By any measure you may care to mention, Bangladesh witnessed massive political upheaval in 2024. It means the country today, in these dying embers of the year, actually looks completely different from the country that was, at the start of 2024. That was a nation forged in the image of the Awami League, carefully crafted over the last 15 years by Sheikh Hasina, who took oath as prime minister for the second time in 2009. Little did anyone know at that point, how she would go on to violate every single pledge contained within it.

The events of July-August in particular, will remain forever etched in the collective memory of this nation. As the movement that started under the banner of Quota Reform transformed and evolved into one of outrage at how student protesters had been gunned down, maimed for life, or otherwise incapacitated. It was really only after the internet was partially turned back on, i.e. July 23rd, that the stories of the security forces' brutal crackdown on the protesters started spreading through the population. Once mobile internet was restored, another five days later, this only served to provide further impetus to the impression that the government, for some mad, unconscionable reason, had turned against the citizenry, and it had done so with a vengeance. From there onwards, it was the government against the people, and there could only ever be one winner in that.

Thus the movement, if traced accurately, can never be described through just one demand. As soon as blood was shed, that happened on July 16, the day Abu Sayeed was callously gunned down by police in Rangpur near Begum Rokeya University, with a video capturing the incident going viral within hours, the movement could no longer be confined within the parameters of reforming the quota system. That much was clear. Even a decision to bring forward the date of the hearing in court over the quota system, and then passing a verdict that fulfilled the demands of the students to a T - a shameless attempt at appeasement - became of little relevance by then.

These days, over four months on from the ultimate success of the movement - getting Sheikh Hasina to flee the country on which she held an iron grip for so long, an often-heard refrain is that so much blood wasn't shed, or so many lives weren't lost, only to have an election. As to why they were, no clear answer can be offered, since none of the dead, the movement's martyrs, obviously left behind any clearly defined statement in this regard. That some form of reform initiative would be desirable, to get the state back on track after 15 years of an oppressive, autocratic, and what thinker Farhad Mazhar insists was a Fascist dispensation, is eminently sensible.

Nobody is opposed to the idea of reforming the state and its institutions, to reflect the democratic aspirations of its citizens. Yet how these reforms would be initiated or implemented, or even what they would entail, was never part of the discourse during those heady days of the movement. You can peruse the images of those unforgettable gatherings at Shaheed Minar, or wherever the coordinators were speaking on a given day. What you'll see is that initially, the slogans on the placards are all about quotas, denouncing quotas, extolling the virtues of merit, etc.

The most notable new entrant alongside these themes, and this starts happening July 18 onwards, is 'Justice for Abu Sayeed' or 'Justice for My Brother's Murder'. And then, a few more days later, say the last week of July, we start seeing placards that say "Justice for the Genocide" or "Justice for the Mass Killings". This coincided with a period during which the students had placed a 9- and then an 8-point demand that sought to address the changing dimensions of the movement. Through them, even the student coordinators were looking to make the then-government realise that this was no longer about quota reform. It couldn't be, after the sheer loss of life we had in our hands by then. Till today, AL apologists point to the students' apparent transgression at not accepting the High Court decision on quotas delivered on July 21 as some sort of proof that the entire thing was a part of some grand conspiracy. Whereas just two days earlier, on the Friday (July 19), 66 people had been killed.

It was becoming more and more apparent that the government had lost the pulse of the nation. It kept harping on about BNP and Jamaat instigating the students, but the truth is that till July 15, a pivotal day when Chhatra League goons wreaked havoc on the campus of Dhaka University, not even sparing the women. This was a highly distressing day for the movement's leaders, or 'coordinators', as they preferred to be called, and that evening, one of them, Nahid Islam, made an open appeal to other political fronts with their presence on campus to join them in their movement, as they had no intention of backing down in the face of Chhatra League's intimidation. But at the same time, they had no wish to endanger the participants, especially girl students who were coming out in big numbers since their heroic turn on the night of July 14, within hours of the prime minister's 'Razakar' jab at the quota reformists. Both BNP and Jamaat responded positively, and from the 16th onwards, became active participants.

The end of the road

Meanwhile the government failed to inspire confidence in its sensitivity and commitment to resolving the situation in a manner that could return the country to peace anytime soon. It completely ignored the 9-point demands of the students. The security agencies' block raids and mass arrests continued to distress the people, especially in areas with large student populations. It had decided on a narrative as to what happened and why, and was working to establish it, rather than starting from a clean slate and working to establish the truth.

The latest iteration of this narrative was delivered on Thursday, August 1 by the foreign secretary, who was joined by the prime minister's newly appointed press secretary, Nayeemul Islam Khan, in a briefing to foreign envoys based in Dhaka. Despite repeated assurances of appropriate measures by Prime Minister Sheikh Hasina through a televised address on July 17, the BNP-Jamaat combine instigated unrest and violence among a section of the student community by provoking inflammatory rhetoric and slogans, including by distorting the Prime Minister's words at a press conference (July 14), MoFA said.

The situation soon spiralled out of control of the protesting students, and led to unprecedented levels of violence, anarchy and brutalities that can only be termed as terrorist activities. These resulted in the most tragic and egregious loss of a number of civilian lives, including 'some' young people and minors, MoFA told the gathering of diplomats. After all this, on August 2nd, the home minister stated to the press that "No one had died in police firing" in the violence ensuing from July 16. It was probably the last straw, and what finally convinced the students to unveil, on Saturday, August 3, their final card: the "Ek Dofa' or single point-demand: Step Down Hasina.

Even then, no one could have foreseen that this audacious demand would be fulfilled within 48 hours. Although not before presenting the country with the bloodiest day of the entire movement till Hasina boarded the plane to India, on Sunday, August 4. Our sister newsagency UNB reported 104 people killed on that day, the vast majority by security agencies of the state, although this was also the day when we could report the first instances of attacks on the police, with 14 of them killed in unprecedented attacks on police stations in Sirajganj and Cumilla - 13 of them in the former.

This sort of direct conflict between citizens and an agency of the state meant to protect them, was never expected of course. And in itself, almost obligates a reform initiative. And so in that sense, the push for reform isn't something conjured out of thin air. It is the extent of it, and how it can be institutionalised in the state's structure, that may prove tricky for the interim government in 2025. Possibly its biggest strength in this regard, would be to use the goodwill and near-universal respect enjoyed by Dr Yunus as the head of government.

How the economy fared

Bangladesh's economy in 2024 faced major challenges, as rampant inflation not only eroded purchasing power but also overshadowed the country's progress in other areas, underscoring the growing struggle to balance development amid rising economic pressures.

The rising cost of living, driven by domestic and international factors, strained households and tested the government's economic strategies, yet the country maintained moderate growth due to its resilient economic framework.

The inflation rate in Bangladesh reached an alarming average of 11.38% in November 2024, marking the highest level in over a decade. Inflation hit 11.66 percent in July, the highest at least since the 2010-11 fiscal year, driven mainly by food prices reflecting the worsening of the purchasing capacity of people.

This sharp increase was fuelled primarily by escalating food prices, which constitute a significant portion of household expenditure and the Consumer Price Index (CPI). For comparison, the inflation rate stood at 8.56% in 2023, reflecting the worsening situation in 2024.

Food inflation, in particular, hovered around 12%-14% for most of the year, as prices of essentials like rice, cooking oil, and vegetables surged. Non-food inflation also rose steadily, driven by increased transportation costs, higher utility bills, and imported goods becoming more expensive due to currency depreciation.

Leading factors contributing to inflation

Global Commodity Prices: Fluctuations in global commodity markets, particularly for energy and food products, had a direct impact on domestic prices. The war in Ukraine continued to disrupt global supply chains, leading to higher import costs for essential items like fuel, wheat, and edible oils.

Currency Depreciation: The Bangladeshi Taka depreciated significantly against the US dollar, exacerbating inflationary pressures. The currency weakened by approximately 10% in 2024, making imports more expensive and driving up prices in the domestic market.

Supply Chain Disruptions: Persistent disruptions in global and regional supply chains further aggravated the inflation problem. Delays in shipping and logistical bottlenecks caused shortages of key commodities, leading to price hikes.

Domestic Demand Pressures: Rising domestic demand, particularly during festival seasons, added to inflationary pressures. While increased consumer spending is typically a sign of economic vitality, it also contributed to supply-demand imbalances.

The inflation crisis severely impacted households across Bangladesh, particularly low- and middle-income families.

The increased cost of essential goods such as rice, pulses, and cooking oil eroded purchasing power, forcing many families to cut back on non-essential expenditures. Reports indicated that some households were skipping meals or substituting more expensive foods with cheaper alternatives.

Urban areas, where reliance on market purchases is higher, faced acute challenges. Meanwhile, rural households, though somewhat shielded by local agricultural production, also struggled with rising input costs for farming.

Real wages for workers in both formal and informal sectors failed to keep pace with inflation, further widening income inequality. The situation underscored the urgent need for targeted social safety nets and measures to protect vulnerable populations.

The queues behind OMS trucks across the country is getting longer and longer as the middle-class and lower-middle class people are feeling the pinch of the inflation at the worst level.

Policy prescriptions

Monetary Policy Tightening: The central bank raised the repo rate five times in 2024, reaching 10% in October. This marked a significant tightening of monetary policy aimed at curbing inflation by reducing liquidity in the market. However, higher interest rates also made borrowing more expensive, potentially dampening business investment.

Subsidy Adjustments: The government increased subsidies on food and energy to cushion the impact of rising prices. Special programs were introduced to provide subsidized rice and wheat to low-income families.

Exchange Rate Reforms: In May 2024, Bangladesh Bank adopted a crawling peg exchange rate system to reduce the gap between formal and informal exchange rates. This reform aimed to stabilize the Taka and improve foreign exchange reserves, which stood at around $25 billion by year-end.

Market Monitoring: To control price manipulation, the government intensified market monitoring efforts. Task forces were deployed to prevent hoarding and ensure fair pricing of essential goods.

Social Protection Programs: The government expanded cash transfer programs and food aid schemes to support the most affected households. Initiatives like the Vulnerable Group Feeding (VGF) program were scaled up to reach millions of beneficiaries.

Despite high inflation, Bangladesh's GDP growth remained positive, albeit slower than in previous years. The Asian Development Bank (ADB) projected a growth rate of 5.8% for 2024, while the International Monetary Fund (IMF) estimated 5.4%. This growth was driven by robust performance in the manufacturing and export sectors, particularly the ready-made garment (RMG) industry, which accounted for over 80% of export earnings.

However, domestic consumption and investment faced challenges due to inflationary pressures and higher borrowing costs. Small and medium enterprises (SMEs), a backbone of the economy, struggled with rising input costs and reduced consumer demand.

To address economic challenges, Bangladesh sought international assistance. In September 2024, the World Bank pledged over $2 billion in financing for various initiatives, including flood response measures, healthcare improvements, and air quality management.

Besides, the IMF disbursed $680 million as part of its Extended Credit Facility (ECF) program, supporting fiscal reforms and boosting foreign exchange reserves.

These funds provided much-needed relief and underscored Bangladesh's strong ties with global development partners.

The well connected interim government is getting various types of budgetary support in different names which are giving little bit relief for the government, which took charge on August 8 after the fall of Awami League regime through a mass movement of students and people.

Bangladesh faces a delicate balancing act for the coming days. The government aims to reduce inflation to below 7% by mid-2025, a target that will require sustained efforts in monetary and fiscal management.

Priority areas

Strengthening Agriculture: Boosting domestic food production through incentives and technological advancements could help reduce reliance on costly imports.

Enhancing Social Safety Nets: Expanding targeted programs for low-income households will be critical to mitigating the impact of inflation on the most vulnerable.

Structural Reforms: Improving governance, streamlining tax collection, and addressing inefficiencies in public spending are essential for long-term economic stability.

Diversifying Exports: Reducing dependence on the RMG sector by promoting industries like pharmaceuticals, IT, and agro-processing can provide new growth avenues.

The year 2024 was marked by significant inflationary challenges for Bangladesh, testing the resilience of its economy and the effectiveness of its policy responses. While inflation strained households and businesses, the country's moderate growth and robust export performance offered hope for recovery.