Addressing Regional Inequality Issues in Bangladesh Public Expenditure

Chowdhury Shameem Mahmoud, Syed Naimul Wadood, Kazi Sabbir Ahmed
JEL codes: 
Centre for Policy Dialogue

Traditionally development effort of Bangladesh government have aimed at achieving equitable economic growth. The concept is an overriding factor in formulating national policy strategies of poverty alleviation. In this context, the objectives of poverty alleviation are mostly designed with social development factors, particularly improvements in health and education indicators. One of the most important policy documents Unlocking the potential: National Strategy for Accelerated Poverty Reduction (the PRSP paper which was extended till June 2008), and other government documents embody such with great importance (Medium Term Budget Framework 2007- 2010 documents on website of the Ministry of Finance. Since returning to democracy in
1991, Bangladeshs economy has achieved a steady growth rate with concomitant fall of poverty incidences at an accelerated pace. In fact, the country experienced more than 10 percentage point fall in poverty rate between 2000 and 2005 (Table 1), which is indeed a commendable achievement aligned to other better performances that Bangladesh has been experiencing for the last three decades since independence. One feature of this development is, however, less assuring. Regional analysis of poverty incidences shows that reduction rate is not equal across the country, rather the situation is worsening in
some cases. Such picture reflects an unequal progress in overall economic activity throughout the country.