Half of non-poor in country risk slipping into poverty

Nearly half of the non-poor households in Bangladesh remained vulnerable to falling back into poverty, a latest economic-situation analysis by the World Bank stated at a Dhaka meet Saturday.

“Half of the non-poor Bangladeshis in rural areas face the risk of falling into poverty compared to one in three in urban areas in Bangladesh,” said WB senior economist Mr Sergio Olivieri.

MR Olivieri was presenting a keynote on ‘Households are Vulnerable to Falling into Poverty in Bangladesh’ in a session of the Annual BIDS (Bangladesh Institute of Development Studies) Conference on Development.

Chaired by World Bank country director in Bangladesh Abdoulaye Seck, the session was addressed, among others, by WB senior economist Dhruv Sharma, Nethra Palaniswami and Ayago Wambile.

According to the HIES 2022 report of BBS, Bangladesh’s poverty is recorded at 18.7 per cent. The 20.5 per cent in rural and 14.7 per cent in urban areas are still below the poverty line.

Dhruv Sharma said if the country failed to rein in the inflation and take some pragmatic policy reforms, more people would fall into poverty.

“Although the central bank has tightened monitory policy, a better supply-chain management is imperative.”

Mr Olivieri said rural areas in Bangladesh improved their vulnerability level between 2010 and 2022, while urban areas deteriorated.

“Extreme vulnerability fell faster in rural areas but remained above urban levels of a decade ago. Four out of 5 extreme vulnerable people live in rural areas,” he added.

The WB economist has suggested investing more in education, enhancing access time to market, expanding insurance, access to credits, and boosting safety net etc.

Dhruv Sharma said Bangladesh investment is weak as there is liquidity crisis, high interest rate and fragile foreign -exchange reserves.

He thinks the country is likely to grow at a slower 4.0-percent rate in the current fiscal due to the existing economic shocks.

Ms Nethra said the food poverty line in Bangladesh should be updated as the basic consumption basket consists of 11 items with a minimum nutrition requirement of 2122 Kcal per person.

“This bundle only captured about 42 per cent of total food expenditure of the bottom 20-percent population,” she said.

She suggests reflecting current consumption behaviour of the reference group, and current standard of living, greater dietary diversity, and increased urbanization in the poverty-measurement method.

Meanwhile, Professor Geof Wood of the University of Bath, UK, told the meet that although Bangladesh is a development model, but there is fragility in political settlement here.

This has made the democracy vulnerable here in Bangladesh, he said while speaking on ‘Keeping democracy alive in Bangladesh or anywhere’ in another session of the BIDS annual conference.

The 4-day BIDS conference launched on Saturday and will end in Dec 10.

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