Poverty in Bangladesh: Innovations Against Exploitation

November 10, 2012
For decades, poverty in Bangladesh was more concentrated than any other place in the world. What does it mean? Simply that the country has one of the highest percentage of poor people per square mile.

With about 150 million inhabitants, 80% of whom are rurals and poverty rates over 40%, it shows that agriculture is really a vital sector to the country. Of the whole rural population, almost half of them are considered landless (own less than half an acre of land).

An exploited population

The core of the problem with poverty in Bangladesh remains the way the society is organized. To be more specific, the society is organized in classes so that an elite class dominates the others and exploits them.

Most of what is produced goes directly into the hands of this elite and the harvest from agriculture itself is far from miraculous: the whole infrastructure and techniques are far too underdeveloped. Extreme poverty in Bangladesh is such a problem that any minor change in food prices or weather (storm) can threaten the lives of millions of people.

In this setting, it’s no wonder that this country has seen the birth of one of the most innovative anti-poverty strategy: microfinance, thanks to Nobel prize Muhammad Yunus. Now let’s try to understand the different problems and solutions that have had an impact on poverty in Bangladesh.

Early anti-poverty programs

‍Anti-poverty programs in rural Bangladesh
‍ ‍Anti-poverty programs in rural Bangladesh

Poverty in Bangladesh… A lost war ?

Quite a lot of programs have been tried since the independence of Bangladesh in 1971, and to tell the truth, most have failed. To many experts, it makes no doubt that this is because no program has tried to change the status quo concerning the excessive power of a few landlords over the majority of the population.

Obviously, each time an anti-poverty program fails it gives more fuel to the richer class to argue that there’s no point trying to help the poor. But the truth is that each program was doomed from the beginning because it could only have so much impact on the social inequalities in Bangladesh.

Trying the liberal approach

There was a change in the 1990s in the way big organizations such as the International Monetary Fund (IMF) and the World Bank tried to help developing countries. In fact this change happened worldwide, including in developed countries and the way they ran the nation. This change was (and still is) led by a neo-liberal doctrine that says that the state isn’t efficient enough in delivering services or humanitarian aid. Which is true, to some extent. Therefore, the idea was to rely uniquely on the market (private companies) as well as NGOs to help develop the country’s economy.

Considering the massive corruption and lack of interest from the political class in tackling poverty in Bangladesh, it did sound like a good idea at the time. Not that it created a catastrophe at all, but as NGOs become the main channel for delivering aid and did reach millions more people than the State ever could, it also became obvious that their impact was very limited.

What to do then?

The problem with NGOs is that, just like any state, they have been unable to reach enough people and they often proved just as inefficient as the state in delivering aid. On top of that, there has been a massive lack of cooperation between the state and NGOs to help the local population, in particular rural Bangladeshis.

The interest in NGOs from big donors proves an obstacle to real change: the reform of the state. What over 100 years of development has shown is that most countries that are today considered developed have managed to do so by massively investing in infrastructure and in creating an economy (e.g. protect burgeoning industries). 

In the case of poverty in Bangladesh, it’s clear that the current government won’t and can’t bring the change that is needed. NGOs work great when delivering emergency relief and aid, and when working in coordination with local governments. But they can’t lay the tracks for an entire country to grow an economy and sound institutions that protect and serve its citizens.

Causes of poverty in Bangladesh

‍What is the place of women in anti-poverty programs in Bangladesh?
‍ ‍What is the place of women in anti-poverty programs in Bangladesh?

Factors contributing to poverty

A study over 15 years has shown that there is a huge variety of factors that influence poverty. Better education, having more land, a better job (not so common it seems), but also the size of the family and where people lived all affected their level of poverty and how much they consumed.

Where families were small and women allowed to work or go to school, families were substantially less poor than others. In fact education proved to matter just as much as land ownership in reducing inequalities and improving income both in urban and rural Bangladesh.

Poor areas and poor people

Research comparing regional poverty in Bangladesh is compelling: poor areas aren’t poor because of the people who live there. Poverty is also a geographical problem: these areas are poor because they provide much less schools on average, much less roads and connected villages and towns and much less infrastructure in general.

This worsens the life of the poor as it makes it much harder for them to meet their basic needs, sell their crops, find decent housing and send their kids to school. So, any sound anti-poverty program can’t neglect the importance of addressing geographic poverty and improve local infrastructure as well as provide training for the locals.

Child labor in Bangladesh

‍Exploitation and child labor in Bangladesh
‍ ‍Exploitation and child labor in Bangladesh

A major cause of poverty in Bangladesh

Child labor is a growing problem in many countries that affects hundreds of millions of children. In Bangladesh, the problem concerns above 6 million kids – nearly 15% of the children in the country. Unfortunately, children also represent a huge share of the country’s workforce, thus creating a vicious economic dependency on child labor.

This situation denies these kids their right to education and often leaves them with diseases caught at work – occupational hazards that will often follow them for life. As the country depends so much on agriculture, child labor fuels mostly the need for more “men” in the fields. But the situation has now diversified and Bangladeshi kids get the chance to work in all kinds of settings: factories (cigarette, biscuits, salt processing), as well as in textile and housework.

Causes of child labor

It goes without saying that poverty is the main cause of child labor in Bangladesh, and that parents would be happy to send their kids to school (or to the playground) if they could afford to. But it’s not just a matter of money; in rural Bangladesh primary schools are not that easy to find either.

Some parents also believe that sending girls to school is just wrong, some others aren’t aware of the consequences of child labor: life-long diseases, lack of skills for life and brain development issues to name just a few. Parents aren’t the only culprits either. There are clear labor laws against child labor in Bangladesh, but they’re completely ignored by employers who are happy to hire cheap labor (in case you were wondering, kids cost less than adults). Better invest in laws against exploitation and poverty in Bangladesh.

Child labor statistics – How bad is it?

Boys are more concerned with child labor and make up almost 60% of child workers. On average their age is between 12-14 years old and “luckily” not so many of them work in health-threatening factories. The biggest proportion of child workers are found in fields and almost half of them will never go to school.

Child labor represents a real income that is essential to the survival of many families, so banning it is definitely not the solution. The only way to end it is to reduce poverty and educate the parents on the benefits of education for their kids. If child labor is to become a crime, then the government has to think of ways to help families that need the extra income to meet their basic needs in terms of food and clothing.

There is also the risk that if kicked out of proper factories and “real jobs”, kids will end up working in much riskier and/or degrading jobs, from prostitution to crime. Finally, schools and education programs need a good revamp too as their diplomas hardly help people finding a job (except maybe in trade). Sending your kids to school so that they can become unemployed doesn’t sound like a good trade-off to many parents.

New tools to fight poverty today

Improving access to basic services
‍Improving access to basic services

The role of technology

The adoption of technology can change things radically and very quickly. In a way, it’s also been the cause of more inequalities. Villages that were the early adopters of modern agriculture with better machines and seeds saw their income improve so fast that it created huge wealth inequalities with other villages.

Therefore, to avoid future tensions and disparities within the population, it’s also the government’s role to make sure that everyone can have easy or affordable access to these new technologies. Spreading technology in agriculture is an essential part of reducing poverty in Bangladesh and will help improve average living standards in the country.

Also, it’s important that NGOs and the government keep on providing training to local farmers so that they can figure out the most sustainable and productive way to manage their crops. Obviously, focusing on pseudo-modern techniques such as intensive agriculture on a unique crop proves neither sustainable not that efficient. In general a mix of rice, wheat but also some fruits and vegetables is best for the soil to remain rich and more productive – as intensive agriculture tends to exhaust it and lead to erosion.

The Ganokendra – A new tool

A Ganokendra is a sort of community center dedicated to lifelong education, training and poverty reduction. It has a particular focus on women and empowering people suffering from exclusion (again, women).

It’s one of the new tools created to help Bangladesh meet the Millennium Development Goals (UN targets of ending global poverty). Investing in human capital is indeed the new focus of many anti-poverty strategies, and as such the case of women shows a massive waste of potential. In fact, women not only suffer most from poverty in Bangladesh (child marriage, sexual violence), they’re also abused and neglected on a regular basis.

So how helpful are Ganokendras? These centers provide everything from accommodation to training courses and financial support. And they have indeed been quite successful; precisely because they aim at offering lifelong skills: reading, counting, earning a living, dealing with legal problems (e.g. local government) or family crises.

The success of Ganokendras

They make people aware of services provided by the government and of their rights as citizens. The success of these community centers is also due to the huge resources they have in terms of reading material that make learning entertaining and packed with useful information (health, culture, society, human rights, environment, etc). In areas where Ganokendras where available, the results where unmatched by any other development strategy: 100% of kids were going to primary school regularly and all members of the community centers without exception made correct use of basic hygiene.

On top of that, women got better understanding of the importance of contraception and family planning to prevent unwanted pregnancies. Teaching parents how to read also sparked a new enthusiasm for education – in both adults and children – which also contributed to successful micro-credit programs where very small loans were given to poor farmers. Obviously, it’s easier to give back the money you owe (and deal with your own finances) when you know how to count.

There are still many aspects to improve in terms of managing these centers, providing them with enough resources, trained staff and accommodation; but on the whole it looks like a successful experience to be replicated elsewhere or taken to a larger scale.

Muhammad Yunus - Micro-credit & poverty in Bangladesh

“Credit is a human right”, once declared Muhammad Yunus, founder of the Grameen bank and inventor of micro-credit. What is micro-credit? It consists in lending money to the very poor, who are otherwise considered not viable by traditional banks.

The loans are usually very small but do make a difference to the bottom poor. Alternatively, these loans are also made considering an entire group as the borrower, so that everyone is responsible and hopefully the money benefits an entire community, generating new employment opportunities. In that sense, micro-credit is finally filling the gap created by the failure of traditional banks. Impossible of access to finance has long been one of the greatest causes of exclusion that contribute to poverty in Bangladesh.

Micro-credit has also changed the rules of the game by offering much simpler application procedures (most of the poor can’t read anyway) and stopped the age-old habit of charging insanely high interest rates. Making people become massively indebted is one of the oldest ways to create slavery and/or exploitation (“you owe me so much that you have to work for me your whole life”).

Today, micro-finance has become one of the most popular anti-poverty programs but many organizations forget about the importance to measure the impact and make sure that targets are met. Otherwise, there is a risk that funding for this type of strategy will wane as results do. The experience of fighting poverty in Bangladesh and other countries has indeed shown that some communities indeed see their lives improve a lot more, but that others also struggle with their additional debt and only become poorer. Therefore, micro-finance now needs a re-assessment to keep the best programs only and avoid aggravating the situation.


  • Header photo courtesy of Sudipta Arka Das
  • Ganokendra: An Innovative Model for Poverty Alleviation in Bangladesh, Kazi Rafiqul Alam, International Review of Education 2006
  • The Impact of Micro-Credit on Poverty: Evidence from Bangladesh, J. A. Chowdhury et al., Progress in Development Studies 2005
  • Dancing with the Rivers, Gilles Saussier, People & Places / UNESCO Courrier 1999
  • Changing Fortunes in Anti-Poverty Programmes in Bangladesh, M. M. Ahmad and J. G. Townsend, Journal of International Development 1998
  • Child Labor in Bangladesh: A Critical Appraisal of Harkin's BiU and the MOU-Type Schooling Program, Mohammad Mafizur Rahman et al., Journal of Economic Issues 1999
  • Microdeterminants of Consumption, Poverty, Growth, and Inequality in Bangladesh, Q. T. Wodon, Applied Economics 2000
  • Food Energy Intake & Cost of Basic Needs: Measuring Poverty in Bangladesh, Q. T. Wodon, Journal of Development Studies 1997
  • Income Distribution and Poverty in Bangladesh Agriculture, S. Rahman, Journal of International Development 1999
  • When Method Matters: Monitoring Poverty in Bangladesh, M. Ravaillon, B. Sen, Economic Development and Cultural Change 1996
  • From the Land of Plenty to "the World's Basket Case", Denise Duclaux, ABA Banking Journal 1996
  • Poor Areas or Only Poor People?, M. Ravaillon, Q. T. Wodon, Journal of Regional Science, 1999

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Dario Berrebi

Digital strategist, researcher & filmmaker. 

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