The New Nation - Internet Edition

Mohammed Nawazish

Our pundits continue to harangue on poverty alleviation, economic growth, business expansion, privatization, tariff and tax and a myriad of juicy economic jargons most of which we, the commoners, fail to peel off to make out the inner meaning. Bernard Shaw was perhaps right saying that if all economists were laid end to end, they would not reach a conclusion. Fact is, over years we have been noticing that despite some tangible economic growth leading to development, the fate of the vast majority of people continue to remain stuck at the cesspool of poverty and backwardness though a different picture should have been expected in the changing situation, This is an enigma we fail to resolve in our average intellect

We generally know that economic growth can occur in two ways - an increase in real GDP and an increase in real GDP per capita. Growth is an important aspect of national economy as it means more material abundance and ability to meet the economizing problem. We can't expect growth all by itself, there are four supply factors that allow an economy to grow - the quantity and quality of natural resources, the quantity and quality of human resources, the supply or stock of capital goods and, technology. Added to it, some additional factors contribute towards growth sustenance, such as, the aggregate demand must increase for production to expand, full employment of resources and both productive and allocative efficiency, stability in government and, economies of scale, that is, industries that have lower average total costs with increasing total output

To be true, actual knowledge about what creates growth is yet largely unproven. However, recent advances in econometrics and more accurate measurements in many countries is creating new knowledge to determine the variables and probable causes out of merely correlational statistics. Recent theories revolve around questions about what variables or inputs correlate or affect economic growth the most - elementary, secondary, or higher education, government policy stability, low tariffs, fair court systems, available infrastructure, availability of medical care, prenatal care and clean water, ease of entry and exit into trade, and equality of income distribution, and how to advise governments about macroeconomic policies. Education enables countries to adapt the latest technology and creates an environment for new innovations. The cause of limited growth and divergence in economic growth lie in the high rate of acceleration of technological change by a number of developed countries. These countries' acceleration of technology was due to increased incentive structures for mass education which in turn created a framework for the population to create and adapt new innovations and methods. More importantly, the content of their education was composed of secular schooling that resulted in higher productivity levels and modern economic growth.

This being the scenario of growth conundrum, where exactly do we stand in the development juke-box? With a paltry per capita monthly income of taka 1485.00 and per household monthly expenditure of taka 6134.00, we barely make both ends meet in a constant and vicious struggle for existence. While 47.5% of the people are engaged in agriculture, forestry and fisheries, 52.5% in various non- agricultural sectors including 3+% of unemployment Be it mentioned that 40% of the population live under the upper poverty line. In an agrarian economy the industrial sectors generally suffer from labour scarcity. These are known facts but equally known is the diverse paterns of obstacles that the entrepreneurs encounter as they proceed to float a company or instal an industrial unit Nothing moves in the normal channel and nothing gets cleared without fat grafts. No wonder, local and foreign investment is showing a downward trend in spite of government efforts. Our education system is a pointless exercise that serves no purpose in the creation of human resource in the global context Health and sanitation sectors beggar all description. Government policies vacillate indecisively and are mostly wrong than right With the basic fundamentals detailed in the preceding para pitifully flouted and ignored, it may look preposterous to talk on growth, development, expansion, brighter prospects and the like. Growth rate achieved over years continually dries up under pressure of population explosion and erratic and incoherent national policies.

Some believe that Free Market Economy leading to Globalisation may open a prospective door for us but there is strong opposition as well. We may have to give up a lot in favour of the superior economic powers and even we may be dictated on certain issues. Neither do we yet have the competitive ability to vend our products in open market But we can't get ourselves singled out as an off- tracker, rather the effects of globalisation will have to be utilised in our favour. An eminent Indian economist C. Balakrishnan writes that India has to concentrate on five important areas to follow to achieve this goal - the areas like technological entrepreneurship, new business openings for small and medium enterprises, importance of quality management, new prospects in rural areas and privatisation of financial institutions. The manufacturing of technology and management of technology are two different significant areas that can't be ignored either. We can formulate viable programmes in the above line to make the best use of free market opening and add strength to our efforts to atain stable development in real terms. It is time we remembered a part of John F. Kennedy's address to UNGA on September 25, 1961: Political sovereignty is but a mockery without the means of meeting poverty and illiteracy and disease. Self-determination is but a slogan if the future holds no hope.

( The writer is a retired senior civil servant of Bangladesh writes from Boston)