INDEPENDENT UNIVERSITY, BANGLADESH (IUB)

Assignment on

Income per Capita Along with Comparison of another SAARC Country

Supervised by:
Dr. REZAI KARIM KHONDKER
School of Business
Independent University, Bangladesh

Prepared by:
Md. Mejbahul Ali
ID: 2022896
Course: MBA510
School of Business
Independent University, Bangladesh

Submission Date: 4th January, 2020

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Contents
Introduction..................................................................................................................................................3

Objective......................................................................................................................................................4

Income Per Capita of Bangladesh................................................................................................................4

Income Per Capita of India..........................................................................................................................5

Bangladesh GDP Comparison with India:...................................................................................................6

Conclusion...................................................................................................................................................8

References....................................................................................................................................................9

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Introduction

Per capita is a common calculation used in economics, business and statistics to determine
various measurements as they relate to individuals in a population. This term is used in
several different settings and can provide different information depending on how it's used.

Calculating per capita entails taking into account a measurement or number amount by which
you will then divide by the total population of the group wishing to be analyzed. The
following formula can be used to determine the per capita:

Per capita = measurement/number of people in a population

In economic analysis, per capita is used as an apples to apples comparison between countries,
as all countries have different populations.

In this topics we will discuss about Bangladesh last 5 years Income per capita and will
compare with India income per capita

Take the following steps to calculate the per capita of a particular situation:

1. Determine the number that correlates with what I am trying to calculate,

For example, if i want to know how many people have red hair per every X amount of people
in a certain population, I would first determine the total number of people with red hair in that
population.

2. Determine how many people are in the population that I want to measure

This number will be the total amount of individuals in the group that I am measuring. For
example, if I want to measure how many people have Red hair in my neighborhood, I would
need to find out the total number of people who live in my neighborhood.

3. Divide the measurement by the total number of people in the population

So, if four people have Red hair in a neighborhood of 250 people, this would give me the
following formula: 4/250 = 0.016.

4. For smaller measurements, multiply the total by 100,000

So, using the above example, I would take 0.016 and multiply it by 100,000. This would give
me 1,600. As a result, I could say that 1,600 people have Red hair per every 100,000 people
in my neighborhood.

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Objective

The goal of this review is to know the Bangladesh GDP and Income per capita. It can help us
to check out the overall condition of the Bangladesh Economy. The goals of the analysis
receive below,

 Know about the Bangladesh Economy

 To know about the Bangladesh GDP and Income per capita
 Know about the Bangladesh past Economy Condition
 Comparing Bangladesh economy with another SAARC country IPC so we that
we can understand Bangladesh economy progress.

Income Per Capita of Bangladesh:

Bangladesh GDP Per Capita reached 1,970 USD in Jun 2020, compared with 1828 USD in
Jun 2019. GDP per Capita is in annual frequency, ending in June of each year.

In the latest reports, Bangladesh GDP expanded 5.240 % in Jun 2020. Bangladesh Nominal
GDP reached 329.804 USD in Jun 2020. Its GDP deflator (implicit price deflator) increased
4.510 % in Jun 2020. Gross Savings Rate of Bangladesh was measured at 30.110 % in Jun
2020.

GDP per Capita Bangladesh

In graph we can see that Bangladesh income per capita is increasing day by day which is very
good sign for Bangladesh Economy. Bangladesh GDP Per Capita reached 1,970.000 USD in

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Jun 2020, compared with 1,828.000 USD in Jun 2019. Bangladesh GDP Per Capita data is
updated yearly, available from Jun 1960 to Jun 2020, with an average number of 293.160
USD. The data reached an all-time high of 1,970.000 USD in Jun 2020 and a record low of
89.035 in Jun 1960. CEIC extends history for annual GDP per Capita. The Bangladesh
Bureau of Statistics provides GDP per Capita in USD. GDP per Capita prior to 2006 is
sourced from the World Bank. GDP per Capita is in annual frequency, ending in June of each
year.[ CITATION GDP \l 1033 ]

Bangladesh is considered as a developing economy. In the last decade, the country has
recorded GDP growth rates above 5 percent due to development of microcredit and garment
industry. Although three fifths of Bangladeshis are employed in the agriculture sector, three
quarters of exports revenues come from producing ready-made garments. The biggest
obstacles to sustainable development in Bangladesh are overpopulation, poor infrastructure,
corruption, political instability and a slow implementation of economic reforms.
[ CITATION BDG \l 1033 ]

Income Per Capita of India:

India GDP Per Capita reached 2,139.222 USD in Mar 2020, compared with 2,044.586 USD
in Mar 2019. India GDP Per Capita data is updated yearly, available from Mar 1958 to Mar
2020, with an average number of 313.196 USD. The data reached an all-time high of
2,139.222 USD in Mar 2020 and a record low of 70.396 in Mar 1958. CEIC calculates GDP
per Capita from annual Nominal GDP and annual Population and converts it into USD.
Central Statistics Office provides Nominal GDP in local currency based on SNA 2008, at
2011-2012 prices and Population. Federal Reserve Board average market exchange rate is

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used for currency conversions. GDP per Capita is in annual frequency, ending in March of
each year.

Income per Capita India In the latest reports, India GDP contracted 23.922 % in Jun 2020.
India Nominal GDP reached 502.106 USD in Jun 2020. Its GDP deflator (implicit price
deflator) increased 1.778 % in Jun 2020. Gross Savings Rate of India was measured at 30.114
% in Mar 2019.[ CITATION GDP1 \l 1033 ]

Bangladesh GDP Comparison with India:

India's GDP per capita in real terms was 1.4 times that of Bangladesh in 2016 but has
narrowed each year since then. As of 2020, the projections place the ratio at 1.2. Further, in
overall GDP terms (at current prices), India's economy was 14.8 times that of Bangladesh in
2010. As of 2020, the ratio has fallen to 8.15.

YEAR BANGLADESH INDIA

2015 1236.000 1609.702
2016 1385.000 1640.680
2017 1544.000 1764.334
2018 1675.000 2015.228
2019 1827.000 2041.091
[ CITATION GDP2 \l 1033 ]

India's economic growth slowed in 2011 because of a decline in investment caused by high
interest rates, rising inflation, and investor pessimism about the government's commitment to
further economic reforms and about slow world growth. Investors’ perceptions of India
improved in early 2014, due to a reduction of the current account deficit and expectations of
post-election economic reform, resulting in a surge of inbound capital flows and stabilization
of the rupee. Growth rebounded in 2014 through 2016. Despite a high growth rate compared
to the rest of the world, India’s government-owned banks faced mounting bad debt, resulting
in low credit growth.

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 Bangladesh VS India
2500

2000 2015.23 2041.09

1764.33 1827
1609.7 1640.68 1675
1500 1544
1385
1236
1000

500

0
2015 2016 2017 2018 2019

Bangladesh India

In graph we can see that Bangladesh and India both Income per capita is increasing day by
day but we can say that Bangladesh GDP per capita in growing fast and increasing rate is
higher than India.

Increasing GDP per capita is good sing for any country. We can say that Bangladesh
economy is improving fast.

Bangladesh’s nominal GDP per capita is expected to exceed India’s in 2020 created furor.
First and foremost, comparing India to Bangladesh is like comparing apples with oranges.
India’snominal GDP is $2.94 trillion, while in purchasing power parity (PPP) terms, it is
$10.51 trillion. Comparable figures for Bangladesh are merely a GDP of $348bn and$861bn
in nominal and PPP terms.

Predicts real GDP growth of 15.7%, while Fitch predicts a 9.9% growth for India in FY22.
IMF predicts a growth of 8.8% for FY22 for India, it estimates Bangladesh GDP to grow by a
mere 4.4%.

India’s exports last year stood at $322bn, in terms of FOB, while imports stood at $617
billion, on CIF basis .What this implies is India’s overall annual trade (exports + imports) at
$939 billion is 2.7 times higher than then tire economy of Bangladesh. India’s apparel exports
are expected to touch $300 billion by 2024-25, resulting in a tripling of the country’s market
share globally from 5% to 15% cent. A lion’s share (71.27%) of Bangladesh’s total exports of
just $40.53 billion on the contrary is limited to only 10 countries. Again, of this$40.53
billion, $25.53 billion came from apparel goods, which means Bangladesh is in a highly
precarious situation. India exports approximately 7,500 commodities to about 192 countries. [
CITATION San \l 1033 ]’

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Conclusion

Comparing to the India income per capita vs. Bangladesh Income per capita, we can say that
India income per capita is ahead, because their export import and GDP volume is very high
comparing to India. According to the IMF, India is set to drop below Bangladesh in terms of
per capita Gross Domestic Product (GDP) as the economy is projected to contract by a
massive 10.3 per cent in 2020. To recap, the IMF has projected that in 2020 per capita GDP
of Bangladesh will be USD 1,887.97 at current prices. India will have a per capita GDP of
USD 1,877 in 2020. These changes in the respective economies will be due to a 3.8 percent
increase in Bangladesh's GDP and 10.3 percent decline in India's GDP in 2020. GDP per
capita in India is expected to reach 1900.00 USD by the end of 2020, according to Trading
Economics global macro models and analysts’ expectations.

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References

Berma, S. (n.d.). Retrieved from https://bangaloremirror.indiatimes.com/opinion/others/india-

vs-bangladesh-fact-vs-fiction/articleshow/78689592.cms?
utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
GDP. (n.d.). Retrieved from https://www.ceicdata.com/en/indicator/bangladesh/gdp-per-
capita
GDP. (n.d.). Retrieved from https://www.ceicdata.com/en/indicator/india/gdp-per-capita
GDP. (n.d.). Retrieved from https://tradingeconomics.com/bangladesh/gdp-per-
capita#:~:text=GDP%20per%20capita%20in%20Bangladesh%20averaged
%20522.13%20USD%20from%201960,of%20322.30%20USD%20in%201972.
GDP, B. (n.d.). Retrieved from http://www.bbs.gov.bd/site/page/dc2bc6ce-7080-48b3-9a04-
73cec782d0df/Gross-Domestic-Product-(GDP)
https://www.ceicdata.com/en/indicator/bangladesh/gdp-per-capita. (n.d.).