During the liberation war country’s transportation and communications systems were totally disrupted. Roads were damaged, bridges were destroyed and inland waterways were blocked. In the last days of the war, West Pakistani-owned businesses—which included nearly every commercial enterprise in the country—remitted virtually all their funds to the West.
Pakistan International Airlines left exactly 117 rupees ($16) in its account at the port city of Chittagong. The army also destroyed bank notes and coins, so that many areas suffered from a severe shortage of ready cash. Private cars were picked up off the streets or confiscated from auto dealers and shipped to the West before the ports were closed. The politicians elected in 1970 formed the provisional parliament of the new state. The Mukti Bahini and other militias amalgamated to form a new Bangladesh Army.
Sheikh Mujibur Rahman described the fallout of the war as the "biggest human disaster in the world," claiming the deaths of as many as 3 million people and the rape of more than 200,000 women. Sheikh Mujib revived the Islamic Academy (which had been banned in 1972 for suspected collusion with Pakistani forces) and banned the production and sale of alcohol and banned the practice of gambling, which had been one of the major demands of Islamic groups. He gave charge to the provisional parliament to write a new constitution, and proclaimed the four fundamental principles of "nationalism, secularism, democracy, and socialism. Mujib nationalised hundreds of industries and companies and initiated land reform aimed at helping millions of poor farmers. A constitution was proclaimed in 1973 and elections were held, which resulted in Mujib and his party gaining power with an absolute majority. He further outlined state programs to expand primary education, sanitation, food, healthcare, water and electric supply across the country.
The Mujib government faced serious challenges, which including the rehabilitation of millions of people displaced in 1971, organising the supply of food, health aids and other necessities. The effects of the 1970 cyclone had not worn off, and the state's economy had immensely deteriorated by the conflict. Economically, Mujib embarked on a huge nationalization program. By the end of the year, thousands of Bengalis arrived from Pakistan, and thousands of non-Bengalis migrated to Pakistan; and yet many thousand remained in refugee camps. Major efforts were launched to rehabilitate an estimated 10 million refugees. The economy began recovering and a famine was prevented. A five-year plan released in 1973 focused state investments into agriculture, rural infrastructure and cottage industries.