Reckoning in Dhaka: A year since the coup, Bangladesh is in a shambles

In the year since Sheikh Hasina was ousted as Prime Minister, Bangladesh has transitioned from a model of economic transformation and poverty reduction to one of South Asia’s most unstable countries, dominated by Islamic fundamentalists aligned to the China-Pakistan axis. In the process, India has lost one of its staunchest allies, now replaced by an implacably hostile regime. An indecisive “interim” government under Nobel laureate Muhammad Yunus is increasingly prey to non-democratic Islamists, who envisage a Bangladeshi caliphate. None of this augurs well for the country or South Asian stability.

 

Inevitably, the Bangladesh economy has taken a hit. Since Dr Yunus took charge as “chief advisor”, the readymade garments industry, which accounted for 83 per cent of export earnings and 13 per cent of gross domestic product (GDP), has been in a shambles. Some 140 factories have closed down, leaving over 100,000 workers, mainly women, unemployed. Some global brands have left, and 20 per cent of the country’s order book has shifted to Vietnam, Cambodia, Indonesia, Sri Lanka, India, and Pakistan. The economy had grown at an average annual rate of over 6 per cent since 2010, but has now slowed to 3.9 per cent. It is  widely accepted that regime change was precipitated not by a spontaneous “students” movement” but by the Jamaat-i-Islami, the fundamentalists that strongly opposed the creation of Bangladesh in 1971, with support from Pakistan’s military establishment and the US, which has had a history of tension with Sheikh Hasina.

 

But the former Prime Minister, despite presiding over the country’s economic miracle, which had powered one of the world’s poorest nations into a lower middle-income country in 2015, also played a role in precipitating this crisis. Her inability to diversify the Bangladesh economy added to the unemployment problem, especially among the youth. Those aged between 15 and 29 years accounted for 83 per cent of the unemployed, inevitably radicalising them and driving the students’ protest movement. The post-pandemic surge in inflation, compounded by the slowdown in global growth when Russia invaded Ukraine, exacerbated these problems, prompting Bangladesh to seek the International Monetary Fund for a bailout. Garment-industry workers, the overwhelming majority in the informal sector with non-existent benefits and job security, have felt the squeeze the most. These economic weaknesses added to Sheikh Hasina’s flagrant suborning of the institutions of governance such as the courts and the security forces to crack down on her opponents, an example her successors have chosen to emulate.

 

The protection New Delhi has extended to a hitherto dependable neighbour precipitated the outbreak of vicious and retrograde actions, including attacks on Bangladeshi Hindus and other minorities. Though India has patiently reiterated its support for a democratic, peaceful, and inclusive Bangladesh, Dhaka has rebuffed those overtures. Instead, Dr Yunus in March made a high-profile visit to China. The Dhaka-Beijing axis builds on relations Sheikh Hasina had nurtured during her long rule but the common anti-Indian slant of both countries has added a fresh dynamic to South Asian geopolitical paradigms. Dr Yunus announced on Tuesday that general elections would be held in February next year, but the Jamaat, which has rarely garnered more than 5 per cent of the vote in past elections, will be in no hurry to head to the hustings. For India, recent experiences with Sri Lanka and the Maldives suggest that patient diplomacy while events play out is the best strategy yet.