What’s Next for Bangladesh after the Monsoon Revolution?‌‌

How would you characterize the political and economic situation in Bangladesh today, several months after the Monsoon Revolution? ‌

The key word is “uncertainty.” The previous government was increasingly autocratic and centralized a lot of power, and then the revolution was led by students who weren’t politicians or administrators. It was a very decentralized revolution; established opposition parties really did not play a frontline role in toppling the government. This was very unusual, because revolutions are often catalyzed by an identified opposition and leader. The unusual nature of this uprising has left a bit of a leadership vacuum that multiple groups and parties will now try to fill. ‌

After the government fell, the students realized there was a danger of being sidelined. When the army chiefs first called a meeting, they invited the opposition parties, and did not immediately give the student leaders a seat at that table. The student leaders’ response was strategic and clever: they went on Facebook Live, a very decentralized social media platform, and called for Dr. Muhammad Yunus to serve as leader of the interim government. Yunus has international name recognition and enjoys global respect by virtue of winning the Nobel Prize; invoking his name brought the students back to relevance. ‌

In forming this interim government, Yunus has tried to appoint people with significant background and skills to advisory positions. For example, the current governor of the central bank spent most of his entire career at the IMF, which has prepared him well for this position. A respected economics professor from Dhaka University took charge of the planning ministry. This method of appointing people, based on personal knowledge and connections, is a way of ensuring that civil servants are trustworthy and somewhat apolitical. But an issue that emerged over the last six months is that they simply did not appoint enough people to run a complex country of 175 million people. This has slowed down the process of getting the ordinary business of government done. The uncertainty also makes it difficult for bureaucrats to act.‌

News outlets have reported that a crime wave in Dhaka is causing discontent with the interim government. Is that connected to the slowdown of government business?

Immediately after the revolution, ordinary citizens definitely experienced some breakdown in law and order. Historically, as in many other developing countries, there have always been people with street muscle who extract money from productive people and business owners through protection rackets. Under the old regime (at the risk of massively simplifying a complex political institution in one sentence), the government protected street thugs who extracted from businesses, who in turn helped it remain in power. This is all extra-legal, but it created a kind of equilibrium under which business owners knew who they needed to keep happy. At least the “rules of the game” were clear to all participants. ‌

When the government fell, that system broke. Now, the old street thugs affiliated with the ousted regime are no longer relevant. New people are competing to be in that position. In my conversations with people in the garment industry, I’ve learned that this has created a lot of business uncertainty. It’s harder for them to do business because of these requests for protection money from different sources. ‌

Another problem is that the previous regime used the police to try to put down the revolution. As a result, the police have lost a lot of credibility and trust and now fear retribution themselves. They have tried to stay under the radar, but if they are perceived to be absent, then criminals will try to take advantage of that. The current government needs to reestablish a trusted police force and work towards building trust between citizens and police.‌

You’re serving on a task force advising the interim government on economic strategy. What does your work there look like? ‌

The task force has a wide-ranging mandate of thinking about all sorts of development and economic policy, from macroeconomics to education, health, and other important sectors. When I joined the task force, I saw there were already many other talented members interviewing stakeholders in various sectors to devise strategy. I realized that I could be more useful if I accomplished specific actionable projects. So I dedicated my efforts to working with the Ministry of Expatriate Welfare to establish a new migration pathway from Bangladesh to Japan. Bangladesh relies heavily on migrants’ remittances for foreign exchange earnings, so this is a priority both for the country and for those migrants’ families. I was already working with a Japanese company that recruits workers from the Philippines and trains them in Japanese language and culture, to place them at nursing homes and in the hospitality sector in Japan. They have been successful in placing thousands of workers in Japan, so I focused on persuading them to expand their operations to Bangladesh, and connected them with the ministry. After a period of negotiation, the company sent a delegation to make a formal visit to Bangladesh, and they have now signed a memorandum of understanding with the government in the presence of the Japanese ambassador to Bangladesh. They plan to start training and placing Bangladeshi workers with employers in Japan by the end of 2025. ‌

How has your research at Yale prepared you for this work? ‌

I have learned through my action-research projects that building networks is key. Complex problems can rarely be solved alone; to address them, we have to form coalitions and bring people and institutions together. To launch the new migration program, I sent a memo to a few key actors in the Bangladesh government, in which I made an evidence-based case for investing in this relationship; but just as important was the fact that I had pre-existing relationships that ensured the memo got read by the right people. My work with the Bangladesh government during COVID helped solidify those connections and partnerships. And my decades of research on migration in Bangladesh captured the Japanese company’s attention, which was critical. Yale provides a fantastic platform from which to build networks. ‌

In your report for the Atlantic Council, you noted that Bangladesh has become a major garment manufacturer and outperformed its neighbors economically despite years of terrible governance. How do you explain that?‌

When you have autocrats in power, that can create policy and business stability. The uncertainty we’re seeing now isn’t necessarily because of the move from autocracy to democracy; it’s a correlate of regime change. Having a new regime in power, irrespective of the quality of governance, means that the people who were politically connected to the old regime have to change the way they do business. That uncertainty can be destabilizing. What we need right now is both good governance and a reduction of uncertainty. ‌

What are the most important economic reforms to preserve those gains and create a strong economy under a democratic government? ‌

The highest priority right now, even before economic reforms, are the issues of law and order. We need to reduce uncertainty, develop a set of institutions that citizens and businesses can trust, and make people confident that their property rights are being respected.‌

Within economics, though, the first important task is macroeconomic stability. By that, I mean showing investors that the country is on a good path and will be able to honor its debt obligations. If investors aren’t convinced, they will start taking money out of the country. That could create a business equivalent of a bank run, and suddenly the value of the local currency would fall. This type of thing has happened in big countries like Brazil and Argentina, as well as Sri Lanka after they experienced political upheaval a few years ago. ‌

It's important to note that there are stories coming out of billions of dollars looted from banks during the previous regime. Politicians used their muscle to install connected people at banks. Those employees would then authorize multimillion-dollar loans to people who, expectedly, defaulted on their loan obligations. Some of the money even ended up in the hands of a British politician who is a niece of the ousted prime minister. That means that private and commercial banks in Bangladesh could become insolvent. To ensure macroeconomic stability, we need to recover as much as possible of those funds. ‌

Another important cultural issue that has bubbled up is the role of religion in our politics, society, and constitution. Religion traditionally played a smaller role in the Bengali Muslim identity than it does in other Muslim-majority countries, and many of our important customs and traditions derive from a mix of Bengali culture and Islamic religious practices. There may have been some shifts in people’s preferences and beliefs over the last couple of decades—especially in our younger generation—and we are waiting to see how that will play out in the political arena. Religion has played an increasingly important role in politics in every large South Asian country, from India to Pakistan to Bangladesh. My fervent hope is that minority rights and women’s rights are protected in whatever new political equilibrium emerges. ‌