Amidst ongoing protests and a nationwide curfew, Bangladesh has been grappling with severe economic repercussions, exacerbated by an internet blackout. The country’s vital garment export sector, among others, has been hit particularly hard, resulting in an estimated $1.2 billion revenue loss over the past five days.
Since July 23, 2024, the streets of Dhaka and Chattogram have been under heavy surveillance, with armoured vehicles patrolling to enforce the curfew imposed by the government. This drastic measure follows violent clashes during protests against a controversial quota system for government jobs, which initially set aside 30 percent of positions for descendants of those who fought in the 1971 War of Independence. Despite the Supreme Court's decision to scale back these quotas, unrest continues as students demand justice for those killed in the violence, leading to further disruptions.
Industry leaders, recognizing the dire economic impact, have made urgent appeals to Prime Minister Sheikh Hasina. They have requested the lifting of the curfew and restoration of internet services to stabilize the economy and safeguard essential operations along the Dhaka-Chattogram highway. This highway is a crucial economic artery, linking the capital with the country's main port city.
Prime Minister Hasina has acknowledged these concerns, explaining that the curfew and army deployment were necessary to protect lives and property. She assured business leaders that the curfew would be gradually relaxed. However, for millions of workers and thousands of businesses, this gradual approach may not suffice to avert long-term damage.
The readymade garment sector, which constitutes over 80 percent of Bangladesh's export earnings, has suffered the most significant blow. Factories have been closed since the onset of the curfew, leading to daily losses estimated at $150 million. SM Mannan Kochi, president of the Bangladesh Garment Manufacturers and Exporters Association, emphasized that international buyers' confidence is waning, posing a long-term threat to the industry.
Other sectors, including steel, pharmaceuticals, and ceramics, have also reported substantial losses. Steelmakers have incurred an estimated $110 million loss in four days, as raw materials remain stuck at ports. The pharmaceutical industry is facing severe production disruptions due to import clearance delays, impacting the availability of essential medicines. The ceramics industry, experiencing an $8 million daily loss in export orders, adds to the mounting economic strain.
The internet blackout, initiated on Thursday night, has compounded these challenges. E-commerce and f-commerce, crucial components of Bangladesh's digital economy, are losing at least $5 million per day. Shahab Uddin, vice president of the E-commerce Association of Bangladesh, highlighted the struggle faced by city residents accustomed to online shopping for daily needs. The call centre industry, integral to global business services, faces irreparable reputational damage and daily losses of $3 million, according to Wahid Sharif, president of the Bangladesh Association of Contact Centres and Outsourcing.
Commercial banks are preparing for potential financial penalties arising from delayed payments caused by the recent blackout. Zunaid Ahmed Palak, the state minister for information and communication technology, has acknowledged the significant financial impact of the blackout and has reassured the public that measures are being taken to restore connectivity as soon as possible.
As Bangladesh grapples with the challenges brought about by the current situation, it's crucial to recognize the far-reaching economic consequences of the curfew and internet blackout. These measures highlight the intricate interplay between upholding public order and safeguarding economic prosperity. The government's actions and the promptness of reinstating normal conditions will play a pivotal role in minimizing enduring repercussions and upholding the trust of global partners in Bangladesh's economic resilience.