INTRODUCTION

With 120,000 full-time staff members, 1,000 non-governmental organizations (NGOs) provide health care, education, and micro-credit in Bangladesh (NGO Bureau 1994). BRAC, the Bangladesh Rural Advancement Committee, alone has 24,000 full-time and 34,000 part-time staff members and spends over US$288 million a year, an amount equal to one-thirtieth of the government budget (BRAC 1999, pp. 10–12). There are many NGOs as large as BRAC in Bangladesh.

Why have Bangladeshi NGOs expanded so much? In this chapter I will suggest the absence of a welfare state and an underdeveloped market economy as the basic reasons. Developed countries have contributed to Bangladeshi NGO expansion financially, and the Bangladeshi Government actually cannot control the NGO sector that is linked to the global new social movement. By referring to these factors, this chapter sketches the process of NGO sector growth and analyses its impact on the Bangladeshi state and society. Bangladeshi NGOs should be praised for creating a public resource distribution system beyond the nation state.

WEAK STATE, UNDERDEVELOPED ECONOMY

The Bangladeshi Government continues to use up resources to build its support base. Having grabbed political power by a coup d'état, the military rulers have bought off the country's power elite to overcome weak legitimacy (Sato 1990, pp. 20–29). Furthermore, party politicians, even though elected in democratic elections, give their supporters government resources as the spoils of victory at the polls.

Neither providing welfare services nor promoting a rational market economy, the Bangladeshi spoils system has given rise to a small group of political profiteers (Murayama 1998, pp. 17–23; Osada 1998, pp. 33–35). For example, the banking sector has lent Tk580.833 billion, 41 per cent of which are bad loans now (The Daily Star, 15 June 2000). The Bangladesh Krishi (Agriculture) Bank alone has incurred Tk15.625 billion in bad loans, 56.5 per cent of the total financing (Ministry of Finance 1994, pp. 330–36).