A journey from eden building to motijheel

Sunday, November 6, 2016 http://dailyasianage.com/news/36773/a-journey-from-eden-building-to-motijheel

A journey from Eden Building to Motijheel M S Siddiqui

Bangladesh became independent after long liberation movement and followed by a civil war against Pakistani Army. The economy has been affected by the war and the worst hit areas were its trade, industry and commerce. The left enterprises of Pakistani owners were in a completely shattered condition.

In 1971 the statistics was very dismal. The than East Pakistan Industrial Development Corporation (EPIDC) Ownership 53 (34%), Private Ownership (Non-Bangaldeshi) 725 (47%) and Private Ownership (Bengali) 2253 (18%) and the Private Ownership (Foreign) 20 (1%).

EPIDC was a state-own entrepreneurship development corporation created by Pakistan government to promote entrepreneurship at the primitive state of economy of Pakistan.

The business establishments, which were owned by the Bangladeshis, were small enterprises.

The value of the enterprises under ownership of Bangladeshis was made up only 18% of the total value of the entire industrial sector and commercial enterprises.

The government had took over the management of enterprises under EPIDC, abandon industries of Non-Bangladeshi owners and all heavy industries including Bank, insurance etc. on December 16, 1971 the Government of Bangladesh assumed control of the country.

In case of small enterprises under ownership of Non-Bangladeshi , who left the country before liberation, the government found itself compelled to undertake the responsibility. Subsequently, the political will of state ownership has been reflected in the constitution within the four basic principles, namely Nationalism, Democracy, Socialism and Secularism.

There were over 400 manufacturing enterprises in the public sector, comprising nearly 85 percent of all assets in industrial enterprises under government management.

These industries were given under the control of the Ministry of Industries. In order to well manage, government formed ten new sector corporations, which are in the nature of holding companies responsible for the management of the Government-owned units within each sector.

These sector corporations took over management of jute; cotton textiles; sugar; food and allied products; fertilizers, chemicals and pharmaceuticals; oil, gas and minerals; paper; steel; engineering and shipbuilding; and forest industries.

Government also took over Bengali-owned jute, cotton textile and sugar mills with assets of more than Tk. 1.5 million. The economy came under state control and the management vested with bureaucrats, who have no-experience of running the enterprises.

The history of bureaucracy has an interesting legacy from era of British East India Company.

They were private sector bureaucrats to run the business. But the history was very different. The Queen of England given permission to four British companies to expand business throughout the world and the East India Company (EIC) has given responsibility of South Asia and South East Asia.

These companies had their own army and gradually take the political control over the world though war, diplomacy and purchase of properties. The EIC virtually took over the rule of Bangla and Bihar in 1757 with fall of Nawab Siraj ud Daulah after historical war of Palashi and consolidated its position as a dominant power in India by 1784. EIC has gradually changed the administrative system. The business executives of company changed from merchants to that of statesmen, from traders to governors, judges and magistrates.

After the Shepahi Mutiny of 1757, the British government annexed South Asia and created a corps of specially talented officers, - selected from the Commercial services as well as army and entrusted them with the pioneering task of settling existing and newly conquered areas, making political adjustments, restoring law and order, assessment and collection of land revenue, administration of criminal and civil justice, maintenance of roads and bridges, digging canals, opening schools and hospitals in order to gain the confidence of people. After the 1947, the Pakistan has created a civil service but the mentality of official was legacy of British period. The bureaucracy of Bangladesh formed with the few officials ex-services of Pakistan with British ruler mentality.

In the theory of Socialism, the state ownership understands to be community ownership that mean owned by and managed and controlled for the community. The nationalization became the take over the management of these enterprises by defeating the ideology of state-ownership of

economic activities and vested to bureaucracy.

This has been observed in all the developing countries and in most of the developed ones, a large number of State Owned Enterprises (SOEs) ultimately became financially inefficient and incurred heavy losses. Since their very inception the SOEs in Bangladesh were plagued by inefficiency, mismanagement, heavy losses and similar other shortcomings.

These state companies got bank credit under "state guarantee" and recommendation of the government and enjoy disproportionate shares of domestic credit with private sector. These lossmaking SOEs and Banks are supported by special funds in the budget for their survival.

Government has earmarked Tk 5,000 crores in the national budget of 2016-17 only for ailing public sector Banks, while the private sector bank earning hefty profit in the same market. The nationalized sector in other countries also has similar fate like Bangladesh.

In 1993, public sector incurred losses to the tune of Tk. 25 billion. This amount represents about 50% of the annual project aid disbursement and nearly 2% of the GDP. Government could not rescue the ailing SOEs investing money in the form of capital infusions or as subsidies and/or write-off of bad debts. The government has no other choice to disinvest the SOEs. The service sectors were under state control since the beginning and Bangladesh still has a large number of public enterprises (grouped under 38 corporations) in operation. The SOEs dominate many important sectors. They accounted for 71% of the value added in the utilities (power, gas and water), nearly 100% in railway and communications. By this time, the power generation has been partially allowed in the private sector. The Banking and insurance sectors opened up the private investment but still dominated by public sector through patronization of government.

In 1947 the country Pakistan start journey with Eden building was the center of power. The Eden Building (the Secretariat) became power-centre due to authority over all economic activates by the bureaucrats. The Eden Building became "Makkah" of all business persons. They had to visit Eden building for small approval and reference and favoritism of all trades.

There is a history of Eden Building. During the British rule, after many shift of places finally Eden School got a place at Topkhana Road and constructed school building but after independence of Pakistan, the provincial government had not building to accommodate secretariat shifted from Writer's Building at Calcutta, North & South block, Delhi. Government took over the newly built school buildings with a promise to return the building after construction of own building but that never happened.

They had constructed some more building and gradually name as Secretariat. The writer Building in Koltatta still exist and Indian love to call it in it's name. I can remember that, while I was a child, my father was a staff Government Printing Press at Tejgaon but frequently visited Eden Building to meet his bosses. The colleagues my father hardly alive but the nation gradually forgot the name of building. A few days back I saw an official paper public work department mentioning Eden building.

Why we don't like to preserve our history or why try erase history is a mystery of the character of

the nation. But the characteristics of persons working in Eden building still same as bureaucrats of British period. The name of country changes thrice but without change of mentality.

The first government of independent country framed the 1st five year plan, Annual Development Programs were prepared according and implemented. Periodic reviews and changes of the fiscal and monetary policies as well as of the export and import policies were undertaken with the socialistic theory of Bangabandhu government. This reflects the efficiency of the than government to reform the economic and political policies in such a short period of three and half years.

Basic principles of labor policy, industrial workers' wages policy and policies regarding pay scales embracing all categories of government and public sector employees including those of the nationalized enterprises were laid down by the government in respond to the ideologies of the state. After the assassination of Bangabandhu in mid-Seventies and specially fall of Soviet Union, block the policy has started changed under the pressure of west and donor agencies.

The military government of Gen Zia has declared the features of mixed economy having public and private sector to complementing each other and an interim 2 years ADP has been adapted.

They had initiate the sell out to people of their choice and handover the state owned enterprises to previous management in contract to the state ideology without much change in constitution.

The two military governments have gradually opened up the economy for private sector like bank, insurance, telephone sectors and side by side sold many enterprises to the private entrepreneurs. They also made the business less controlled by government and also reduced the regulations and also opened up the foreign investments.

The donors are always insisting on consultation on all policy issues with the public sector. The energy, natural resources, communication and import of fuel and energies are strictly under government control except limited power generation in the private sector. The 7th Five your plan and Sustainable Development Goal (SDG) sponsored by UN has emphasis enormous responsibilities to private sector.

All the policy papers are silently in favor of reforms to encourage private sector but most of the members at political office and administration are against the opening up of the economy to the private sector. They don't own the policy and un-willingly implanting those policies. Maybe this dilemma ought to continue to end of the total transformation of economy.

The un-employed citizens also roamed around Motijheel area for private employment and still look at Eden building. The current B2B business also significant without much control of Eden Building. This change of policy has given the commercial business hub of Motijheel a new power centre. By this time, the entrepreneurs also have gained considerable foothold in the political offices.

The road from Eden Building at Topkhana Road has office of left wing Political Parties like Communist Party of Bangladesh and Workers Party of Bangladesh. The Paltan Moidan is very close where all the national leaders promises socialistic state and still may echoing thousands of

slogans against capitalist and capitalism.

The national Mosque is next to these offices of political parties. There are some offices of newspaper and news agencies having a negative perception of private sector. The traditional attitude of bureaucrats is resisting the shifting of power and the road is not smooth. The road to Motijheel from Eden Building has many challenges from some stakeholders.

The capabilities of private sector are also questionable. We have long way to Motijheel and the road has many obstacles and barriers such as legal, ideological and psychological. The business also lacking integration to well organized stock market at Motijheel with involving the common investors in economic activities.

The writer is a Legal Economist