and we are at puzzle. A leading daily said employment growth in industrial sector slowed further in fiscal year 2016-17 for the second in a row, in a sharp U turn from its previous growth record according to labour force survey by BBS.
Sluggish private investment, rise of capital intensive sector and adoption of advanced technologies are the key reasons behind the fall of employment. The industrial sector which was a major employment generator between 2000 and 2010, employed only 3 lakh people in the last seven years till 2016-17.
On average, the sector created 42,857 jobs a year during the period. In the previous seven years till 2010, it created 8.71 per cent new jobs, according to survey. As a result of this reversal, industrial sector's share of employment fell to 20.4 per cent in 2016-17, down from the highest 23 per cent recorded in 2013.
The share of agriculture in the job market also dropped. The survey found that 14 lakh new faces joined the labour force between 2015-16 and 2016-17 taking the total number to 6.35 crore. Of the total 6.08 crore have jobs while 27 lakh are fully unemployed up by 1 lakh from a year ago.
Overall unemployment rate remains steady at 4.2 per cent according to BBS. But this finding gets contradicted to the available data. Our growth is not job-friendly is yet to be proved. Yes it is fact nearly 20 lakhs labour force enter market every year. Our total investments do not cope with filling total vacancies. But ice is melting. Our growth is totally job-less we cannot say it, particularly when we see the reality.
Data says, private sector credit grew 18.49 per cent in February, up from 18.36 per cent a month earlier and way past the central bank's target of 16.3 per cent, dispelling the notion of an ongoing liquidity crisis in the banking sector. For the best part of 2017 the private sector credit growth has been on the rise, prompting the Bangladesh Bank in January this year to lower the bank's loan-deposit ratio ceiling to 83.5 per cent from 85 per cent.
So where has it gone the rising private sector credit instead of investment? That is a hundred dollar question. Or that enhanced investment finds no way of creating any employment opportunity. Or rising private sector credit finds its way otherwise other than labour intensive productive sectors. Where lies the truth?
Not only this, our planning minister informed us, manufacturing sector has done well. The provisional estimates show that the manufacturing sector grew 13.18 per cent this fiscal year and construction sector 10.11 per cent. Agriculture sector whose contribution to the GDP is 14.10 percent, grew 3.06 per cent in fiscal2017-18, up from 2.97 per cent last year.
The services sector, whose contribution to the GDP is 52.85 per cent, grew 6.33 per cent this year. Are these sectors seeing their growth without having any employment opportunity? The industrial sector whose contribution to the GDP is 33.71 per cent. The work of various mega projects including the Padma Bridge and metro-rail are advancing. Private investment to GDP ratio increased marginally from 23.1per cent in fiscal 2016-17 to 23.25 per cent in fiscal 2017-18. Gas production is projected to increase by 1.32 per cent and electricity production plus imports increased 9.4 per cent and industrial raw materials import in nominal dollars increased 8.2 per cent. Employment in manufacturing increased 2.3 in 2017, according to the latest labour force survey.
So there is a jobless growth how can we say that. Rather it might be said, job creation is not advancing in same stride commensurate with economic growth. Here lies the apex of the problem. Here lies our differences.
Writer is a freelance contributor and he can be reached at gharadhan@gmail.com
