The AI-driven economic flywheel

Somewhere in rural Bangladesh today, a farmer is making decisions about crops, weather and markets with access to a fraction of the information available to a large commercial enterprise.

A village student is learning with resources that pale in comparison with those available to a child in Dhaka. A small entrepreneur is navigating business challenges without the expert guidance available to larger competitors.

This is not a story of individual failure. It is a story of systemic distance from opportunity — and it is precisely the kind of distance artificial intelligence can help close.

Bangladesh has spent five decades proving that it can solve difficult development challenges. It has lifted tens of millions out of poverty, built globally competitive industries and established itself as a rising economic force. But every development journey reaches a point where past success alone cannot guarantee future prosperity.

Bangladesh is approaching that inflection point.

The country should not approach AI simply as a technology agenda. It should see it as one of the most consequential economic transformation opportunities available to a developing nation this century.

AI as a national productivity multiplier

The first strategic imperative is to recognise AI as a national productivity multiplier, not simply a threat to employment.

For a country with a workforce of more than 170 million people, the question should be how AI can help workers create significantly more value.

Early evidence is encouraging. Research by Stanford's Erik Brynjolfsson and MIT's Danielle Li has found that generative AI can significantly improve worker productivity, with particularly large gains among less experienced workers.

The European Central Bank has also estimated that widespread AI adoption could generate substantial productivity gains over the coming decade.

The significance goes beyond efficiency.

AI can help narrow the gap between experienced and inexperienced workers by putting expertise within reach of more people. It can help a new employee perform tasks that once required years of experience. It can allow a small business to access analytical capabilities that were previously affordable only to large corporations.

For Bangladesh, this matters enormously.

AI-enabled public services can automate routine processes, identify anomalies, improve fraud detection and support data-driven decision-making. Digital procurement systems can flag irregularities. Interoperable systems for digital identity, payments and data exchange can allow governments to provide services around citizens' needs rather than forcing citizens to navigate fragmented institutions.

Imagine teachers using AI to personalise learning for individual students; healthcare workers supported by AI-assisted diagnostics; farmers receiving real-time guidance on weather, crop disease and market prices; and small businesses accessing market analysis, financial advice and operational expertise through a mobile device.

These are not necessarily examples of jobs disappearing. They are examples of human capabilities being multiplied.

An engine of inclusive prosperity

The second strategic imperative is to use AI to extend economic opportunity beyond the traditional centres of privilege.

Throughout history, access to quality knowledge and expertise has been shaped by geography, income and institutional access. Urban centres have enjoyed advantages over rural communities. Large enterprises have had access to expertise that smaller businesses could not afford.

AI has the potential to change that equation.

The World Bank's work on digital development highlights the potential of AI to expand access to knowledge, services and economic participation in developing countries. Bangladesh already has evidence that digital technologies can reach extraordinary scale. Its mobile financial services ecosystem, with more than 239 million registered accounts, demonstrates how quickly digital platforms can become embedded in everyday economic life.

The next step is to democratise access to knowledge and expertise.

If finance can be democratised at scale, so can knowledge.

That would make AI not merely a technological advance, but a development instrument capable of changing the conditions under which millions of Bangladeshis learn, work and build businesses.

Digitalisation as an antidote to systemic corruption

The third strategic imperative is perhaps less discussed but equally important: using digitalisation and AI to reduce the space in which corruption can operate.

Corruption is often framed as a moral failure. It is also a systems problem.

Where processes are opaque, discretionary and paper-based, opportunities for rent-seeking and abuse multiply. Where processes are digital, standardised, traceable and auditable, those opportunities become harder to exploit.

Digitalisation creates visibility. AI can add intelligence to that visibility.

Together, they can strengthen accountability.

AI-enabled public services can automate routine processes, identify anomalies, improve fraud detection and support data-driven decision-making. Digital procurement systems can flag irregularities. Interoperable systems for digital identity, payments and data exchange can allow governments to provide services around citizens' needs rather than forcing citizens to navigate fragmented institutions.

This matters economically as much as institutionally.

Trust, therefore, is not a soft outcome. It is an economic asset — and a critical accelerant of the AI-driven economic flywheel.

But building that trust will require more than technological deployment. It will require strong institutions, clear rules, data protection, accountability and safeguards against the misuse of AI.

The ultimate nation-building platform

The fourth and perhaps most defining strategic imperative is to position AI adoption as a nation-building project.

Bangladesh's greatest AI advantage may not be its ability to invent frontier AI models. It may be its ability to adopt and deploy AI at scale.

Previous waves of development often required decades of institutional and physical infrastructure before their benefits could be realised. AI offers developing countries the possibility of compressing parts of that journey.

Countries become prosperous not only by inventing technologies, but by adopting them quickly and adapting them to their own economic needs. Bangladesh has demonstrated that it can do something similar.

The rapid expansion of mobile financial services and the digitisation of public services through initiatives such as a2i show that the country has experience taking digital platforms from policy ambition to mass adoption.

AI can be the next step.

The policy priorities are clear. Bangladesh needs investment in digital infrastructure, trusted digital identity systems, AI literacy, data governance, cybersecurity and regulatory frameworks that encourage responsible innovation.

Businesses, meanwhile, must treat AI primarily as a tool for workforce augmentation and productivity growth rather than simply a mechanism for reducing headcount.

For international investors, the opportunity is equally significant. Bangladesh should no longer be viewed solely as a manufacturing destination. It has the potential to become a major platform for AI-enabled development across emerging markets.

Making the flywheel turn

The opportunity, ultimately, is about connecting AI to the broader machinery of economic development.

Digitalisation can make economic activity more visible. Greater visibility can improve transparency. Transparency can strengthen institutional trust. Trust can attract investment. Investment can expand businesses and generate more data. Better data can make AI systems more effective. And more effective AI can raise productivity across the economy.

That is the flywheel.

But a flywheel does not turn automatically. It requires an initial push, sustained investment and alignment across institutions.

For policymakers, that means creating the infrastructure and rules that allow AI to scale responsibly. For businesses, it means investing in people and redesigning work rather than simply automating existing processes. For investors, it means recognising that Bangladesh's opportunity extends beyond low-cost production towards technology-enabled productivity and services.

The next economic leap may not be about building more of what Bangladesh already builds.

It may be about making every worker, every business, every institution and every community capable of building more with what they already have.

Abdullah Khan is the CEO of ImpactX Bangladesh, a digital advisory firm.

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.