Zero poverty and everything else you need to know about Bangladesh’s new PP’41 long-term plan

Zero poverty and everything else you need to know about Bangladesh’s new PP’41 long-term plan

Bangladesh has envisioned a transformational strategy to become an advanced economy by 2041, which was coined as Vision 2041. It was a political vision led by Bangladesh’s prime minister Sheikh Hasina. Thereafter a strategic plan, Perspective Plan 2021-2041 (PP’41), was formulated under the guidance of the country’s apex policymaking body National Economic Council. The plan would go into effect from 2022.

PP’41 has been prepared to operationalize Vision 2041. It is Bangladesh’s second long-term development policy-strategy launched by the government led the country’s largest secular-progressive political party, the Awami League. PP’41 is a policy document which for the first-time roadmaps a route to become a high-income advanced country in 20 years.

Earlier, the first major long-term plan, the Perspective Plan 2010-2021 (PP’21) aimed to address poverty, inequality and human development while setting a double-digit economic growth target. Building on the challenges and successes of PP’21, Bangladeshi policymakers have already started implementing PP’41. PP’41 has 4 mid-term socio-economic plans integrated within it: 8th, 9th, 10th and 11th Five Year Plan.

2 visions within the Vision  

    1. Bangladesh will be a developed economy by 2041, with per capita income of over $12,500
    2. Poverty will become a thing of the past

Strategic goals of PP’41

The following are the strategic goals of PP’41:

    • Eradication of extreme poverty by 2031; reducing poverty to less than 3% by 2041
    • Reach upper middle-income level by 2031; high-income country by 2041
    • Industrialize with export-oriented manufacturing as a driver structural transformation
    • Paradigm shifts in agriculture to enhance productivity and ensure nutrition and food security
    • Form a service sector which can bridge the transformation of the rural agrarian economy to an industrial and digital economy
    • Mitigate the urban transition
    • Enable an efficient energy and infrastructure for a sustainable growth pathway
    • Build resilience to climate change and environmental challenges
    • Establish a knowledge hub country for a skill-based society

The vision includes sectoral strategies ranging from governance, human development, industry and trade, agriculture, energy, ICT and climate change. It also includes a macroeconomic framework which gives targets of important macro indicators.

High growth with macroeconomic stability

Bangladeshi policymakers follow a principle where macroeconomic stability is an essential prerequisite for growth. PP’41 comes at a time when Bangladesh is experiencing a growth surge spurred by strong national policies. This growth path is underpinned by prudent macroeconomic management reflected in low inflation, low fiscal deficits, a comfortable balance of payments and low internal-external public debt. This sound macroeconomic management will be a cornerstone of PP’41.

Key macroeconomic targets

Indicator 2020 Target 2031 Target 2041
GDP growth (%) 8.2 9 9.9
CPI inflation (%) 5.5 4.7 4.4
(% of GDP)
Gross investment 32.8 41.2 46.9
Gross national savings 31.3 37.2 44
Total government revenue 10.5 19.6 24.2
Total government expenditure 15.5 24.6 29.2
(growth rate in %)
Exports 5 11.7 11
Imports 5 12.1 10

Source: Planning Commission, Bangladesh

Zero poverty

PP’41’s core agenda is that growth has to be inclusive and poverty reducing. Under PP’41 by 2031 extreme poverty will be eliminated and by 2041 the incidence of poverty will be minimal (below 3%). By 2041, all citizens will be guaranteed a minimum quality of life, based on employment income for all who seek work and social protection benefits for the vulnerable population who cannot participate in the labour market owing to age and physical disabilities. Under-employment would be a thing of the past.

Poverty reduction targets (headcount %)

Indicator 2020 Target 2031 Target 2041
Extreme poverty 9.4 2.3 0.7
Poverty 18.8 7 2.6

Source: Planning Commission, Bangladesh

Harnessing the demographic dividend

PP’41 puts a strong emphasis on improving human development both as means to supporting GDP growth through a healthy and skilled labour. Specifically, the plan aspires for the following:

    • Institution of a knowledge-based economy
    • Population with 100% literacy rate
    • Universal free education for up to 12 years
    • Training institutions for all who seek to acquire job-based skills
    • Universal access to health insurance schemes
    • 100% coverage of employment-based accidental and health insurance schemes for workers
    • Ensuring medical facilities for all at affordable cost

Alignment with other long-term development plan

PP’41 coincides with the Delta Plan 2100, another long-term plan of Bangladesh which primarily focuses of issues of climate change and water management. Both the plans share 20 years of shared implementation period. More importantly, they share some common goals and expected to complement each other with synergistic effects. The Delta Plan incorporates the adoption of strong climate change and other delta-related adaptation measures to achieve higher and sustainable growth trajectories in the face of the various climate-related hazards and risks.