The country's economy is experiencing an asymmetrical structural transformation with a falling share of the real economic sectors and increasing contribution of the service sector, said economists.
"In any transitional economy, the share of agricultural sector reduces relatively while the manufacturing sector's contribution increases. But the funny thing is that services sector's contribution is higher than that of the manufacturing sector here," Zaid Bakht, Research Director of the Bangladesh Institute of Development Studies (BIDS), told the agency.
He said the contribution of the service sector in terms of value addition is relatively smaller compared to the manufacturing sector.
"We should concentrate on manufacturing sector instead of shopping mall-centered growth," he said adding, diversification of the industrial base, and access to technology and credit to the industrialists are needed to boost the manufacturing sector.
"But the growth of service sector is not necessarily bad," he noted.
"The space left behind by the agricultural sector was not adequately picked up by the manufacturing sector in Bangladesh, which is needed for our economy now," said Centre for Policy Dialogue (CPD) Research Fellow Khondokar Golam Moazzem.
"Instead, the share of construction and gas, water and electricity increased from 5.2 percent in FY 80 to 10.3 percent in FY05. As a result, the contribution of real economic sectors kept falling over the period," he commented.
He said the share of the real economic sectors, including agriculture, manufacturing, mining and quarrying, was 38.1 percent in 2004-05, whereas a decade before the matching figure was 40.5 percent.
The employment generating by the service sector is not for unskilled labour. But manufacturing sector can create employment for unskilled labourer needed for reducing poverty, he said.
Moazzem said the government should provide specific policy support to the potential industrial sector to enhance both import substitute and export oriented industries so that the goal of poverty reduction could be attained.
"The growth, which the economy is experiencing is not driven by the productive capacity growth," said Rashed Al Mahmud Titumir of the Department of Development Studies, University of Dhaka.
He said the growth would be viable once if employment is generated through industrialisation.
According to CPD, the annual growth of the real economic sector in FY05 was only 3.8 per cent, while the service sector experienced a higher growth of 6 percent.
Besides, the contribution of the real economic sectors to incremental growth declined from 33.6 percent in FY04 to 27.3 percent in FY05 while the incremental contribution of service sector in real GDP growth increased from 44.6 percent to 60.9 percent during the same period, CPD observed.
