Poverty Trends in Bangladesh

Course Title: Sociology of Bangladesh

Course No.: 4207
 Prepared By
Md. Saeed Anwar and Babla Golder
Sociology Discipline
Khulna University
Khulna, Bangladesh
 Introduction
Bangladesh is one of the most densely populated as
well as the eighth largest country in the world with a
population of 149.77 million (BBS, 2011).
Almost half of its people live on less than US$1.25 a
day and 80% on less than US$2.00 a day (DFID,
2005).
Around 35% of the population of six major cities in
Bangladesh lives in slums and it covers only 4% of the
land area with limited or no access to services (World
Bank, 2007).
By 2000 this figure came down to 49 percent. Over
the period 2000 to 2005, the poverty rate further
declined to 40 percent with around six million people
lifted out of poverty (GOB, 2011).
 Poverty: Definitions
Poverty is pronounced deprivation in well-being, and
comprises many dimensions. It includes low incomes
and the inability to acquire the basic goods and services
necessary for survival with dignity (IMF, 2005).
Jary and Jary (2004) defined poverty as, “the lack of
sufficient material and cultural resources to sustain a
healthy existence”
Poverty is “a condition characterized by severe deprivation
of basic human needs, including food, safe drinking
water, sanitation facilities, health, shelter, education and
information. It depends not only on income but also on
access to services” (UN, 1995).
 An Overview of Poverty in Bangladesh
Bangladesh is one of the world’s poorest countries. With the
help of international assistance, there has been a declining
trend of poverty by 1% each year since 1990s (DFID, 2005).
However, they are unable to escape from extreme poverty, as
the data from World Bank found that there is still 40% of the
population to be below the national poverty line in 2005.
The population in Bangladesh is predominantly rural, with
almost 80% of the population living in the rural areas. Many
of them live in remote areas that lack services such as
education, health clinics and adequate roads, particularly
road links to markets.
They suffer from persistent food insecurity, own no land and
assets, are often uneducated and may also suffer serious
illnesses or disabilities (Baker and Schuler, 2004).
 An Overview of Poverty in Bangladesh
 The incidence of Poverty in Bangladesh is one of
the highest in the world. Millions of people suffer
from the hardship of poverty.
About one-third (31.5 percent) of its population
is living below the poverty line (HIES, 2010).
Furthermore, the recent spikes in food prices,
causing food inflation, have impact on poverty
which may plunge an additional population of
0.04 million under the poverty line(Unnayan
Onneshan, 2011).
 Population under Poverty Line
 The number of population living under poverty line is still
increasing. The number of population living below the
poverty line has increased from 51.6 million in 1991-92 to
56 million in at national level (HIES, 2005).
 If the current trend continues, the number of population
living below the poverty line might stand at 57.3 million
and 59.8 million by 2013 and 2021 respectively.
 However, in rural areas, it might decrease to 40.2 and 38.1
million by 2013 and 2021 respectively.
 Whereas, in urban areas, it might witness an increased
population of 17.1 and 21.7 million by 2013 and 2021
respectively living under the poverty line in urban areas
(Unnayan Onneshan, 2011).
Factors Affecting Poverty in Bangladesh Characteristics
Unnayan Onneshan, 2011 identified some factors affecting poverty in
Bangladesh which are identified below:
1. Food Inflation and Population under Poverty Line: Food
expenditure, food inflation and general inflation are positively
associated with poverty and inequality. In 2000, 55.8 million people
were living under poverty line while food inflation was 2.68 percent.
After five years, food inflation has increased to 7.91 percent in 2005
when the number of total population living below the poverty line
was 56 million.
2. Household Income and Expenditure: During the period of 1995-96
to 2010, the monthly household income has increased with rates of
10.86 percent, 10.92 percent and 7.10 percent at national, rural and
urban regions respectively. At the same time, the monthly household
expenditure has also risen with the rates of 11.58 percent, 11.78
percent and 7.57 percent while expenditure on food has increased
with the rates of 10.64 percent, 10.63 percent and 8.32 percent at
national, rural and urban areas respectively.
 Factors Affecting Poverty in Bangladesh Characteristics
3. Unequal Growth and Poverty: In Bangladesh, the
number of people living in poverty has increased
due to rising disparities in the distribution of
resources within this country. Unequal growth
pattern has a weaker poverty alleviating effect and
has been shown to be harmful to growth.
4. Income Inequality: Gini co-efficient of income has
increased from 0.393 in 2000 to 0.430 in 2010 at
rural areas with the growth rate of 0.94 percent,
whereas it has decreased from 0.497 to 0.452 at the
same time period in urban areas with the growth
rate of -0.91 percent. Gini co-efficient of income
has increased from 0.451 to 0.458 at national level
with a growth rate of 0.16 percent during the same
period.
 Poverty Trends in Bangladesh
Bangladesh has made strides in the fight against poverty during the last two decades.
Poverty is measured by different methods; but the Cost of Basic Needs (CBN)
method. Some terms are used to mention the poverty trends which are given below:
 CBN (Cost of Basic Needs): Which means the cost of basic needs method is using
as the standard method for estimating the incidence of poverty since 1995-96 in
Bangladesh Bureau of Statistics.
 Lower Poverty Line: Which means the extreme poor households are those
households whose total expenditures on food and nonfood combined are equal to or
less than the food poverty line.
 Upper Poverty Line: Which is estimated by adding together the food and nonfood
poverty lines. The moderate poor households are those households whose total
expenditures are equal to or less than the upper poverty.
 The Head Count Rate (HCR) of poverty: Which provides the estimate of the
percentage of people living below the poverty line as a share of total population.
 The Poverty Gap (PG): Which estimates the depth of poverty of the population.
 The Squared Poverty Gap (SPG): Which measures the severity of the poverty.
Trends in Head Count Rates of Poverty, 1991-92 to 2010

Source: Bangladesh Bureau of Statistics, Various HES/HIES

From the table above it can be depicts that in both

national and rural areas head count rates of poverty
gradually decreased from 1991-92 to 2010 in both
upper and lower poverty line. But, unlike rural and
national in the urban areas poverty line also
decreased with and exception in 1995-96.
 Trends in Headcount Poverty Rate (%) in
Accidence with Five Year Plans

Even in accidence with five year plans in both national

and rural areas head count rates of poverty gradually
decreased from FY-74 to FY-10 in both upper and
lower poverty line. But, unlike rural and national in
the urban areas poverty line also decreased with and
exception in FY-96.
 Trends in Depth and Severity of Poverty in Bangladesh
Year 1991-92 1995-96 2000 2005 2010
Poverty Gap (%)
National 17.2 13.3 12.9 9.0 6.5
Rural 18.1 14.5 13.8 9.8 7.4
Urban 12.0 7.2 9.5 6.5 4.3
Squared Poverty Gap (%)
National 6.8 4.8 4.6 2.9 9.0
Rural 7.2 5.3 4.9 3.1 2.2
Urban 4.4 2.5 3.4 2.1 1.3
Source: Bangladesh Bureau of Statistics, Various HES/HIES
As like as head count rates of poverty in both national and
rural areas poverty gap and squared poverty gap gradually
also decreased from 1991-92 to 2010 in both upper and
lower poverty line. But, unlike rural and national in the
urban areas poverty gap and squared poverty gap also
decreased with and exception in 1995-96.
 Trends in poverty (head count rate), CBN
method, by division (2005-2010)

Source: Bangladesh Bureau of Statistics, Various HES/HIES

 Trends in poverty (head count rate), CBN
method, by division (1995-2005)

Source: Bangladesh Bureau of Statistics, Various HES/HIES

 Trends in Poverty and Squared Poverty Gap,
by division

Source: Bangladesh Bureau of Statistics, Various HES/HIES

 Household Monthly Income, Expenditure and
Food Expenditure
Years of Survey

Household Monthly Household Monthly Household Monthly Food

Income Expenditure Expenditure

National Rural Urban National Rural Urban National Rural Urban

2010 11479 9648 16475 11200 9612 15531 6031 5543 7362

2005 7203 6095 10463 6134 5319 8533 3209 3023 3756

2000 5842 4816 9878 4881 4257 7337 2477 2300 3175

1995-
4366 3658 7973 4096 3473 7274 2323 2137 3276
96

Source: Bangladesh Bureau of Statistics, Various HES/HIES

 Trends in Income Inequality of Bangladesh
Income Inequality/Year 2000 2005 2010
National 0.451 0.467 0.458
Urban 0.497 0.497 0.452
Rural 0.393 0.428 0.431
Source: Bangladesh Bureau of Statistics , Different HIES

The Gini co-efficient is the most popular composite indicator that

summarizes the extent of concentration (inequality) of household income.
Gini co-efficient of income has increased from 0.393 in 2000 to 0.430 in
2010 at rural areas with the growth rate of 0.94 percent, whereas it has
decreased from 0.497 to 0.452 at the same period in urban areas with the
growth rate of -0.91 percent. Gini co-efficient of income has increased
from 0.451 to 0.458 at national level and the growth rate is 0.16 percent
during the same period. The Gini co-efficient of income has decreased at
national and urban level over the last five years (2005 to 2010) while it has
slightly increased in rural areas during the same time.
 Causes of High Poverty Rate in Bangladesh
The Daily Star, 2006) also indentified some causes of high poverty
rates in Bangladesh:
 Overpopulation: Overpopulation is defined as the situation of
having large numbers of people with too few resources and too
little space. Poverty can also depend on the country's mix of
population density and agriculture productivity.
 High birth rates: High birth rates contribute to
overpopulation in many developing countries. Children are
assets to many poor families because they provide labor,
usually for farming. Cultural norms in traditionally rural
societies commonly sanction the value of large families.
 Illiteracy and lack of Education :Illiteracy and lack of
education is common feature of our rural area. Most of the
rural people are unable to read and write as a result they are
not conscious about modern technology which is very
necessary for more production in agriculture.
 Causes of High Poverty Rate in Bangladesh
 Sessional Unemployment: Periodic unemployment created by
seasonal variations in particular farming which are affected by
the weather. As a result the rural people have no work in half of
the year like Monga area people of Bangladesh.
 Low Wage: In the rural area comparatively the rate of wage is
low than urban. A labor can earn about 2000-3000 per month
which is not sufficient for a rural family. At present price hike is
a serious problem and the rural poor are the victims.
 Natural Disaster: Natural disaster is the common picture of our
country. Every year our country is affected by the natural
disaster. The rural farmers are more affected by the natural
disaster like river erosion, cyclone, tidal surge, excessive rain
and others.
 Death of Chief Wage-earner: Most of the families are one man
dependent or wage earner becomes single so when he/she died
the family face severe economic problem and at last fall into
poverty.
 Causes of High Poverty Rate in Bangladesh
 Largeness of Family: Though birth rate is high in rural area
than urban so the size of family is large in rural area. Through
the sufficient income it is quit impossible to lead a family with
6-7 members. It is one of the major causes of rural poverty.
 Dowry: Dowry is a social problem and it is severe in rural area.
Especially among the rural poor it is curse. Due to dowry
process sometime it needs to sell the property as a result they
lost their source of income.
 Illness and Injury: Anyone can be affected by illness and injury
and if he/she becomes the earning member of the family it will
very harmful for the family especially for the rural poor family.
And it is very common feature of rural poor because they have
less access of medical facilities.
 Debt: Debt is curse for rural poor people because they take
debt from rural Mahajon or rich person with high interest.
When they are unable to pay the debt, the interest of it rises
day by day and at a time the amount become double or more
and as result they are bound to sell their property.
 Causes of High Poverty Rate in Bangladesh
 Crop Damage: Every year due to natural disaster the agriculture of rural
area are hampered very much. Every year their crops are damaged by the
natural disaster or others which are the important cause of rural poverty.
 Lack of Land: In our country about 20% people are the owner of 80%
land and 80% people hold only 20% land. Most of the poor have no
personal land. They cultivate others land with share but they are
deprived from their part of profit.
 Price Rise of Agricultural Instruments: The continuous and steep price
rise of agricultural instruments has added to the miseries of poor.
 Low Productivity in Agriculture: The level of productivity in
agriculture is low due to subdivided and fragmented holdings, lack of
capital, use of traditional methods of cultivation, illiteracy etc in our
country.
 Shortage of Capital and able Entrepreneurship: Capital and able
entrepreneurship have important role in accelerating the growth. But
these are in short supply making it difficult to increase production
significantly in our rural area as a results they are unable to produce good
production in agriculture.
 Causes of Poverty Reducing at a Slower Rate
in Bangladesh
 Social Relationship: Poverty is a part of social relationship. The
poor are remaining poor due to the structural reasons. People
belonging to the lower class of the society are not allowed to be
associated with the upper class in anyway. Hence, even if income
poverty scenario may be changed, social poverty remains
unchanged due the structural reasons (Unnayan Onneshan, 2011).
 Deficiency of Equalizing Income Augmenting Employment
System: The growth process in Bangladesh has not been matched
with increases in jobs. Moreover, the people have entered into
labor market with wages below the poverty, creating a huge
amount of people, who can be termed as “working poor.”
Furthermore, a huge chunk of employed population is under-
employed (Unnayan Onneshan, 2011).
 Traditional Agriculture: Bangladesh is a agriculture dependent
country and about 80% of rural population are closely related with
agriculture but they have very few knowledge about modern
technology which is used for more production (Unnayan
Onneshan, 2011).
 Causes of Poverty Reducing at a Slower Rate in
Bangladesh
 Shortfalls in Public Expenditure for Capabilities Enhancements:
The public expenditure in in education, health and housing
capabilities has always been less than the required level which has a
bearing on the poverty (Unnayan Onneshan, 2011).
 Inadequacies in Regulatory Regimes: The system of accumulation
in Bangladesh is principally primitive in nature. Such accumulation
is omnipresent, particularly in cases of access to, and control over,
natural resources, common property resources, and subsidies of
state resources. The bias created in favor of rich and powerful could
be somewhat lessened by regulatory regimes, giving access to and
control over, such resources to the poor (Unnayan Onneshan, 2011).
 Policy Incoherence and Lack of Complementarity: Poverty may
also increase due to the lack of maintaining coherence and/or
complementarity in policies and implementation. For example, the
tax system of the country is regressive and bias in favor of rich.
While the inflation is cropping up, there are not adequate policies to
offset the income erosion of the poor (Unnayan Onneshan, 2011).
 Causes of Poverty Reducing at a Slower Rate
in Bangladesh
 Ensuring Constitutional Obligation : The Constitution of the
country pledges to ensure basic necessities to its citizens by the state.
Since these rights are not legally enforceable, it remains difficult for
the poor to enjoy the basic necessities and graduate out of poverty.
 Expanding Population, Failing to Harness Population Dividend:
Excessively high population densities put stress on available
resources. However, the bulk of the population is of working age,
which provides an ample opportunity to harness population dividend
(Unnayan Onneshan, 2011).
 Environmental Degradation and Climate Change: Environmental
degradation the deterioration of the natural environment, including
the atmosphere, bodies of water, soil, and forests is an important
cause of poverty. Environmental problems have led to shortages of
food, clean water, materials for shelter, and other essential resources
(Unnayan Onneshan, 2011).
 Conclusion
The eradication of poverty and inequality and meeting
of basic needs are the primary goals of the government.
The present government of Bangladesh is very much
hopeful in achieving the target of Millennium
Development Goals (MDGs) as well as the targets of
Vision-2021 related to poverty and inequality.
Although Bangladesh has achieved progress in poverty
reduction, there is widespread poverty at the national
and regional levels and there are variations in poverty
levels between rural and urban Bangladesh.
So, NGOs and other welfare organizations must come
beside the government to reduce both rural and urban
poverty from the country finding out sources of foreign
grants and aid as well as multidisciplinary action
planning.
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Thank
You