An advocacy for encouraging youth entrepreneurship in Bangladesh

I remember having a conversation with a group of students who were enrolled at a local university. When asked about their career aspirations, a guy in the crowd mentioned that he is studying so that he can get a “good job”. During the conversation he also mentioned that his female classmates only study so that they can get married to a “good guy”. 

Unfortunately, this seems to be the general aspiration for studies in Bangladesh.The sole purpose to go to an education institute is to get a certificate. The quest for learning and being productive labor is secondary. A degree enables one to apply for a “good job”. The preferred form of employment is a permanent position with the government.  This norm is hammered on the youth by family and society. Essentially, this is due to job security. However, this groupthink mentality causes economical as well as social problems. From an economic stand point, young people are now dependent on the state for their livelihood. Again, from a social perspective, young people depend on the state too much and it curtails youth leadership. 

On the contrary, as opposed to seeking a “good job”, if young people engage in entrepreneurship, they can not only provide for themselves, but also support a few families by generating employment. Again, via entrepreneurship they can solve a problem, or, meet a need in the local community. For example, the ride sharing business “Pathao”, is not only a source of income generation for many people, but also helpful to those who want to navigate quickly through the chaotic Dhaka traffic.

Furthermore, the mindset of dependency on the state can have some of the fallouts that are seen in some rentier states. Here, young people expect the state to support them irrespective of their contribution to the economy. Due to scarcity of resources this is not a sustainable approach for economic growth for the young segment of the population. It also means that there is inadequate motivation for young citizens to be productive.  

Rentier state means a country that receives substantial amounts of oil or other types of revenues from the outside world on a regular basis. It is independent from its society, unaccountable to its citizens, and autocratic. For instance, countries such as Iran, the Gulf States, many African states like Nigeria, Gabon with abundant resource wealth are called rentier. A rentier state and rentier economy contributes to a rentier mentality, which adversely affects a country’s economy and long-term prospects.

Bangladesh has a bulging graph when it comes to youth population. According to UNFPA (United Nations Population Fund), as of 2017, young people between the ages of 15-24 years make up nearly 20% of the population. However, the country is not capitalizing on the “demographic dividend”. As per the ILO (International Labor Organization), as of 2017, the share of youth from within the total youth population in the country who are neither in education, nor in employment or training (NEET) is 27.4 %. 

This shows that country is not enriching its young human resources. Young people are not being transformed into assets for development. The country is not capitalizing on the demographic dividend. In a sense, a “precariat” segment of population is in place.  

SOAS (School of Oriental and African Studies) of the University of London, Professor Guy Standing describes a fragmented yet connected network of “the precariat”: a fast-growing global socio-political group that share an increasingly precarious lack of job security, with a fragmentation along class lines being drawn up within professions themselves, as opposed to certain professions belonging to classes.

Under the prevailing circumstances, young people in Bangladesh who want to engage in entrepreneurship face some challenges. One is institutional and the other is social.

The institutional limitations can be highlighted by some recognized and accepted global rankings. The GII (Global Innovation Index) compiled by World Intellectual Property Organization, Cornell University and INSEAD ranks Bangladesh 116 out of 129 countries in 2019. Also, the “Ease of Doing Business 2019” complied by World Bank puts Bangladesh at 176 out of 190 countries. Therefore, youth are demotivated to engage in business. 

Again, the social limitations can be highlighted in the “cultural milieu”. A featured example is in my conversation with those students. One of the guys mentioned that upon graduation if he engages in business it will be difficult for him to get married. He cited the reason that when he mentions to his prospective in laws that he is engaged in business, they would assume that he is unemployed. The social stigma for entrepreneurship is very apparent.

Cultural milieu refers to the setting and environment in which a person lives, including social and cultural aspects of life.

The young man also concluded that one should engage in business only after a few years of employment experience. He further reasoned that this is because if one is older, people would respect him more and it would be easier to negotiate deals. Thus, age stratification in culture can be a perceived barrier for youth entrepreneurship.

Age stratification is the segmentation between age cohorts due to an unequal distribution of resources (e.g., wealth, power, and privilege) across the life course.

In order to change the established predicament and engage youth in entrepreneurship ventures an integrated approach is required. This means both institutional changes as well as SBC (social behavioral change).

Institutional support could include but not be limited to accelerators and incubators. Again, SCB could include but not be limited to well-crafted message through social media advertising. However, such undertakings are already in place. Although it is still a relative urban privilege and there is limited synergy among the incentives.  Therefore we do not see maximized output. The consequence of this is reflected in rankings. The Global Competitive Report 2019: ‘How to end a lost decade of productivity growth’ ranks Bangladesh 105 out of 141 economies. 

Bangladesh had taken incentives to promote its agenda. For example, the Income Tax Ordinance-1984, states that female taxpayers enjoy a higher annual tax-free limit of BDT 300,000 compared to BDT 250,000 for their male counterparts. This is one of the many reasons that has positively discriminated women and enabled and empowered them. A similar drive by the state to encourage startups ventures should be undertaken by youth entrepreneurs. Only then a robust entrepreneurial ecosystem would be created. This will result in an inflow of capital migration, an increase in GDP (gross domestic product) among other positive outcomes.

Mohammed Tanvir Mosharraf is an occasional contributor