5 (five) year plan in Bangladesh

Five-year plans are financed through the development, or capital budget, which was separate from the government's revenue, or administrative, budget. After the independence of Bangladesh, it was widely believed that once reconstruction tasks were over, the domestic economy would provide most of the resources needed for development. This view was mistaken because systematic drainage of Bangladesh’s resources during the British and Pakistani colonial regimes, which had left it with a deficit in food grain availability. Low levels of internal savings and a high population living below poverty line were evident: what in other words could be called a state of chronic external dependence.

The country has followed the course of planned development since 1973. In a medium term framework, the First Five Year Plan was launched in July 1973. This was followed by a Two Year Plan (1978-80) in the background of world-wide inflation and uncertainties. In 1980, the five year plan framework was reinstated and since then three five year plans were implemented in succession. There was no development plan during 1995-97 after the expiry of the Fourth Plan (1990-95). Every plan targeted at an average annual GDP growth rate of above 5 per cent but achieved about 4 per cent. In spite of large inflow of foreign assistance to augment meager domestic resources, the planned effort for development has not been able to free the economy from the low growth trap. Almost half of the population of Bangladesh still continues to eke out an existence below poverty line with very little access to the basic amenities of life.

Every Plan targeted for an average annual growth rate of above 5 percent. Despite a large flow of foreign assistance, the planned effort has not been able to get away from the low growth trap as half the population of Bangladesh still continues to live below poverty line.