A few weeks ago one member of cabinet of the present government announced that Bangladesh is aiming to build a welfare state. This is the first time that anyone in the inner sanctum of power in Bangladesh where policies are made gave vent to the ambitious plan for an inclusive and just society. This is an aspirational goal at the moment but cannot be said to be totally unrealistic. A new government is expected to be visionary and want to leave the beaten track. The announcement about a structural change in economic governance is a welcome gambit.
As is well known, a welfare state guarantees basic needs of food, education, utilities, healthcare, transport and housing at reasonable costs to users. Unlike Marxist communist countries of yore, these items and services had been provided in democratically elected governments in either of two ways. The first model emerged in the United Kingdom (UK) after the end of second world war under which the utilities, healthcare institutions and railway were nationalised. These were run by the government and their services were provided to citizens at subsidised rates, the beneficiaries being required to contribute to national security insurance in amounts calculated on the basis of their income. Education, though not fully nationalised, particularly at higher level, was also provided at subsidised cost. The main feature of this model of welfare state was that it was inclusive, leaving out no class irrespective of their income or status of employment. The second model of welfare state appeared later in the Scandinavian countries where the subsidised services were financed out of the proceeds of a very steep progressive income tax borne by the rich, amounting to 80 per cent of their annual income. Here too, the middle and lower income earners paid to the national exchequer, based on their income. The coverage of beneficiaries was comprehensive, irrespective of their income or profession. No class of people were excluded, even when they were unemployed or disabled.
The above overview of the concept and practice of welfare state is given with reference to the recent announcement of the cabinet member (advisor) regarding introduction of welfare state in Bangladesh and the current wholesale eviction of hawkers in Dhaka, including destruction of their meagre capital and where withal. It is contended in this column that the announcement of establishing a welfare state and the sudden eviction of hawkers are contradictory. The hawkers are citizens of Bangladesh and are engaged in honest business selling legal goods and providing fair services. Their faults, brought out by many research, are the following : (1) they occupy spaces illegally; (2) their presence creates congestion, particularly in footpaths and roadsides, making pedestrian walks difficult; ( 3) they create unhygienic condition leaving garbage in the vicinity of their stalls or shops; (4) they sale unhygienic foodstuff ; ( 5) they do not pay taxes.; (6) many of them use utilities like water, gas and electricity illegally. All of these allegations are more or less well founded and mostly accurate. In spite of these hawkers in Dhaka should be allowed to carry on their trades under a regulated system because of the following considerations : (1) in a situation of glaring unemployment in the country the hawkers create self- employment and also provide employment to others; (2) though their contribution to gross domestic product (GDP) is not officially estimated because of the informal market where they operate it is not negligible as will be seen later; ( 3) they meet the needs of daily necessities of low income earners charging lower prices; (4) they are easily accessible to buyers being near to their residence or workplace, (5) many of them provide outlet for wholesalers and factory producers and as such are part of the supply chain of many goods produced in the country by small and medium scale industries( SME).
ECONOMICS OF HAWKERS: Some studies have been made on the number of hawkers in Dhaka, the goods they sell and services provide and the number and type of consumers who buy from them. According to these studies, the lower estimate puts the number of hawkers at 300,000 while according to the upper estimate the number is 500,000. Taking the lower estimate of three lakhs and imagining three members per family, a hawker provides food and shelter to nine lakhs people in Dhaka, around four per cent of the population of Dhaka Metropolitan area (24 million).
Not only three lakhs hawkers are self-employed, many of them engage one to or two helpers and assistants from urban unemployed or rural migrants. So the total employment in the informal market of hawkers will be around over six lakhs. Many of the hawkers are born in Dhaka but there is a steady stream of unemployed from villages that constitute rural-urban migration. The migrants do not come to Dhaka for ' city lights' or to enjoy fun, they are pushed out of their villages by unemployment and underemployment caused by population pressure stemming from high birth rate, river erosion and foreclosure of land including homestead because of indebtedness. Those who glibly recommend sending hawkers to villages to take up work in agriculture do not take these realities into consideration or are ignorant of ground reality. True, some semi-literate and semi-skilled villagers migrate to Dhaka and other cities in search of better life but their number is negligible. The same can be said about migrant workers who go abroad selling land and paying through their noses to manpower agents. The vast majority of rural migrants come to metropolitan cities like Dhaka because of 'push' and not 'pull' factors. This is elementary sociology and economics 101.
The hawkers in Dhaka and in other places in Bangladesh, far from being parasites and hangers on, contribute to the economy of Dhaka and to the Bangladesh economy as a whole even though their contribution is not accounted for by Bangladesh Bureau of Statistics (BBS) the sector being informal. But their contribution to GDP of metropolitan Dhaka and of Bangladesh has been estimated by researchers from time to time. Older studies of Dhaka hawkers found an average hawker earning Tk 3500 per month but street food vendors earned more, Tk 5000. A research study in 2026 found that while a small scale hawker earned between Tk 15,000 - Tk 20,000, a busy food vendor with fixed location earned Tk 40,000-Tk 50,000. But this is gross income, the net income after deducting costs of buying and transportation etc is Tk 40,000 per month in Dhaka for hawkers with fixed location and stalls. Taking the figure of three lakh hawkers of different sizes and types in Dhaka the annual average sales have been estimated at Tk 300 billion. But hawkers engaged in retail market do not contribute their full sales value to GDP. A reasonable value added ratio of gross sales and GDP contribution will be 25- 35 per cent of the annual estimated sales which in monetary value terms come to Tk 120 billion in annual income. Out of Dhaka's GDP contribution the hawkers sector contributes about one per cent in value added terms. This percentage is growing every year.
The economic contribution by hawkers cannot be estimated by sales alone or their contribution to GDP. Hawkers constitute a supply chain helping manufacturers, farmers and wholesalers to distribute and sale their products with minimum cost compared to the supply chain in the formal sector. Another economic benefit of the hawker sector is making their products available to consumers at cheaper price and convenient places.
Among the popular items sold by hawkers are street foods, clothing including shirts, T-shirts, trousers, jeans garments, socks and undergarments, household utensils, accessories of mobile and other electronic instruments. Services like filling up forms and deeds of agreement are also provided by educated hawkers. Among the clientele of hawkers are students, workers of factories, housewives from middle class households, shop assistants, garment workers and holidaymakers. Most of them are from lower income group and as such having goods at low prices help them reduce cost of living. Those who inveigh against hawkers forget about their vast clientele and the service rendered to them to ease daily living. In Metropolitan Dhaka the number of people from lower income group who buy from hawkers various items is estimated to be around 8 million by a study conducted by BRAC - BIGD. Evicting the three lakh hawkers means these outlets with reasonably priced goods will not be available to meet their daily needs. Particularly hard hit will be lower income employees of offices and workers who have cheaply priced lunch at the makeshift stalls of hawkers near their work-places.
Eviction of hawkers will not only make them unemployed, their dependents vulnerable to hunger and starvation but also force the eight million clienteles to either forgo buying essential items like cheap food or to incur debt to meet rise in costs of living.
Hawkers are not unique to Bangladesh. They can be found even in developed countries because every country needs hawkers to buy essential items conveniently and at lower prices. In these times of inflation hawkers selling at bargain-basement prices are considered as a relief from the economic stress felt by many households. Bangladesh was no exception to this.
Taking the supply side (self-employment and employment) and demand side (purchase of cheap goods) of hawkers sector into consideration they can by no means be seen as an unmitigated problem. The problems associated with hawkers and venders enumerated earlier in this column are because of lack of regulation and good management by concerned authorities. They could address the problems one by one and in a phased manner if they were serious. But instead they kept quiet and allowed an otherwise innocuous matter to eventually become a humongous problem. Designating areas and exact spaces for hawkers and vendors, fixing alternate days for sales by particular hawkers, keeping a part of the footpath free for pedestrians, broadening footpaths and creating new zones for hawkers, enforcing hygienic measures and system of keeping garbage are some of the measures that could place the hawker sector safe and sound both for them and for the public. We do not have to go far to see how hawkers and vendors ply their business lawfully and conveniently for the public. Many Bangladeshis have seen hawkers on Bangkok streets selling food and other items. Far from being eye sores they have added grace to the urban landscape and convenience to commuters. With very little effort and pragmatism we could bring the hawker sector under control in a similar manner to the benefit of both the three lakh hawkers and their eight million clienteles. Instead we have decided to destroy the makeshift stalls and shops and evict the hapless hawkers without giving them sufficient time to move out and making alternative arrangements for their rehabilitation. The ferocity and cruelty with which the eviction campaign has been carried out gives the impression as if the hawkers are hardened criminals who have suddenly swooped on the city. As seen in reels they were not even given any time to take away their meagre belongings. It was as if they had suddenly appeared and occupied spaces illegally concealing their presence from the authorities. Those very agencies responsible for regulating occupation of urban spaces looked the other way so long because hawkers were cash cows to them and a number of rent seekers. How can it be said they are a free launcher lot? A public hue and cry has recently been created dramatically over the hawker issue. The government was expected to take action but not through knee-jerk reaction. A time bound phased plan could be taken up to address the problem. But the highhanded manner with which the government has moved against the hawkers gives the impression of impetuosity and sudden impatience. The way the hawkers have been evicted does not square at all with its desire to build a welfare state. If there is really going to be laying down the foundation of a welfare state the crackdown hardly augurs well for that. Ignoring the right to livelihood of three lakh hawkers in Dhaka and many more in other urban areas of the country strikes at the very heart of welfare state.
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