Digitise land records - Unlock economic opportunities

Land records in Bangladesh are a bit of a mess—according to the records there is more land owned than actual land exists (according to Anir Chowdhury, Adviser, Prime Minister's Office). The land administration process still follows the antiquated system that British Colonial rulers instituted, from surveys all the way to collection of property taxes. Three different ministries oversee the records system, working independently and with little coordination.

If you need to access your own land record, or transfer property after a sale or an inheritance, you will have to visit multiple government agencies over the course of at least a month - and you should also be ready to pay, possibly under the table.

Records are still kept on paper documents, and in addition to being recorded in painstakingly detailed handwritten transactions, they also use archaic language that ordinary citizens cannot comprehend. Surveys are supposed to be done every five years, but most are extremely out-of-date, so even if you find your record, the survey map may not reflect the reality on the ground. And in coming years, land administration is likely to get even more complicated, given that Bangladesh is already one of the most densely populated countries in the world.

How can Bangladesh best address the problems that stem from its outdated land records system? 

New research by Sultan Hafeez Rahman, Executive Director of the BRAC Institute of Governance and Development (BIGD), and research assistant Sumaiya Kabir Talukder finds that digitising the land records system would provide an incredible Tk. 619 of benefits per taka spent.

The labourious and time-intensive records system creates room for errors due to honest mistakes or the potential for outright corruption. If you need to transfer the title of a parcel or address any other land-related issue, officials might demand compensation before they move the process along. One study found that land administration accounts for nearly 40 percent of all bribes paid at the local level in Bangladesh ("Cost of Corruption and Misgovernance at the Local Levels: Findings of a Survey", Kaneez Siddique, Programme for Research on Poverty Alleviation No. 57, Grameen Trust).

The complexity of the system and tendency for officials to delay or block the process encourages people to rely on informal title arrangements. But this informality weakens the security of property rights and undermines economic activity.

The analysis proposes digitising land records and simplifying the application process, a strategy the national government began to explore in 2010. Savar upazila has piloted a programme to digitise its land office, and the transition from a paper-to software-based system has already cut costs and made land services much simpler for citizens to use.

Electronic land records nationwide would make information easy to acquire through a publicly accessible system, and the time, monetary, and other transactions costs required to access records or transfer parcels would fall tremendously. Digitisation would also make it impossible for anyone to physically manipulate records, decreasing opportunities for officials to extract bribes, and leading to fewer land disputes and court cases.

Digitisation costs across Bangladesh's 483 remaining upazilas would include Tk. 77.28 million to purchase computers and software and Tk. 650 million to scan the 50 million existing land records. It would also cost Tk. 90.42 million to staff the offices each year. In total, this implies a cost of Tk. 2.8 billion. 

The benefits would accrue due to more speedy expedition. Today, a typical transaction involving land records costs Tk. 1,045, takes 30-45 days, and requires five different trips to government offices. With digitisation of the system, however, the cost would fall to just Tk. 80, and it would take only 15 days and two visits ("Service delivery process innovation: insights from Digital Bangladesh, Innovation and Development", Hasanuzzaman Zaman). Including benefits of fewer legal transactions and fewer bribes, the total direct benefits reach Tk. 481.8 million annually. So just counting the direct benefits, each taka spent to digitise the land records system would do more than Tk. 3 of good.

However, the largest benefit from digitisation will come from increasing the security of property rights across the country. It is well-known in economics that there is a link between more secure property rights and higher economic growth. Assuming that land digitisation will move Bangladesh a small way towards a society with more secure property rights, and based on large-scale estimates of property right impacts on GDP growth across a wide range of nations, the experts predict that land digitisation would bring benefits of more than Tk. 160 billion over the next 15 years, and possibly more than Tk. 1.3 trillion by 2070. This indicates indirect benefits of Tk. 616 for every taka spent. 

So, in total, Tk. 619 in direct and indirect benefits result from each taka spent to digitise land records. 

Of course, the Tk. 619 is crucially dependent on the estimated growth increase. Yet, even with vastly different estimates, the benefits of land digitisation are phenomenally higher than the costs. If you were in charge, would this be one of the solutions you think should be at the top of Bangladesh' list of priorities? Let us hear from you at https://copenhagen.fbapp.io/landadminpriorities. We want to continue the conversation about how to do the most good for every taka spent.

The writer is president of the Copenhagen Consensus Center, ranking the smartest solutions to the world's biggest problems by cost-benefit. He was named one of the world's 100 most influential people by Time magazine.