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Bangladesh Business

Business

Agriculture is completely dominated by agriculture. A strong dependence on jute exports stems from the British colonial power's use of Bengal as a commodity producer. Bangladesh has gas deposits but few mineral resources. The industrial sector is poorly developed, but accounts for an increasing share of the country's GDP. The economy is heavily dependent on aid. Since 1990, the country has implemented a restructuring program initiated by the World Bank, and the government has succeeded in reforming the economy in a number of areas, among other things, inflation has fallen.

Business and Economy of Bangladesh

Agriculture, livestock management, forestry and fishing

According to countryaah, agriculture is essentially focused on self-sustaining. Rice is the most important crop and is grown on 80 percent of agricultural land. Animal husbandry, especially cows and water buffaloes, forms a large part of the agricultural economy. Rice production has increased strongly since the mid-1970s and in 2000 the country became self-sufficient for rice for the first time. Wheat production has also developed strongly and is now the second most important crop.

Bangladesh accounts for 90 percent of the world's jute exports, and jute cultivation is an important source of income for many farmers. Tea is also an essential barley crop. Other agricultural products are legumes, potatoes, oilseeds, sugarcane, wheat, tobacco and fruit. The arable land is fertile, but agriculture is often affected by floods, cyclones and drought. A number of irrigation projects in recent years have been aimed at reducing the dependence on the monsoon rains. The livestock, which are used primarily as draft animals, feed on low-quality agricultural waste. There is a lack of quality feed. Replacing existing cattle with high-milking but resource-demanding breeds is therefore not possible.

Forests cover almost 15 per cent of Bangladesh's area and form the basis of the wood and paper industry. The area is quickly reduced by harvesting, logging and clearing for cultivation or grazing. Raw material withdrawals to the growing paper industry have contributed to this. Bamboo is the most important building material in the countryside, but the stocks are overexploited and declining, while the need for population growth increases. Deforestation in the rivers' catchment areas, mainly outside the country's borders, has reduced the flow equalization between rainy and dry times, with unrestrained high tide and floods as a result. The low-lying delta areas populated by millions of people are periodically flooded by monsoon rains and tidal waves. India's regulation of the Ganges has reduced the freshwater outflow, thereby increasing the salinity within parts of the coastal area's mangrove forest. This has led to a reduction in the size of the mangrove forest, a development that has been accelerated by harvesting. As a result, protection against erosion and tidal wave progress has been lost.

Fishing is traditionally an important part of the rural economy. Most of the population's animal protein intake comes from fish, which has also become an important export commodity.

Minerals and energy

Relatively small quantities of minerals exist in the country, and Bangladesh is heavily dependent on oil and coal imports for its energy supply. Natural gas has been found in northeastern Bangladesh and is increasingly being used as an energy source. Households derive energy mainly from waste, agricultural waste and firewood.

Industry

The industrial sector contributes about 30 per cent to GDP. Important products are refined jute, cotton textiles, paper, manure, cement and sugar. Dhaka is the center of the jute, cotton and sugar industries. Every fifth industrial worker is active in jute processing. Chittagong has steel mills and paper industry. About 80 per cent of the industrial workforce is estimated to work in small industries, often located in rural areas, where fabric, yarn and clothing production dominate.

Foreign trade

Bangladesh has a large trade deficit. Important import goods are capital goods, machinery and food. Clothing dominates exports. Jute and its processing are also important export products. Imports come mainly from China, India and Singapore, while the main export markets are Germany, the United States and the United Kingdom.

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