Economic Growth, Poverty and Inequality Trend in Bangladesh

The incidence of poverty in Bangladesh is one of the highest in the world. Millions of people suffer from the hardship of poverty. Currently one-third (31.5 percent) of its population are living below the poverty line. Moreover, inequality afflicts the persistence of poverty. The average annual rate of poverty reduction in Bangladesh during 2000-2005 was the second highest among south Asian countries. The pace of poverty reduction in Bangladesh is, however, much lower than in faster-growing east Asian countries like China, Thailand, and Vietnam, which underscores the importance of higher growth for achieving even faster reduction in poverty. The present study is an attempt to focus on the poverty trends, economic growth and inequality in Bangladesh. This paper is also focused on to decompose inequality and poverty by rural, urban and national level households. The study is based on the analysis of secondary informations which have been collected from different sources. Since 1991-92, the incidence of poverty has decreased to 31.5 percent in 2010 from 56.7 percent in 1992. From the study, it is evident that, the incidence of poverty is higher in rural areas than that of the urban areas and the rate of decrease of poverty is also higher in rural areas (1.24 percent) than that of the urban areas (1.13 percent). Both general inflation and food inflation are responsible for raising the income inequality in Bangladesh. Despite steady growth of GDP in last one decade, the general people are suffering more due to higher growth in household expenditure and food inflation in compare with growth in income. The analysis shows a clear picture of the current trend of poverty and inequality in Bangladesh.