The COVID-19 pandemic crisis has led to a cruel dilemma: the economy must be shut down to ensure effective physical distancing, otherwise, too many lives will be lost, and yet shutting down the economy has its own dire consequences. This report seeks to present an integrated policy framework to deal with this dilemma in Bangladesh, that consists of a judicious combination of three types of policy instrument: (a) physical distancing through the economic shutdown, as a means of containing the spread of infection, (b) bold measures of economic support, especially entitlement support to households, who are facing the spectre of hunger as a consequence of economic shutdown, and (c) a powerful system of public health support, as a means of ensuring that the economy can be reopened ‘safely’. The paper estimates that at least half of the population has become food insecure in the wake of the economic shutdown. This means that some 20 million households will need entitlement support in the first phase. The amount of support needed is estimated conservatively at Tk. 8000 per household per month. In the second phase, when the economy begins to re-open, the number of households needing support will gradually decline. Taking the two phases together, it is estimated that the entitlement support program will cost Tk. 960,000 million – about 3.8 per cent of GDP.
Author: Osmani, S R
Type: Report
Year: 2020
