This chapter examines the development of public law in South Asia: a legal family that has been defined by its history of British colonialism and continued adherence to the common law legal tradition. It traces the evolution of constitutionalism in four countries – India, Bangladesh, Pakistan and Sri Lanka – since their independence from Britain, focusing on two common regional themes. The first is the judicialisation of politics through the adoption (or at least consideration) of the basic structure doctrine, which permits courts to define and enforce implicit limits on constitutional amendments. The second is the centralisation (and abuse of) executive power, which has imperilled democratic rule in all four countries. While neither of these developments is specific to South Asia, the interplay between them, resulting in separate spheres of unchecked judicial and executive domination, is perhaps unique to the region and warrants further attention from comparative scholars.

This chapter analyses the major development achievements of the Bangladeshi economy until today and seeks to identify the major challenges it will have to address in the future. Whether these challenges can be overcome, and which reforms can be undertaken for this to happen, depends in turn on the institutional context of the country. Focusing exclusively on economic and social issues, this chapter first analyses the sources of growth and possible limitations of the present development regime. It then evaluates the financing constraints faced by the economy in general, and by the public sector in particular. It also focuses on sources of concern in social and environmental areas and economic crisis related to COVID-19.

This chapter underscores the importance for obtaining a proper understanding of the outcomes primary education system in Bangladesh produces. It also emphasises that the provision of primary education is an important institutional issue as it requires effective mechanisms for the recruitment, training, and retention of teachers; the construction and maintenance of schools and other infrastructure; the design and implementation of the curriculum; the monitoring of progress, through inspections and examinations; and the creation of a learning environment. This chapter analyses the challenges related to the coexistence of various actors in the primary education system, the inadequate allocation of resources, the lack of incentives to attract high-quality teachers, the shortage of trained teachers, the low quality of the educational infrastructure, the poor curriculum design, and the flawed examination system. This chapter relates some of these challenges to the public sector in general in Bangladesh. Finally, it recommends relevant measures to overcome the institutional challenges of public spending in primary education and to improve the quality of services.

In this chapter, the key findings and arguments of the previous chapters are combined into a synthesis. This ‘institutional diagnostic’ not only provides an account of the most important institutional issues facing Bangladesh but also seeks to identify the complex chains of causality which relate them both to the economic outcomes that they generate and to the proximate causes and deep factors from which they derive. It begins with a summary – firstly of the historical and political context and then of the more specific findings that have emerged from the thematic studies. From this, three basic institutional weaknesses are identified, each of which recur multiple times in the thematic studies – the supremacy of the ‘deals environment’, ineffective regulation, and weak state capacity. In each case, it is explained both how these institutional factors constrain economic development and how they derive from and indeed maintain the political economy context and other deep factors. Some key directions for reform are identified together with a discussion of where the political barriers to implementing them may lie. Some further reflections are made on impact of the COVID-19 pandemic.

This chapter identifies and evaluates the institutional causes of the failures of the tax system in Bangladesh. At less than 9%, Bangladesh is among the countries with the lowest overall average ratio of tax revenue to GDP. It follows that its fiscal space, that is the capacity to spend on public goods and correct rising income inequality, is extremely limited. The low average tax ratio results from both low nominal tax rates and a low rate of tax collection, itself due to pervasive tax evasion (often with the paid support of tax collection personnel) or to tax exemptions generously granted by the Government to its supporters. In addition, albeit in a limited way, taxation distorts economic incentives, either directly through non-uniform tax rates that favour some sectors or firms and penalise others, or indirectly through exemptions and evasion. This chapter also explores the reasons behind the difficulties that have surrounded previous attempts at tax reforms, and the underlying political economy factors. It, finally, lists the most attractive reforms in terms of increasing tax revenues, the effectiveness of tax collection, and the redistributive impact of the tax system.

The scarcity of land and resulting high prices have important implications for the prospect of industrialisation in Bangladesh. The situation is yet more complicated due to the weak land management system, which perpetuates land grabbing, high rent generation, and ineffective property rights. This chapter analyses the importance of a well-functioning land management in Bangladesh. It elaborates on the history of the policy reforms and the evolution of rules and regulations related to land administrative and management in Bangladesh and analyses institutional complexities in the current system of land management. It also explores how the SEZs initiative has emerged as an alternative management system and the complexities related to the acquisition of land for SEZs. This chapter shows that the institutional mechanisms of land acquisition and compensation are subject to a range of corrupt practices, which in turn create vested interests that resist change and a bias towards politically connected purchasers, or towards those willing and able to pay bribes. Such an environment is inimical to a good business climate and undermines the strategic economic purpose of the SEZs.

This chapter provides a narrative analysis of the process through which involuntary land dispossession takes place in the particular socio-economic and historical context of Bangladesh, and the relative inability of the judiciary to resolve such cases. It also provides information about the way the judiciary works in general – another aspect of state capacity where Bangladesh appears relatively weak, for both logistical and institutional reasons. Logistical reasons relate to a lack of resources, whereas institutional reasons relate to the way the judiciary is influenced by both political and economic interests, as well as the fact that most actors in the judiciary extract rents from the system and act, almost collusively, to maintain its dysfunctionality. Consequently, this chapter scrutinises the interrelation between economic assets, human actions, and state institutions and its possible impact on the overall trajectory of long-term development. Finally, this chapter identifies potential reform measures and agendas in relation to land dispossession litigation in Bangladesh.

This chapter explores the institutional challenges of export diversification in Bangladesh in the context of the dominant RMG sector. It evaluates the features of the ‘RMG model’ of export success, explores the dynamics of the institutional space around the RMG sector in Bangladesh, and analyses the sustainability of the ‘RMG-centric’ export model. The evidence suggests that the very same institutional features which enabled the growth of the RMG sector are missing in other sectors – that there is not the same organisational capacity for industry leaders to participate in collective bargaining with the state, whilst key policy instruments are biased in favour of RMG and against other sectors, which has not been used to help industrial diversification. However, as the RMG sector has been, and to a large extent still is, the strength of Bangladeshs development, it might become the country’s ‘Achilles hell’ in the future, if it weakens and prevents other manufacturing exports from developing. Therefore, there is a need for a well-designed and effective industrial policy targeting the emerging dynamic export sectors.

This chapter identifies areas where in-depth research can find out institutional challenges that are most critical to Bangladeshs economic development. Two approaches are employed. The first approach uses a variety of institutional measures available in international databases to examine how a country, in this case, Bangladesh, differs from a set of comparators. It is largely based on these indicators that the idea of a Bangladesh paradox was formed: Bangladesh appears as a country with impressive economic growth performance but weak institutional performance. However, there can be some doubt about the reliability of institutional indicators in global rankings. Therefore, the second approach is undertaken where a questionnaire survey of various types of decision-makers and academics is used. The survey respondents identify several institutional weaknesses which include ubiquitous corruption (electoral, business, and recruitment to the civil service); executive control over legal bodies, the media, the judiciary, and the banking sector; inadequate coverage of public services; the number and intensity of land conflicts; and gender discrimination.

This chapter elaborates on the general approach pursued in this volume to identify institutional weaknesses that may be preventing growth in Bangladesh from being faster and more inclusive today and that may cause it to slow down in the future. It also provides a brief overview of the political history of the country, without which it is difficult to understand its development achievement, as well as the present political economy context. Finally, in the light of that historical sketch, some reflections are offered on the specificity of the institutional link between business and politics in Bangladesh, a link that very much frames its development and that are often referred to throughout this volume.

This chapter provides a narrative analysis of the process through which involuntary land dispossession takes place in the particular socio-economic and historical context of Bangladesh, and the relative inability of the judiciary to resolve such cases. It also provides information about the way the judiciary works in general – another aspect of state capacity where Bangladesh appears relatively weak, for both logistical and institutional reasons. Logistical reasons relate to a lack of resources, whereas institutional reasons relate to the way the judiciary is influenced by both political and economic interests, as well as the fact that most actors in the judiciary extract rents from the system and act, almost collusively, to maintain its dysfunctionality. Consequently, this chapter scrutinises the interrelation between economic assets, human actions, and state institutions and its possible impact on the overall trajectory of long-term development. Finally, this chapter identifies potential reform measures and agendas in relation to land dispossession litigation in Bangladesh.