How Has Bangladesh Left Pakistan Behind in Per Capita Income?

[Mage]

I gave you IMF and world bank sources . If you donot have any source than this is redundant . Or maybe you should wait for them to update Pakistan's per capita before you start your pre mature ecelebrations again like always .

https://www.google.com/amp/www.brecorder.com/2017/05/25/350500/per-capita-income-rises-to-1629/amp/

$1629 for 2017

If i were you I would wait for IMF or world bank to update before claiming anything .

It has been reported many places. YOu think they are just posting false stuff because they don't like Pakistan? Just do the math of division, total gdp/total population

Lets do it with the information available.

Pakistan GDP of 2016 is 284B
Population in 2017 is 207M.
GDP per capita 1372$.

BD GDP of 2016 is 246B
Population in 2017 is 170M.
GDP per Capita 1447$.

Here I'm applying 2016 GDP for both Pak and BD. And 2017 population for both. So can't call it biased in any way.


According the estimates Pakistan's GDP size in 2017 is 304B.
Population 207M.
Resulting GDP per Capita of 1470$

For BD the GDP size in 2017 is 267B.
Population 170M.
Thus GDP per Capita 1570$.

I'm sorry to disappoint you but all the numbers indicate that BD has edged past Pakistan. And BD is gonna stay ahead for some time.

 

[Khan_21]

It has been reported many places. YOu think they are just posting false stuff because they don't like Pakistan? Just do the math of division, total gdp/total population

Lets do it with the information available.

Pakistan GDP of 2016 is 284B
Population in 2017 is 207M.
GDP per capita 1372$.

BD GDP of 2016 is 246B
Population in 2017 is 170M.
GDP per Capita 1447$.

Here I'm applying 2016 GDP for both Pak and BD. And 2017 population for both. So can't call it biased in any way.


According the estimates Pakistan's GDP size in 2017 is 304B.
Population 207M.
Resulting GDP per Capita of 1470$

For BD the GDP size in 2017 is 262B.
Population 170M.
This GDP per Capita 1538$.

I'm sorry to disappoint you but all the numbers indicate that BD has edged past Pakistan. And BD is gonna stay ahead for some time.

Sure if it makes you sleep well at night . Untill then I will wait for IMF or world bank for 2017 figures

 

[Nilgiri]

BD is planning a base year too. We're still using 2005-6 base year. When it is moved to 2015-16 you'll see per capita incomes making a jump too. Considering that BD's nominal per capita according to latest IMF reports have increased to 90% of India's and India is using 11-12 base year BD's nominal GDP might actually get very close or even ahead of India's.

Won't happen (to degree you are thinking). BD is very much more a single industry kind of (export dependent) economy compared to even Pakistan, forget India. This means much much less in BD is hidden from US dollar exchange rate (also similar reason why %wise BD realised more of its PPP into nominal compared to India and Pakistan). Countries that get highest rebasing effect normally have large increases in their stock market total cap and also indices in the time period in question. BD simply has not experienced the same here that Pakistan and India have, especially if you look at the types of companies that made the most gains in all of them and how that relates to the base year snapshot composition.

Also Per capita in nominal (as useless and irrelevant the concept is in the first place to consumption and socioeconomic development esp when its below 5k threshold ), you are more like 80% of India, not 90%:

http://www.imf.org/external/pubs/ft/weo/2017/01/weodata/weorept.aspx?pr.x=20&pr.y=10&sy=2015&ey=2022&scsm=1&ssd=1&sort=country&ds=.&br=1&c=513,534&s=NGDPDPC&grp=0&a=

 

[Major Sam]

It has been reported many places. YOu think they are just posting false stuff because they don't like Pakistan? Just do the math of division, total gdp/total population

Lets do it with the information available.

Pakistan GDP of 2016 is 284B
Population in 2017 is 207M.
GDP per capita 1372$.

BD GDP of 2016 is 246B
Population in 2017 is 170M.
GDP per Capita 1447$.

Here I'm applying 2016 GDP for both Pak and BD. And 2017 population for both. So can't call it biased in any way.


According the estimates Pakistan's GDP size in 2017 is 304B.
Population 207M.
Resulting GDP per Capita of 1470$

For BD the GDP size in 2017 is 267B.
Population 170M.
Thus GDP per Capita 1570$.

I'm sorry to disappoint you but all the numbers indicate that BD has edged past Pakistan. And BD is gonna stay ahead for some time.

Let me enlighten you one thing 207 m includes all illegals and registered refugees,

 

[MultaniGuy]

Agreed with Khan_21, I will wait for the IMF and World Bank figures.
Till then I am going with the 2016 figures, and in that Pakistan is ahead of Bangladesh in GDP per Capita.

 

[That Guy]

No. It won't. BD's growing much faster than Pakistan. If you subtract Pakistan's population growth from GDP growth you will see that Pakistan is growing very slow in terms of per capita.
The difference is only going to increase in 5 years. 10 years ago Pakistan's nominal per capita was twice as much of BD's. Now BD has edged ahead in last 10 years. And BD is going to grow even faster in the next 10 years according to every estimates. So you're not catching up. Not anytime soon.

Misleading at best. What do you think has been happening for the last 2ish decades, within Pakistan?

Besides, BD's economy is actually set to slow down, while Pakistan's is set to grow by an average of 6-7% over the next decade. Not to mention, once Paksitan revises its base year, it's GDP numbers should experience a significant boost, as the current numbers are grossly under representative of Pakistan's current economy.

Again, BD's per capita is only artificially higher.

 

[Mage]

Also Per capita in nominal (as useless and irrelevant the concept is in the first place to consumption and socioeconomic development esp when its below 5k threshold ), you are more like 80% of India, not 90%:

I thought India's per capita was 1723$.

Won't happen (to degree you are thinking). BD is very much more a single industry kind of (export dependent) economy compared to even Pakistan, forget India. This means much much less in BD is hidden from US dollar exchange rate (also similar reason why %wise BD realised more of its PPP into nominal compared to India and Pakistan). Countries that get highest rebasing effect normally have large increases in their stock market total cap and also indices in the time period in question. BD simply has not experienced the same here that Pakistan and India have, especially if you look at the types of companies that made the most gains in all of them and how that relates to the base year snapshot composition.

Well base year shift is supposed to increase the GDP by at least 25%.............I'm not sure what would it do to India and Pakistan. India changes base year in every 5 years. So their increase should be lower?

Let me enlighten you one thing 207 m includes all illegals and registered refugees,

They are part of your economy.

Besides, BD's economy is actually set to slow down,

Who told you that? Actually it will grow even faster in the next decade with major infra projects being completed. Padma bridge alone is supposed to increase the growth rate by 1% as it will connect 21 districts with the capital. BD's export is growing and although very slowly but it is being diversified as well where Pakistan's export is decreasing.

once Paksitan revises its base year, it's GDP numbers should experience a significant boost

Like I said BD is also due a base year shift.

as the current numbers are grossly under representative of Pakistan's current economy.

Again, BD's per capita is only artificially higher.

You wish.

 

[Chak Bamu]

Interesting conversation and good quality posts from venerable @RiazHaq & also @Nilgiri

I view Pakistan's problem as a political one, whereby the decision-making is seriously compromised because of competing interests. What we see currently unfolding in Pakistan is the classic Civ-Mil tussle that has been the bane of Pakistan since '50s. After having worked in textile manufacturing for many years, I am currently working in Retail, at Head Office of one of the largest retail networks in Pakistan. I can not overstate how the political instability - mostly induced - plays havoc with economy. Consumer-driven economic activity is sentiment-based. Cynicism & pessimism negatively affects an economy, while optimism buoys it. Take a look around in Pakistan. Cynicism sells and many political players are doing a good job of encashing it. To me, that makes a big difference. Pakistanis have a phenomenal ability to face and out-last adversity. But that strength seems to be sapped by loud rhetoric that aims at preserving entrenched power structures.

Bangladeshi nation has found a way to protect its core economic interests from occasional instability. Garment industry provides incentives and proactively anticipates how a 'hortal' may affect their production and ability to meet export orders. Political parties too are mind-ful of not hurting export of textiles. I am quite sure that Chittagong does not have a MQM style extortionist party. The military too does not actively play politics. There is no Indian-sponsored instability in Bangladesh. There is general peace and stability and foreign buyers like to place orders in Bangladesh. With all these factors working in Bangladesh's favor, it is no accident that Bangladesh beats Pakistan in GDP growth, Exports, Human-Development Indicators, & perception.

Pakistan on the other hand is marred by obsession with security, weak governments (even when they come in with big majorities), civ-mil tussle, agencies that operate without any civilian over-sight, terrorism, perception of poor law & order, in addition to all other issues pointed out by other posters.

China, India, and Bangladesh have grown despite pervasive corruption. Pakistan could too. But then corruption is an excuse to beat civilian governments. The civilian faces driving the anti-corruption campaign are themselves compromised and look to the military for favors. The day civilians achieve ascendancy would be a good day for Pakistan. Security mind-set inevitably weakens the nation while strengthening the state. Pakistan has just about had enough of it by now. Pakistan needs to set its house in order, find ways to make peace with neighbors, & focus on internal development.

 

[Mage]

Interesting conversation and good quality posts from venerable @RiazHaq & also @Nilgiri

I view Pakistan's problem as a political one, whereby the decision-making is seriously compromised because of competing interests. What we see currently unfolding in Pakistan is the classic Civ-Mil tussle that has been the bane of Pakistan since '50s. After having worked in textile manufacturing for many years, I am currently working in Retail, at Head Office of one of the largest retail networks in Pakistan. I can not overstate how the political instability - mostly induced - plays havoc with economy. Consumer-driven economic activity is sentiment-based. Cynicism & pessimism negatively affects an economy, while optimism buoys it. Take a look around in Pakistan. Cynicism sells and many political players are doing a good job of encashing it. To me, that makes a big difference. Pakistanis have a phenomenal ability to face and out-last adversity. But that strength seems to be sapped by loud rhetoric that aims at preserving entrenched power structures.

Bangladeshi nation has found a way to protect its core economic interests from occasional instability. Garment industry provides incentives and proactively anticipates how a 'hortal' may affect their production and ability to meet export orders. Political parties too are mind-ful of not hurting export of textiles. I am quite sure that Chittagong does not have a MQM style extortionist party. The military too does not actively play politics. There is no Indian-sponsored instability in Bangladesh. There is general peace and stability and foreign buyers like to place orders in Bangladesh. With all these factors working in Bangladesh's favor, it is no accident that Bangladesh beats Pakistan in GDP growth, Exports, Human-Development Indicators, & perception.

Pakistan on the other hand is marred by obsession with security, weak governments (even when they come in with big majorities), civ-mil tussle, agencies that operate without any civilian over-sight, terrorism, perception of poor law & order, in addition to all other issues pointed out by other posters.

China, India, and Bangladesh have grown despite pervasive corruption. Pakistan could too. But then corruption is an excuse to beat civilian governments. The civilian faces driving the anti-corruption campaign are themselves compromised and look to the military for favors. The day civilians achieve ascendancy would be a good day for Pakistan. Security mind-set inevitably weakens the nation while strengthening the state. Pakistan has just about had enough of it by now. Pakistan needs to set its house in order, find ways to make peace with neighbors, & focus on internal development.

Well said sir.

 

[paritosh]

Simple logic. You have more people to generate wealth.

when you take per capita figures, the numbers lose significance

 

[Nilgiri]

Let me enlighten you one thing 207 m includes all illegals and registered refugees,

And BD census does not include their accumulated illegal people export (though it has dropped in recent years as their economy improves and their neighbours have improved their border security)....their population is probably 10 - 20+ million more people if those are included.

But census per se can only count total residents, not citizens...so I don't blame concept of census even in BD....and it is still useful info.

Also GDP only cares about resident population within a political border and all production (regardless of ownership) that takes place within that border. GNP is the citizen specific one (and citizens are spread within the country border and also outside it).

 

[Nilgiri]

I thought India's per capita was 1723$.

I'm quoting off the IMF figures at WEO...comparing year to year. Its holding steady at 80 - 83% (BD/IND nominal USD per capita) right now and projected to hold there till 2022 according to IMF.

Well base year shift is supposed to increase the GDP by at least 25%

From where did you get that threshold? I need a source/study on it. There is no guarantee on GDP increase by base year shift at all. Yes it is more likely with developing countries overall (but certainly wouldn't give an X% at least number) but there need to be some marker of greater formalisation + new production sector expansion clearly manifesting (that isnt captured by old base). Hence I bring up the stock market as a correlator for this. From what I have seen of the Dhaka SE, its mostly market cap expansion of largely existing traditional stuff (even considering the base is now 10+ years old)...which will not push/drive GDP in a re-basing (given it was largely captured in old base) to the extent you are hoping for. Actual change in composition weight of the GDP by changes in relevance/presence of the more traditional industries can definitely be another factor that pushes GDP in rebasing....but again its not guaranteed one but I will admit I have not looked too much into it in BD's case.

In the end, we can see for ourselves though when it happens. Larger potential "propellant" for GDP in comparison is if BD submits to SNA 2008 GVA based accounting (though again nothing guaranteed) given it samples more broadly and more simply....also SNA 2008 requires re-basing every 5 years so BD will have to develop much better institutional capacity for that which will improve its estimates each year.

Again the aim should not be to care about inflate/deflate GDP but getting better GDP estimate period.

I'm not sure what would it do to India and Pakistan. India changes base year in every 5 years. So their increase should be lower?

It would need a huge analysis to determine this in some predictive way (through my proposed correlated method of using stock market, both using sheer market cap increase and composition of market cap increase). I go largely by what my closest real life BD friend has told about Bangladesh stocks in general regarding their composition. Yes there are new players reflecting completely "new" industries (that would give an X value compared to 0 value before through a rebasing), but the real drivers remain traditional economy...and have they really changed in their % make up of GDP relative to each other from 2005/06 and today? It needs indepth study, and probably its just easier waiting for re-basing to occur in BD given severe lack of much internal info on BD economy.

As for sheer market cap, India and Pakistan have expanded much greater in raw and % terms compared to BD, be it from level in 2006 or from 2011 (when I believe BD hit its index peak and then declined for quite some time till it recovered somewhat more recently)....same for their overall indices. Pakistan listed market cap is around 100 billion USD right now, BD around half that....and most of Pakistan's index rally happened in last few years too unlike BD which is largely recovery of index from the 2011 peak....suggesting (without looking into huge detail) market cap increase in BD is largely traditional industry based (not a huge driver for re-basing effect of GDP). The overall realised gradients are quite telling too:

Of course if there is a composition (of total and indexed listed companies sector wise) pie chart for Dhaka SE compared to Karachi SE regarding the base year in play today compared to current situation/X years ago situation (for new proposed base year)....someone can post those here and we can analyse the potential role in that w.r.t re-basing probably more accurately. I got no time to find all that myself tbh.

 

[Major Sam]

I'm quoting off the IMF figures at WEO...comparing year to year. Its holding steady at 80 - 83% (BD/IND nominal USD per capita) right now and projected to hold there till 2022 according to IMF.



From where did you get that threshold? I need a source/study on it. There is no guarantee on GDP increase by base year shift at all. Yes it is more likely with developing countries overall (but certainly wouldn't give an X% at least number) but there need to be some marker of greater formalisation + new production sector expansion clearly manifesting (that isnt captured by old base). Hence I bring up the stock market as a correlator for this. From what I have seen of the Dhaka SE, its mostly market cap expansion of largely existing traditional stuff (even considering the base is now 10+ years old)...which will not push/drive GDP in a re-basing (given it was largely captured in old base) to the extent you are hoping for. Actual change in composition weight of the GDP by changes in relevance/presence of the more traditional industries can definitely be another factor that pushes GDP in rebasing....but again its not guaranteed one but I will admit I have not looked too much into it in BD's case.

In the end, we can see for ourselves though when it happens. Larger potential "propellant" for GDP in comparison is if BD submits to SNA 2008 GVA based accounting (though again nothing guaranteed) given it samples more broadly and more simply....also SNA 2008 requires re-basing every 5 years so BD will have to develop much better institutional capacity for that which will improve its estimates each year.

Again the aim should not be to care about inflate/deflate GDP but getting better GDP estimate period.



It would need a huge analysis to determine this in some predictive way (through my proposed correlated method of using stock market, both using sheer market cap increase and composition of market cap increase). I go largely by what my closest real life BD friend has told about Bangladesh stocks in general regarding their composition. Yes there are new players reflecting completely "new" industries (that would give an X value compared to 0 value before through a rebasing), but the real drivers remain traditional economy...and have they really changed in their % make up of GDP relative to each other from 2005/06 and today? It needs indepth study, and probably its just easier waiting for re-basing to occur in BD given severe lack of much internal info on BD economy.

As for sheer market cap, India and Pakistan have expanded much greater in raw and % terms compared to BD, be it from level in 2006 or from 2011 (when I believe BD hit its index peak and then declined for quite some time till it recovered somewhat more recently)....same for their overall indices. Pakistan listed market cap is around 100 billion USD right now, BD around half that....and most of Pakistan's index rally happened in last few years too unlike BD which is largely recovery of index from the 2011 peak....suggesting (without looking into huge detail) market cap increase in BD is largely traditional industry based (not a huge driver for re-basing effect of GDP). The overall realised gradients are quite telling too:

Of course if there is a composition (of total and indexed listed companies sector wise) pie chart for Dhaka SE compared to Karachi SE regarding the base year in play today compared to current situation/X years ago situation (for new proposed base year)....someone can post those here and we can analyse the potential role in that w.r.t re-basing probably more accurately. I got no time to find all that myself tbh.

In KSE biggers sectors are from cement, oil and gas, banking, fertilizers and construction.

This list is for awards winner of 2015 top companies in KSE.

 

[Nilgiri]

In KSE biggers sectors are from cement, oil and gas, banking, fertilizers and construction.

This list is for awards winner of 2015 top companies in KSE.

1) Fauji Fertiliser Company Limited 2) Millat Tractors Limited

3) Nestle Pakistan Limited 4) Pakistan Oilfields Limited

5) Pakistan International Container Terminal Ltd 6) Service Industries Limited

7) Fauji Fertiliser Bin Qasim Limited 8) Dawood Hercules Corporation Limited

9) Bata Pakistan Limited 10) Indus Motor Company Limited

11) Arif Habib Limited 12) Colgate - Palmolive (Pakistan) Limited

13) Bank AL Habib Limited 14) Security Papers Limited

15) Dawood Lawrencepur Limited 16) Attock Petroleum Limited

17) Thal Limited 18) United Bank Limited

19) Attock Cement Pakistan Limited 20) Hinopak Motors Limited

21) Biafo Industries Limited 22) Habib Bank Limited

23) Atlas Honda Limited 24) National Foods Limited

25) Atlas Battery Limited

Need more details about exact numbers, like how much % (by total market cap value especially) were in cement etc...across the years going back to base year currently...and then these numbers would be especially important for industries that had say 0 presence before and have some X presence today.

This would effectively be some portion of what the actual re-basing effort by govts do I would imagine (though they would sample/analyse much more than just stock market). But doing just stock market alone would be great indicator I think because it is where the most hotly traded (and thus accesible and more readily deployed + quality) liquidity is done....and the raw data is also much more simple and readily available too.

 

[Kaniska]

To Indian posters here...Do we really need to counter everything that is somehow positive about Pakistan??..Even if in our views it is differe than the thread, we can be observer only rather than dragging India into all discussions.