THE PLUG-IN POLICY: Applying Research to Reality

The two-day long BIDS Research ALMANAC was held on 6-7 December 2017 at Lakeshore hotel in Dhaka with the theme of “Bridging the Research-Policy Divide”. The aim of the conference was to provide an opportunity to undergo the public scrutiny of BIDS work and to highlight new research ideas and findings. The event allowed a broad spectrum of academics, practitioners, experts and civil society members to be engaged in BIDS research. Spread over a total of six technical sessions, this year’s ALMANAC had 21 papers by BIDS researchers. The sessions were titled Agriculture, External Price Shocks & Rural Well-being, Labour Market Issues, Financial Markets & Financial Inclusion, Climate Change, Natural Disaster and Environment, Entitlement, Welfare & Violence and Exports, Firm Performance & Productivity Growth.

Dr. Mashiur Rahman, Economic Affairs Adviser to the Hon’ble Prime Minister, inaugurated the event as the Chief Guest and Dr. Mohammed Farashuddin, former governor, Bangladesh Bank was present as the special guest. M Syeduzzaman, Former Finance Minister, Government of the People’s Republic of Bangladesh was present as the Guest of Honour. Dr. K A S Murshid, Director General of BIDS chaired the inaugural session and made the opening remarks. The concluding session “Bridging the Research-Policy Divide” was chaired by the eminent economist Professor Rehman Sobhan with distinguished panelists drawn from the public and private sector. The Conference was attended by eminent scholars, policymakers, development practitioners, civil society members, activists, advocacy groups and journalists and generated a lot of interest and provided an effective platform of engagement with key stakeholders. The following pages have some of the key messages delivered in the ALMANAC.

The Framework of a New Nation: A deeper connection to research

Chairman CPD and Former Director General, BIDS

BIDS played a very crucial role in the policy framework of Bangladesh. In my days at BIDS, I did much research which sometimes made a policy impact. At present, the question include: How much quality research are we receiving? How far its relevance to policymakers? Is there any broader goal of people at large? What are the institutional capacities? What is the response to policy-driven researches?

With my experiences from BIDS, I found that the responses of policymakers are critical. There are the demand side and the supply side issues. I initiated research funding without any donors assistance. We only paid Tk 400 a month to a researcher and his policy impact was profound; in this regard, commitment is the issue. China and Vietnam are doing very good in policy research and integrating the research findings into policy implementation.

The public reasoning is also essential for research. Engagement of people with the policy implementation is significant. I commissioned 29 task forces in 1991 and assembled 250 papers from professionals to come up with the policy recommendations. The idea is those donor agencies are not required to patronize it further. The tragedy was that the task force’s report was prevented by the newly elected government. Later on, based on this under CPD (Centre for Policy Research), we introduce policy reviews in 2001. The consideration is whether we are we overdoing or following recommendations of that task force or not. We connect the policymakers, private sectors and the stakeholders in policy issues. The public reasoning in addressing problems are very crucial. Research has limitations as it does not have any capacity to implement. Research organization can only do constant hammering to address the right issues.

Connecting people with research transforms the country and allows their voices to be heard. As a researcher, we should keep in mind the interest of the people and make a bridge of their interest with the policymakers. It is a task and commitment to the people. 

The Value of Research: KEY FINDINGS OF A NATION

‘Transitions between informal and formal employment’ by Minhaj Mahmud
· Workers transitioning from one job to another are most likely to remain in the same type of employment.
· 30% of those leaving private employment move to self-employment.
· Transition in employment is more common among prime-aged workers.
· Higher turnover among private wage employees may be an evidence of upward mobility.

The Heart of the Matter: How Internal Structures Create External Changes

Economic Affairs Adviser to the Prime Minister of Bangladesh

The inside story is essential for reaching a judgment. There is lack of using actuaries even in insurances sector. Correct data is required to make the right decisions. The condition of the Bureau of Statistics is very jarring due to lack of sound professionals.

Bangladesh achieved success but retaining the flow is a challenge. It requires knowledge-based administration and sharp implementation. The knowledge is not expanding at the expected level. On the contrary, there is no shortage of talents, but the missing link is organizations are not growing at the expected level, rather reversely going in a deviating way.

Much of the regulatory commission has been set up, but its legal power and authority are not defined. The commission should play an active role in determining the price of electricity, gas or mobile phones. However, that role is not clear.

There is still fundamental maladjustment in the tax administration, but the expenses of the government are rising. It also implies to raise revenue income, but that is not happening at the same speed. Investment and saving friendly policy is required to shoot up per capita income. As well as, rationalization of Tax policy is required to be addressed. It also implies that we need to improve our tax management and administration. 

The Role of Banks: Why Growth Starts with Sustainable Finance

Former Governor Bangladesh Bank

Bangladesh is doing well in export, and there is a possibility of doing more. Foreign investment will create competition and ushers a window of opportunity for marketing. A critical challenge of exports is economic policy and exchange rate of currency. The overvaluation of the currency of a country is self-defeating in perspective of export. Bangladesh is the second largest importer, and a significant thrust is required to raise investment in textiles that will lessen our import dependency. The zero tariff import for RMG (Ready Made Garments Industry) is no more accepted now.

The banking industry has expanded in Bangladesh over the years, but the capacity of the regulatory body Bangladesh Bank was not developed at the same rate. Today digitalization is a reality. Nevertheless, before adopting any technology there, the determining environment has to be considered. The Non-Performing Loan (NPL) situation is not as alarming as many other countries. It is not hard to solve the problem if there is a formula.

The Value of Research: KEY FINDINGS OF A NATION 

‘Labour Supply and its changes during 2006 to 2016: Focus on gender and regional difference’ by Md. Iqbal Hossain
· The youth are more interested in salaried jobs compared to self-employed ones, and this difference is more prevalent in females.
· Job market mismatch can reduce technical education.
· Remittance has a negative impact on female employment

‘Regional variations of Banking Services and Poverty Reduction: Evidence from Sub District Level Data of Bangladesh’ by Kazi Iqbal of BIDS, Paritosh K Roy, ISRT and Shamsul Alam of GED
· Deposit services have a strong negative association with poverty.
· Having a bank account itself can promote savings and income.
– The Anti-poverty program must include ‘financial inclusion.’

Connect Facilitators for a Progressive Economy

Lead Economist Macro Economic & Fiscal Management World Bank Dhaka Office

World Bank has Macroeconomic Models and Macro-Fiscal model. There is the presence of disagreement between the researchers and policymakers. It is a matter of perception, context, and evidence. Researchers state that policy makers are avoiding the policy implications of their research. Policymakers respond that their recommendations are inconclusive and they are speaking in their jargons.

The most important factor is typicality of policy in political context. Every country has public think tanks and a variety of private think tanks.The general assumptions are that the more the players, the better are the chances of research results. The feedback mechanism and the consultation process is also important. In Bangladesh’s fiscal policy, we have a pre-budget and post-budget consultation. There are pressure and interest group prevailing that matter the most.

Evidence-based policy is required. But there is a challenge if evidence is faulty or incomplete then depending on this, policy drawings will be wrong. In Bangladesh, there are problems with data. If data is not credible then inferring credible decisions are not possible.

The GDP Dialogue: How Much and Where to Invest

Dhaka Chamber of Commerce & Industry

Dhaka Chamber gave a vision strategy in 2010 known as ‘Bangladesh in 2030’; it stated that Bangladesh would be the 30th largest economy in 2030 and the 23rd largest economy in 2050. It also inferred that the GDP would be larger than that of Malaysia. South Korea has invested 9 % of their GDP in building infrastructure since 1960 whereas our investment in building infrastructure is only 2%. Now we are comparing ourselves with South Korea, Vietnam and China and wonder why they have developed faster than us?

Research should be market driven and should engage the private sector. We are meeting with different government components and various ministries. However, these discussions do not lead to desired products. In any policy design, the private sector must be engaged. The private sector is a part of the policy. In Vietnam and China, the private sector is conducting policy monitoring.

Dhaka Chamber proposed R&D Bangladesh which made public and private dialogue is a very successful model that can change the notion of policy design. We are also proposing a committee to monitor the large infrastructure projects. We want to create a platform to bring researchers and engage private sectors and like to involve the private universities. We are working to narrow down the research gap as the private sector is the primary stakeholder of the policy design, framework, and implementation.

The Value of Research: KEY FINDINGS OF A NATION 

‘Corporate Governance & Sustainability of the Global Value Chain: Bangladesh Readymade Garment Industry’ by Lilac Nachum, Nazeen Ahmed and Yoshiteru Uramoto
· International value creation and value appropriation in the global garment supply chain are primarily aligned with the shares created and appropriated by the manufacturers and leading firms and are on par with each other.
· Misalignment is found in value creation and value appropriation measured respectively by productivity and wages.
· To correct this distortion, a policy intervention, and outline of policy measures containing protecting of labor rights are required.
· The ability to create value in collaboration with partners in the supply chain is required.

‘Mobile Phones, Household Welfare and Women’s Empowerment: Evidence from Rural Off-grid Regions of Bangladesh’ by Monzur Hossain of BIDS and Hussain Samad of World Bank
· Mobile phones are enhancing income from livestock and poultry, fisheries, rental services and general business in off-grid rural areas in Bangladesh. It improves income by facilitating marketing of products, eliminating travel costs, and saving time.
· Phones are enhancing women empowerment–perhaps through income channel.

Think Tanks: The Driving Force Forward

DR. K.A.S. MURSHID Director General BIDS

Research papers have covered a broad spectrum of fundamental development issues time and again. A broader question that is addressed is the role of think tanks in today’s world. Think tanks have become a powerful knowledge and influence broker in many parts of the world. The Chinese have adopted a think tank strategy whereby all conceivable topics of research and analysis are sought to be encompassed by numerous think tanks at the national, regional and local levels. The urgent need is to minimize the gaps in policy and research is very important for going forward.

*Photo from PKSF

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