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close this book Developing the non-farm sector in Bangladesh
View the document Foreword
View the document Abstract
View the document Acknowledgements
View the document Summary
View the document Imperatives and models
View the document Macroeconomic trends in Bangladesh
Open this folder and view contents What drives growth?
Open this folder and view contents Pattern of development
View the document Choosing appropriate technologies
Open this folder and view contents Other lessons from comparative experience
Open this folder and view contents Rural industry in Bangladesh
Open this folder and view contents Rural industry and export-led growth
View the document Growth poles
View the document Concluding observations
View the document Tables and chards
View the document Bibliography



To increase per capita incomes at a faster pace and reduce the incidence of poverty, Bangladesh must significantly raise the average GDP growth from the 4 percent range of recent years to 7-9 percent per annum. The sectoral sources of growth are limited, the share of industry in GDP is small, and the sector lacks dynamism. Although services account for 45% of GDP, the likelihood of it providing much additional growth momentum are also quite limited. Thus, an improvement in Bangladesh's economic performance is likely to come from an increase in agricultural productivity and the spread of rural industry. The purpose of this paper is threefold: to provide the macroeconomic backdrop to development in Bangladesh and to show how it compares with other countries with respect to a number of key indicators; to explore the preconditions for the emergence of rural industry as a leading sector and the lessons from the experience of Asian and African economies with regard to rural industrialization; the state of agriculture and rural industry in Bangladesh and a discussion of factors explaining recent trends; and the delineating of a strategy for promoting rural based industries with backward linkages to agriculture and forward to the urban sector.

The findings of the study underscore the importance of location, with the hinterland of a few key cities having an edge over other parts of the country; the contribution of transport and communication infrastructure to rural industrialization; the advantages of adopting an export orientation and of seeking foreign direct investment; and the potential developmental role of local governments.