From Red Tape to Real Opportunity: Democratizing the Economy for All

Overregulation often begins with good intentions. Most rules do. They are meant to bring order, curb abuse and protect the public.

But over time, rules can harden into something else – layers of paperwork, signatures and permissions that quietly make everyday life harder for ordinary people. In Bangladesh, excessive regulation is no longer just a technical policy issue. It has become a lived experience for millions who want to work, start something small or simply move forward without fear of delay or humiliation. Deregulation, in this sense, is not about removing all rules. It is about restoring balance in a system that increasingly works against the people it was meant to serve.

A more honest critique of overregulation must confront an uncomfortable reality: highly controlled systems often fail even on their own terms. Bangladesh has some of the toughest regulations aimed at preventing money laundering and restricting the flow of money abroad, even for legitimate business needs. Yet despite these controls, vast sums have still been siphoned out of the country. The absence of PayPal is often justified in the name of strict financial regulation, but for ordinary freelancers and small businesses this means lost income and missed opportunities. Meanwhile, trillions of taka have continued to leave through illicit channels. Overregulation did not stop wrongdoing. It mainly made life harder for those trying to earn honestly.

The economic signals reflect this deeper problem. Investors routinely cite prolonged licensing procedures, poor coordination among government agencies and sudden regulatory shifts. Bangladesh once ranked 119 out of 183 countries in the World Bank's Doing Business report. By its final edition in 2020, the country had slipped to 168 out of 190 economies. Behind these rankings are real delays – months spent waiting to begin operations, uncertainty that discourages risk-taking and costs that quietly pile up before a business even opens its doors.

Foreign investment tells a similar story. In 2018, Bangladesh received about $3.62 billion in net foreign direct investment, then a record. But the momentum faded quickly. Net FDI fell sharply in subsequent years and declined again in 2024 to around $1.27 billion, marking four consecutive years of decline. At present, FDI accounts for less than 1 percent of total fixed investment. Fewer greenfield projects mean fewer new factories, fewer jobs and fewer opportunities for technology and skills to spread.

The structure of the economy makes these losses harder to absorb. Around 85 percent of export earnings still come from the garment sector. When regulation slows even one clearance or approval, the ripple effects are large. A delayed customs process can mean missed shipping windows. A stalled permission can mean unpaid wages. This creates anxiety for workers, small suppliers and families who depend on regular income.

Beyond the numbers, the human cost becomes clearer when power asymmetry is acknowledged. Inequality in Bangladesh is not only about income. It is also about who has power and who does not. Wealth tends to accumulate where power already exists. For those without it, even simple tasks such as registering a business, renewing a licence or accessing a service can become exhausting ordeals. Long queues, repeated visits and unclear instructions are common. Those with influence often bypass the same processes with ease. Excessive regulation, instead of protecting fairness, ends up deepening this divide by giving more discretion to gatekeepers.

This is why deregulation should be seen as part of a broader democratic effort. When a young person with a workable idea spends weeks moving between offices, hope erodes. When a small entrepreneur gives up because the process feels endless, the economy quietly loses energy. Too many rules do not automatically prevent corruption. In fact, they often create the very spaces in which it thrives. Thoughtful deregulation can reduce these pressures by making rules simpler, timelines clearer and treatment more equal.

Deregulation, however, is not a cure-all. Opportunity must also be accessible. Power asymmetry shapes access to finance as well. Those with assets and connections can raise funds easily, while those who need capital the most are often excluded. This is where the idea of microcredit, popularised by Dr Muhammad Yunus, remains relevant – not as an institution to be idealised, but as a reminder that access to credit matters. Small amounts of capital can allow people to invest in skills, tools and dignity. At the same time, credit models are not without risk, and without safeguards they can reproduce new forms of vulnerability.

Economic reform also requires a moral foundation. Regulation or deregulation alone cannot guarantee fairness. Without an ethical compass, systems slide into a kind of chronic capitalism in which bending rules becomes routine and honesty feels costly. Recent calls for deregulation by senior policymakers and political leaders have reopened an important debate. BNP Standing Committee Member Amir Khasru Mahmud Chowdhury recently argued that the economy must be democratised to ensure equal opportunity for every citizen, noting that the existing model has largely worked for a narrow section of society while failing the wider public. Speed and efficiency, however, must be matched with transparency, accountability and a sense of responsibility towards those with the least power.

Decentralisation is another missing piece. Although roughly 62 percent of economic activity is generated in rural areas, only about 6 percent of the national budget reaches them. This imbalance limits real autonomy. Villages cannot thrive without reliable electricity, internet access, transport and local decision-making power. Strengthening rural purchasing power is not charity; it is essential for sustainable growth.

Across the country, villages are filled with skilled potters, weavers, woodworkers and craft producers. With support in design, training and logistics, many could reach national or even international markets. Digital platforms already exist, but unnecessary barriers keep people small and local. When rural producers can sell beyond their immediate surroundings, income circulates within communities and strengthens families.

Creative industries offer similar promise. Music, film, art, crafts and sports can provide livelihoods for young people who do not fit into narrow career paths. A more diverse economy distributes opportunity more widely and reduces dependence on a few sectors. This requires investment in people and places, not just centralised control.

Bangladesh now stands at a fragile moment. Rising inequality, reflected in a Gini coefficient that economists warn is dangerously high, shows that wealth is concentrating rapidly. If this trend continues, it will strain social cohesion and test national stability. Economic reform is no longer only about growth figures; it is about whether people feel the system works for them.

Choosing deregulation alongside the democratisation of opportunity offers a different future – one in which starting a business does not feel like a battle, young people can imagine careers beyond a few sectors, rural producers reach wider markets and success is not limited to those with connections.

Deregulation is not the end of responsibility. It is the beginning of a fairer, more open and more humane economic model – one that gives every citizen a genuine chance to shape their own future.