GROWING income inequality, that too during the Covid-19 outbreak, is a sign of uneven development. Central bank data show that the number of bank accounts with more than Tk 10 million in deposits significantly increased in 2020 when the public at large was struggling for survival. The number of bank accounts with deposits of more than Tk 10 million went up by 10,051 and deposits in such accounts rose to Tk 5, 95,286.11 crore in 2020 from Tk 5, 67,585.19 crore in 2019. Meanwhile, the deposits in the accounts which are generally opened with Tk 10 as deposit to receive government assistance dropped by 80.82 per cent in the pandemic-hit year. More than 3 per cent of the labour force has lost jobs and around 16.38 million people have become newly poor during the on-going pandemic, says a recent study of the Centre for Policy Dialogue. Around 69 per cent of the employed population in urban areas have become victims of the economic shock from the outbreak. More shocking is the fact that regular wages of the workers have significantly declined in urban areas. Such unequal wealth accumulation, especially during a health emergency, suggests that the government has failed to ensure economic security for the poor while the rich could enjoy policy benefits and access stimulus packages.
Income inequality is a persistent feature of Bangladesh’s economic development. The accumulation of wealth by a particular section of society during the pandemic is, however, the result of the government’s discriminatory approach to crisis management. A large portion of the stimulus package worth Tk 20,000 crore that the government rolled out for SMEs remained unutilised as most small entrepreneurs did not have access to formal banking. Meanwhile, the aid in cash and food largely failed to reach the poor. A nexus involving government officials, political leaders and businesses were reportedly using the outbreak as an opportunity to embezzle public funds meant for relief. A Transparency International Bangladesh study found evidence of major irregularities in the procurement of emergency medical supplies and the management of cash aid programmes. The stimulus package made available to the apparel industrial sector on conditions that the fund would be used to pay workers and the factories would not fire workers during outbreak; but, in reality, over 100,000 workers were retrenched in 2020. The heightened income inequality as evident in the central bank data is, therefore, the outcome of a policy biased towards the rich.
The government must, therefore, review its policy and revisit its oversight mechanism to ensure that people in need can access the stimulus packages as these are not meant to help the rich become richer. In so doing, it should also involve the Anti-Corruption Commission in looking into new accounts with more than Tk 10 million in deposits and take action if there is any illegal income. The government should at the same time take early measures to provide economic support for the people most affected during the outbreak.
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