Challenges for Sustainable Development: Rapid Urbanization, Poverty and Capabilities in Bangladesh

The main purpose of this paper is to examine the causes and consequences -- in particular, the policy implications -- of the ongoing urbanization in Bangladesh. Like many other Asian developing countries, a rapidly increasing share of the population of Bangladesh migrates to urban centers in search for employment opportunities outside agriculture in industrial enterprises or the services sector. For the first time in its history, the urban population is growing faster than the rural population, At the same time, the labor force in non-agriculture is growing faster than the labor force in agriculture. But the employment opportunities in either sector are not growing adequately. This paper attempts to analyze the emerging trends and patterns of urbanization in Bangladesh within a dynamic dual-dual framework with a strong emphasis on rural-urban migration and the informal sectors. The analysis pinpoints, among other things, the need to build up productive capacities in order to create adequate employment and incomes for the rapidly growing population---particularly in the urban areas.The development of productive capacities, which is a precondition for the creation of productive employment opportunities, is a central element of viable poverty reduction strategy for Bangladesh as well. Without significant poverty reduction it is impossible to think of viable urbanization on the basis of sustainable development criteria in this poor country. Both for independent ecological reasons and for the implications of ecological damage for rising inequality and poverty, such a strategy must also be ecologically sustainable in the long run. The donors, especially the OECD/ DAC countries, should provide the necessary financial backing for such a sustainable and equitable development strategy for Bangladesh. It is necessary to reverse the trends in aid, and to provide a much larger share of aid for productive sector development, including the development of rural and urban areas, and the development of agricultural and non-agricultural sectors in line with the perspective of the dual-dual model. Although urban centers mostly host non-agricultural industries, sustainable urbanization also strongly depends on what happens in the agricultural sectors. Productive employment opportunities in rural areas are important in order to combat an unsustainable migration from rural areas to urban centers, and productive employment opportunities in urban centers are essential to absorb the rapidly increasing labor force in the non-agricultural sector.