IMPACT OF COVID 19

in the Economy of Bangladesh

By THE INSURGENTS

Cases overview
Till 14th June 84.3K Cases Founded and 1139 Deaths has been Confirmed

Economic Growth
World Bank and the International Monetary Fund (IMF) have
expressed apprehensions about the economic growth that may slide down to just
over 2.0 % during the current fiscal year.

Poverty
Poverty rate in Bangladesh may rise to 40.9% if Covid-19 causes 25 % fall in
family incomes, according to the SANEM.

Till now, the Bangladesh readymade

garments (RMG) industry has received work
order cancellations of nearly $3 billion.

People like Hossain are also part of the

Around 2 million workers in the industries
informal sector, which accounts for almost 80-
will be affected by this. Around 4 million
90% of the jobs in Bangladesh. The pandemic
people are directly engaged with the RMG
has hurt them the most. Between March and
sector e.g. backward linkage industries,
May, the average family income subsided by
accessories and packaging factories and
as much as 74%
transportation sector.

We all know the banking industry is in back

gear due to mounting non-performing loans
(NPLs). If the RMG industry and its
backward linkage industries fail, then the
entire banking system will collapse. Today,
59 commercial banks and general
insurance companies are heavily relying
on garments and related industries for their
business.
Another study on national food security
by BRAC revealed that during the 45-day
lockdown period between March and
May, the country's farmers faced a loss
worth 565.36 billion taka (€5.9 billion,
$6.66 billion).

ECONOMY'S IMPACT ON COVID 19

If we look at the sector-wise resource distribution of

operating and development budget for the fiscal year 2019-20, we would see
the health sector has received merely 4.9% of the total allocation.
Meanwhile, the education and technology sector has received
15.2% allocation which is more than 3 times higher than the health sector
allocation. Due to poor investment in healthcare infrastructure nationwide and
scarcity of medical equipment i.e. testing kits, and doctors to combat
Covid-19, the government is passing a very hard time.

PLAN OF ACTION AND REALITY

72,750 Crore
On April 5, Prime Minister Sheikh
Hasina unveiled a Tk72,750 crore
stimulus package, including the
previously declared Tk5,000 crore
package, to address the economic
impacts of the coronavirus outbreak.
The
amount is nearly 2.52 % of the countrys
GDP. The government could take
both fiscal and monetary measures to
combat the novel coronavirus.
Around 34 million people, or 20.5 % of the
population, live below the poverty line,
according to Bangladesh Bureau of Statistics
(BBS) data. An analysis by Dhaka-based South
Asian Network on Economic Modelling
(SANEM) shows that this number would rise by
36 million if the income level for poverty line is
raised by 1.25% These 36 million, not officially
categorised as poor, can certainly be viewed as
economically powerless. Many of them are
likely to fall into poverty trap because of the
pandemic.

zawad.hasan5957@gmail.com
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