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Pandemic creates 2.45cr new poor

BANGLADESH (The Daily Star/ANN) The economic shock induced by the pandemic has pushed 2.45 crore people  - 14.75 percent of the country’s population - into poverty in one year, according to a new survey.

A road in the capital’s Karwan Bazar area is crammed with sellers and buyers as they flout health safety rules. Violation of lockdown restrictions continues in the city amid the surge in coronavirus infections.    -Photo Anisur Rahman

The survey found that the pandemic caused a significant depletion of households’ income and forced a large number of the population into leaving cities and taking shelter in their village homes.
Those people had to head home as they became jobless. Their situation was worsened by rising living expenses, dwindling savings and mounting debt, said the survey.
The Power and Participation Research Centre (PPRC) and the Brac Institute of Governance and Development (BIGD) came up with the findings at a virtual press conference on Tuesday.
“It is thought that the ‘new poor’ is a temporary matter. But one year after the pandemic, we see that a large number of the people, who went below the poverty line [due to the pandemic], are yet to come out of poverty,” PPRC Executive Chairman Hossain Zillur Rahman said at the briefing.
It is the third study by the PPRC and the BIGD on the coronavirus’ impact on people’s income and poverty. For this, Rapid Response Research (RRR) of the two organisations carried out a panel survey in March on over 6,000 people living in rural and urban slums.
In its first survey, on a similar number of households in slums, in April last year, the RRR found that around 3.7 crore people or 22 percent of the population became the “new poor” due to the first wave of the pandemic. It meant that they joined the previous 20.5 percent of the population who had already been poor.
The PPRC and the BIGD said over the last one year, a portion of the new poor was able to come out of poverty. Around 2.45 crore still suffer in poverty, they said.
“People have lost their capacity to face the pandemic and recover from the economic consequences of it. Income of households decreased while their debt kept going up,” Zillur said while talking to The Daily Star later in the day.
The findings of the latest survey gives an indication that a large number of people are still struggling to lead their life smoothly, said Zillur, also an adviser to a former interim government.
“In order to protect the lives and livelihoods of people, we must avoid the economic shock we faced last year,” he said.
“The impact of the ongoing economic hardship will deepen many folds if the country faces a similar shock this time,” he said.
A smart Covid-19 lockdown can help in this case, but the authorities have to make sure that people’s lives and livelihoods as well as health protocols are ensured simultaneously, he commented.
Participants at the briefing said the country was currently facing the second wave of the coronavirus pandemic amid incomplete, fragile economic recovery and a significant depletion of household incomes, which ultimately worsened people’s capacity to fight Covid-19.
The survey also found that the rate of extreme poverty went up by 4 percent in March this year from February.
The consequence of the pandemic has had an adverse impact on the poor in urban areas as their per capita daily income declined to Tk 107 from Tk 124.
But the income of rural people increased to Tk 108 from Tk 106.
The rural economy has rebounded strongly sidestepping the economic hardship based on the good performance of the farm sector.
The survey also found that 27.3 percent of urban slum dwellers migrated from the major cities to villages after the arrival of the pandemic. Some 9.8 of the people are yet to return, it said.
In addition, the migration has not stopped till date as 6.8 percent of the people left urban areas since June last year.
Imran Matin, executive director of the BIGD, said the savings of the people have decreased largely at a time when they are burdened with huge debts.
Savings of each urban slum household stood at Tk 16,707 in March this year, down 11 percent from February last year, he said.
Reserves by people in rural areas also declined 24 percent in the last one year.
The amount of loans taken out per household in the city areas stood at Tk 42,961 in March this year, up 86 percent from February last year.


(Latest Update April 22, 2021)

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