Global empirical evidence shows that higher urban primacy can foster economic growth at earlier stages of development
Three urban and sustainable development specialists of the World Bank in a blog published on the global lender's website a year ago have put it simply: Bangladesh's path to upper-middle-income status by 2031 will hinge particularly on leveraging Dhaka, its economic and political center.
What's the ground reality here in Dhaka, Bangladesh's capital? It is a primate city. Not only is it the country's largest city, but it is also disproportionately larger than other Bangladeshi cities. Its population, for example, is more than four times greater than that of Chattogram's, the country's second largest city. Dhaka accounts for one-fifth of national GDP and one-third of all jobs.
But the present chaotic situation in the capital city as described on the Economist Liveability Index, which ranks 140 cities of the world assessing urban quality of life based on stability, health care, education, culture, infrastructure and environment, holds little hope.
Dhaka has been ranked as the third worst liveable city in the world on the index prepared by the Economist Intelligence Unit. War-torn Damascus in Syria ranked the worst. The capital city of Bangladesh received an overall score of only 39 out of 100. It performed well only on stability indicators, scored 55 out of 100, as the city saw little political unrest in recent years. But, it looks weak on health care and infrastructure indicators, scoring only 29.2 and 26.8 respectively.
Major cities of an upper middle income country must have a rating above 50. This means Dhaka has a long way to go to be transformed into a better liveable city, though the chaotic, haphazard and indiscriminate urbanisation has already choked its growth in a planned and coordinated way.
However, the analysis of the World Bank's specialists holds some hopes for the city.
Dhaka's experience as they say as a "primate" city is not uncommon. For most developing countries, urban concentration follows an inverted U-pattern: at first, as national incomes rise, the largest cities' share of the urban population increases. Over time it starts to decline in favor of more equal spatial development, they say, adding, "The tipping point is usually when national GDP per capita reaches the global average. Such trends tend to occur hand-in-hand with structural transformation, as the economy shifts away from agriculture toward industry. Global empirical evidence shows that higher urban primacy can foster economic growth at earlier stages of development."
But that should not be a cause of complacency. A concerted and well designed masterplan is needed to begin reinventing Dhaka and other cities. One of the major focus of the masterplan should be revamping the local government institutions such as city corporations, zila parishads, upazila parishads and municipalities. By reinventing them, the local governance system can be improved; local government institutions can be transformed into service delivery systems in a true sense. For that purpose, re-distribution of political power that has long been due should be carried out with utmost urgency. A huge number of public representatives in those local government institutions need to be transformed into leaders and change makers in their localities to implement development activities and various social programmes to improve the economic life of the people.
The current situation that urgently requires reforms does not tell any inspiring story.
Constitutionally they are empowered as the framers of our constitution dreamt of a true democracy having a strong local government system.
For example, Article 11 of the Constitution says the Republic shall be a democracy in which fundamental human rights and freedoms and respect for the dignity and worth of the human person shall be guaranteed, and in which effective participation by the people through their elected representatives in administration at all levels shall be ensured.
In Article 59, the Constitution empowers local government bodies to perform important functions relating to administration and the work of public officers; the maintenance of public order and the preparation and implementation of plans relating to public services and economic development.
For the purpose of giving full effect to the provisions of article 59, Parliament shall, by law, confer powers on the local government bodies referred to in that article, including power to impose taxes for local purposes, to prepare their budgets and to maintain funds, reads Article 60 of the country's supreme law.
The reality tells a story in variance with the constitutional provisions.
Every unit of local government bodies, though none of them has become an institution, has separate law made with the constitutional provision regarding their formation and functions. But, in reality, they are unable to discharge the duties because of either other government organisations or opposition from the local bureaucracy.
Take the case of two city corporations in the capital. The city corporations do not have much to say about the functions relating to administration and the work of public officers, the maintenance of public order and the preparation and implementation of plans relating to public services and economic development in the capital as more than four dozen organisations of different ministries are doing most works relating to utility services and city development. Moreover, lack of coordination among their works remains acute causing trouble for city dwellers. The long demand for a metropolitan government for better coordination of those organisations under the umbrella of the city corporations has been paid little attention by the policymakers. So, the governance structure of Dhaka city remains in shambles unlike other cities in upper middle income or higher income countries where municipal corporations play a big role in managing the cities.
The situation is no different in city corporations in other metropolitan areas. The situation is worse in zila and upazila parishads—two vital tiers of the country's local government system. District and upazila administrations led by civil bureaucrats such as DCs and UNOs are carrying out most development activities and managing other local affairs. Elected representatives in those vital local government bodies do not have much say about the local affairs—be it implementation of infrastructure development projects or of social welfare programmes. Moreover, MPs of the areas, who are advisers of the two local government bodies in their electoral areas, are interfering in the functions left for the zila and upazila parishads.
This cannot be a healthy environment for growth of local government bodies. Due to their fragile state, they cannot contribute to economic development in local areas like the local government institutions in upper middle income countries.
Take the example of the Philippines that has a vibrant local government system that has moved close to becoming an upper middle income country from lower middle income. Even our neighbouring country India has been strengthening its local government system both in urban and rural areas.
The current state of local government institutions in Bangladesh clearly says they are unable to make a difference. A few years ago, AMA Muhith, when he was finance minister, had been continuously advocating for strengthening the local government system even by devolution of the powers for acceleration of economic growth. He once categorically said that achievement of double digit growth would not be possible without transforming the local government institutions into local growth centres. He made this call every year in his budget speeches. But the policymakers did not pay heed to his call he made for around 10 years since 2009. After he retired from politics two years ago, no such call has been made by any other policymakers. But there is no other way before us but to empower the local government institutions by encouraging honest and dynamic leadership for them. What other countries have been able to do is also possible for Bangladesh. For this, the political commitment is a must to set the reform agenda and carry it out.
The lesson the pandemic has taught us is noteworthy. Due to excess dependency on Dhaka city, the economy has faced setbacks after the government tried to enforce restrictions on movement in the city to contain the spread of the virus. The city also saw reverse migration as many people who migrated to Dhaka for making a living returned to villages after the sources of their income dried out.
Will it yield good results if people are restricted from entering Dhaka for a livelihood? The World Bank specialists' answer will be negative.
In their blog, they say as experience in China and other countries has shown, restricting people from moving to the biggest cities is counterproductive – strong barriers to labour mobility limits urban growth and may result in large income losses. In short, for a city like Dhaka, it is more costly to be too small than too large.
Dhaka's experience as a primate city is notable, not for its urban concentration per se, but for its unrealised economic potential. It has one of the highest population densities in the world, the economic density in Dhaka is in fact lower than other similar metropolitan areas. The concentration of GDP is $55 million per square kilometer, lower than other major primate cities in Asia such as Bangkok ($88 million) and Singapore ($269 million).
Should Bangladesh look to secondary cities outside Dhaka to drive national economic growth and lift the country to upper-middle-income status? The three World Bank specialists raised the question.
The answer offers food for thoughts. "In other countries facing congestion and poor livability in their biggest cities, building new towns and relocating population often emerge as tempting policy options. The growth and prosperity of secondary cities should be supported, and efforts should be made to promote the development of a diverse and complementary system of cities.
To unleash Dhaka's economic potential, the government will need a set of integrated policies that improve livability through the provision of infrastructure and basic urban services, and that promote more diverse and competitive economic activity in the city center and the periphery," note the analysts.
The bottom line is simple: let the local government institutions function in the light of the constitutional provisions. For this redistribution of the political powers between the central and local government is a most important decision that needs to be considered urgently. Improvement in city governance along with empowerment of the local government institutions can make a difference in coming years towards achieving Goal 2031.
Shakhawat Liton is deputy executive editor at The Business Standard