In the last one week, Bangladesh has been in the grip of student unrest over the quota system, rendering discussions over its merits and demerits a household phenomenon. Steering away from political discussions, this assessment attempts to evaluate the socio-economic impact of the quota system on our government's vision of a Smart Bangladesh.
 

During the last decade or so, Bangladesh has made commendable macroeconomic progress, including GDP growth and poverty reduction.

However, declining foreign exchange reserves, high inflation, and a weak banking system highlight issues like high business costs, corruption, brain drain, and youth unemployment.

In addition, recent controversies in government recruitment raise concerns about the quota system's efficacy and relevance after more than five decades since the Liberation War. With only 44 percent of government jobs available based on merit, it has triggered hundreds of thousands of students to take to the streets in protest countrywide.

Our government envisions navigating the country to becoming a Smart Bangladesh by 2041. However, a quota system built on mediocrity may hinder this goal by compromising on skills and productivity, promoting corruption and brain drain, ultimately stunting economic agility and investor confidence that is essential for achieving a dynamic, innovative, and inclusive future.

The quota system in Bangladesh reserves 56 percent of government jobs for specific groups, including freedom fighters' descendants, women, ethnic minorities, and people with disabilities, promoting inclusivity. However, it has significant economic and governance implications.

Filling 56 percent of positions based on quotas rather than merit can lead to a lack of accountability and transparency, fostering complacency and corruption. This undermines efforts to create an agile and responsive economic environment, as individuals may feel less under pressure to perform optimally, knowing their placement was not based entirely on their capabilities.

The inefficiencies created by the quota system raise business costs. Inept government employees make administrative processes slow-moving, causing delays and higher operational costs. This discourages entrepreneurs and tarnishes Bangladesh's investment appeal. A quota system prioritising mediocrity over meritocracy dampens investor confidence, causing investments to favour countries like Vietnam and Indonesia over Bangladesh.

The existing quota system causes youth frustration and contributes to the brain drain and high youth unemployment rates. Talented individuals, frustrated by the lack of opportunities in the public sector, often seek employment abroad, where merit-based recruitment is more prevalent.

The youth, who represent a substantial portion of the population, face demotivation and disenfranchisement when they perceive the system to be biased. This results in a significant loss of potential human capital that could otherwise drive innovation and economic growth in the country.

Transitioning towards a more merit-focused system could yield several economic benefits. A merit-based system would promote greater accountability and responsibility among government employees, leading to greater diligence and dutifulness and reduced corrupt practices.

With more competent and motivated individuals in government positions, the overall efficiency of public administration would improve.
Streamlined government processes and reduced red tape, driven by a capable workforce, can lower business costs and attract more investments. A merit-based system offers the youth fairer job opportunities, discouraging them from looking for better opportunities abroad.

While the quota system was designed to promote inclusivity, its current implementation poses significant challenges to economic efficiency and good governance. By transitioning to a more merit-focused approach, Bangladesh can address issues such as corruption, high investment costs, and lack of investor confidence and pave the way for a more robust and dynamic economic future.

The present demand of the students is deeply rooted in the socio-economic and political fabric of our country, and a middle ground may be the solution. It is important to ensure that our policies reflect our diversity, and that the quota system does not become a barrier to meritocracy but a bridge to equality.

The author is founder and managing director of BuildCon Consultancies Ltd.