Report

146 QUANTIFICATION OF BENEFITS FROM ECONOMIC COOPERATION IN SOUTH ASIA
the global growth of information technology. The
government has already formulated an ICT policy,
which addresses the need for increased private
participation to drive growth in this sector. So far,
a good number of foreign training centres have
opened branches in various cities; some of them
initiated jointly with Bangladeshi entrepreneurs.
However, the wide gap between the supply and
demand for services, as well as the limited number
of quality training centres, reflect the breadth of
opportunity for development in this area. Besides
computer-related skills training, there is also
increased demand for training in graphic design,
interior decoration, machine operation, packaging
development, global trade issues, etc.
At the tertiary level, UGC is responsible for
regulating private and public universities, and thus
serves as the intermediary between the government and
autonomous educational institutes (Raihan and
Mahmood 2004).
According to the study, the constraints facing the
education system in Bangladesh can be categorised
under three broad headings, i.e. (1) access and equity;
(2) quality of education, and (3) governance and
management of education. Similar to other South Asian
and LDCs, the growth potential in the education sector
in Bangladesh is severely hampered by institutional and
regulatory constraints and inadequate resources.
The education services are among those social
services sectors that have been identified on account of
their import interests (Raihan and Mahmood 2004).
The GDP share for education services in Bangladesh is
only 2.36%. They argue that liberalisation of this sector
is likely to attract foreign investment which will facilitate
its further growth and will play an import substitution
role in the long run (Ibid.). The opening of offshore
campuses of foreign universities and the growth
of private universities with foreign affiliation creates
some sort of import substitution effect. Also, given the
low revenue/GDP ratio, the government is largely
dependent on external sources for financing its development
budget. External aid finances more than 50%
of government development expenditure on education.
The above analysis of the education sector would
strongly suggest that there are good reasons for
Bangladesh to undertake commitments in this sector
during the current round of services negotiations. In
fact, Bangladesh ought to undertake commitments in
higher education (CPC 923), adult education (CPC
924), and other education (CPC 929) and in all modes.
It is interesting regarding Bangladeshi education that
it has already developed a very close relationship with
India, Nepal and Bhutan in the region. The WTO
commitments will further boost this relationship and
Bangladesh may also develop some niche market in the
region for export of education. India is clearly in an
advantageous position and can supply education to
Bangladesh through all modes. The available literature
suggests that recognition of foreign qualifications
perhaps does not seem to be an explicit problem in
Bangladesh. This should be an additional reason why
service providers from the region should invest in the
sector in Bangladesh.
The Maldives
Like Bangladesh, the Maldives too has not yet undertaken
any commitments in the education sector nor
has it proposed any commitments during the ongoing
round of negotiations. However, shortage of skilled
labour, skills mismatch in the labour force and the high
proportion of foreign labour have been highlighted as
major obstacles to the economic growth of the
Maldives. Although educational attainment in the
Maldives has improved over the past several years,
other elements for a strong human capital base are
missing (World Bank 2006). In 2004, the graduate
output was 862, representing certificate, diploma,
degree, and foundation study programmes. Despite
certain improvements, the lack of local skilled labour
continues to be a major problem in the Maldives. Moreover,
the quality of education has not kept pace with
enrollment. This has led to a dysfunctional labour
market that creates high reliance on migrant labour
from neighbouring countries. Since there is no statutory
minimum wage, cheap labour in the region, especially
from India, Sri Lanka, and Bangladesh, further
depresses the market. The domestic labour force stood
at about 87,442. The labour force participation rate is
47.7%. The local labour force is supplemented by the
employment of a significant expatriate labour force.
In 2004, 38,413 expatriates were employed in the
Maldives, up from 33,765 at the end of 2003. The
World Bank suggests that there is no easy and immediate
solution to this emerging problem, given the
Maldives’ proximity to a large, cheap labour market
in India, Sri Lanka, and Bangladesh. Categories in
which expatriate labour has been employed mostly
include teachers, medical personnel and other professional
categories, as well as semi-skilled and unskilled
workers such as domestic helpers and construction