Lessons from the Bangladesh uprising

The popular insurrection that dismissed to the Prime Minister of Bangladesh Sheikh Hasina The Awami League government already offers important lessons for the international community and for neighbouring India. While the unrest was undoubtedly fuelled by the regime’s repressive and increasingly undemocratic tactics, exemplified by its brutal crackdown on largely peaceful student protesters, the underlying causes of popular discontent are often overlooked.

The student protests initially focused on ending the labor quota system that reserved the 30% from public offices for veterans of Bangladesh’s 1971 War of Independence and their descendants. Although the Hasina government abolished all quotas through an executive order in 2018, the High Court reinstated them in June this year, leading to mass protests. A month later, the Supreme Court intervened to annular the lower court’s decision and ruled that quotas should be reduced to 5% and that 93% of public jobs should be filled on the basis of merit.

However, by then, the government’s brutal repression had already claimed the lives of More than 300 protestersamong them the student activist Abu Sayed, fuelling public outrage and calls for Hasina to resign. On 5 August, Hasina resigned and fled to India after the army would reject their demand for even tougher measures.

The sad irony is that Hasina – daughter of Bangladesh’s first president, Sheikh Mujibur Rahman – was once a student leader and pro-democracy activist against a military regime. During her four terms as prime minister, she presided over a considerable economic transformation, driven by a spectacular increase in clothing exports and significant investments in infrastructure, which also led to a sharp increase in the female employment. Over the past 20 years, poverty rates have halved and Bangladesh’s GDP per capita (in today’s US dollars) surpassed that of India in 2019. The country is on track to graduate from the “least developed country” category in 2026.

But Hasina’s authoritarian tendencies ended up overshadowing her economic achievements. execution of alleged “extremists”, along with the arrests and disappearances of lawyers, journalists and indigenous rights activists who dared to criticize the government, created a climate of fear that intensified during the 2018 election.

Following further erosion of Bangladesh’s democratic institutions, the 2024 election was a real farce. Most opposition parties boycotted the vote or effectively banned her from participating, but Hasina won a landslide majority and It was guaranteed a fourth consecutive term. Despite the government’s lack of popular legitimacy, India and other major powers quickly recognised the result.

The country’s faltering economy also played a central role in the recent uprising. Over the past ten years, growing inequality and unemploymentalong with the exorbitant rise in the price of basic commodities, have intensified public outrage at nepotism and rampant corruption. The government’s stubborn reluctance to confront or even acknowledge these issues further aggravated popular sentiment.

A key lesson from Bangladesh’s experience is that rapid GDP growth and strong exports alone cannot guarantee widespread prosperity. When the benefits of economic growth are concentrated at the top of the pyramid, most citizens see little improvement or are even worse off, frustrating their rising expectations and underscoring the need for a fairer distribution of wealth and income.

Another crucial lesson is that jobs matter. Creating jobs is important, especially for young people, but ensuring fair wages and decent working conditions is also important. When most people’s incomes stagnate or decline, people tend to lose faith in the official discourse of economic dynamism.

Indian Prime Minister Narendra Modi’s government would do well to learn these lessons, given India’s glaring inequalities in income, wealth and opportunity. But Bangladesh should also serve as a warning sign to international organizations and outside observers, who are often overly influenced by aggregate growth figures and openness to foreign investment.

Analysts often overlook the role that the International Monetary Fund has played in Bangladesh’s recent economic woes. In 2023, Bangladesh will obtained a $4.7 billion bailout from the IMF, a measure that, For some observers, it was unnecessary. These funds were originally intended to bolster the country’s foreign currency reserves, which had been depleted by the COVID-19 crisis and the global rise in food and fuel prices. But the conditions associated with the IMF loan, which included a Greater exchange rate flexibilitycaused a marked depreciation of the Bangladeshi taka and the introduction of a new pricing policy for petroleum products, which ended up triggering a rise in domestic inflation.

The IMF also demanded that Bangladesh reduce its budget deficitwhich led to a fiscal cut that affected essential public services, including critical social programs. Meanwhile, the central bank tightened monetary policy and raised interest rates to curb inflation, putting enormous pressure on small and medium-sized businesses and worsening the employment crisis. In June, the IMF approved The third tranche of the loan, totaling $1.2 billion, is imposed 33 new conditions that Bangladesh must meet to receive the remaining disbursements.

While these measures are supposedly intended to improve economic “efficiency” and boost investor confidence, history suggests that such outcomes are highly unlikely. On the contrary, the austerity policies advocated by the IMF have fueled economic insecurity and popular anger across the developing world. The mass protests and political instability that have affected countries such as Kenya, Nigeria and Ghana – which have implemented IMF programs – underscore the urgent need for the Fund to reconsider its approach.

But the fundamental political lesson here is that authoritarian leaders like Hasina are not invincible. They can suppress democratic protests, muzzle the media, undermine independent institutions and try to rein in the judiciary, but they cannot stay in power indefinitely. Indeed, the more ruthless these regimes become, the more they risk a popular backlash.

Hasina’s downfall should therefore serve as a warning to Modi, a close ally with authoritarian tendencies of their own. Global leaders should also take note: the long-term costs of aligning themselves with undemocratic regimes in exchange for geopolitical gain often outweigh the short-term benefits.

© Project Syndicate, 2024

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