The festival economy: A lifeline for Bangladesh’s informal sector

On 2 April, I came across a news report highlighting how the beach town of Cox's Bazar was bustling with visitors following a slowdown in the tourism industry during the month of Ramadan. The report indicated that during the Eid season, hotels in Cox's Bazar generated a gross turnover of around Tk 700 crore (approximately $65 million) within the first week after Eid, primarily driven by a large influx of domestic tourists.

This economic impact was further amplified by the high occupancy rates of hotels, motels, and resorts – some reports noted that over 90% of accommodations were booked in advance, with more than 100,000 tourists arriving daily.

Let us move from Bangladesh to an international example.

Consider the case of American pop star Taylor Swift's record-breaking concert tour. Beginning on 17 March 2023 and running through to 8 December 2024, the Eras Tour has become the highest-grossing tour of all time, generating an estimated $5 billion in economic impact.

According to Forbes, the six-show run in Los Angeles alone contributed USD 320 million to the local economy and led to the creation of 3,300 jobs. CNN reports that the tour has boosted the overall US economy by approximately $5 billion.

Meanwhile, The Economic Times notes that Swift earns around $13.6 million per show. Her tour has been widely credited with stimulating local economies through increased tourism, hotel bookings, and ancillary spending. The economic ripple effect extends well beyond ticket sales, impacting hospitality, transportation, retail, and a wide range of small and medium-sized businesses.

This is called the economics of festivals, and it has massive implications – not only in Bangladesh but across the world. The total value of the festival economy is not precisely known; however, it significantly contributes to many sectors. For example, the global music festival market is predicted to reach $24.46 billion by 2033, while the global tourism market was valued at $1.52 trillion in 2024.

Bangladesh is no exception. People often claim that Bangladesh hosts thirteen festivals over the course of twelve months. Among the country's major celebrations are Eid, Durga Puja, Christmas, Buddha Purnima, Independence and Victory Day, Pohela Boishakh, and Boshonto Utshob. In addition to these, the country celebrates many local festivals, including Baul Utshob, Lalon Utshob, and various urban and rural fairs, each contributing to the vibrant religious, cultural, and spiritual tapestry of the nation.

Let us narrow down the discussion to the 15 days from 30 March to 14 April of this year. During this period, the country observed three major festivals: Eid-ul-Fitr, Chaitra Sankranti, and Pohela Boishakh.

A 2024 study by the Bangladesh Shop Owners Association estimated that Eid boosts the economy with around Tk 1.7 trillion in turnover during Ramadan, most of which is generated by decades-old, non-branded retailers. This boost is fuelled by increased spending on food, clothing, travel, and other goods and services. The festival also sees a surge in remittances and a rise in the money supply.

In March 2025, targeting Eid-ul-Fitr, Bangladesh received a record-high $3.29 billion in inward remittances, marking the highest monthly inflow in the country's history – a significant 65% year-on-year increase. These stronger inflows reflect amounts that came through formal channels; the true figure, including informal ones, is likely much higher.

A 2024 study by the Bangladesh Shop Owners Association estimated that Eid boosts the economy with around Tk 1.7 trillion in turnover during Ramadan, most of which is generated by decades-old, non-branded retailers. This boost is fuelled by increased spending on food, clothing, travel, and other goods and services. The festival also sees a surge in remittances and a rise in the money supply.

There is no exact calculation of the total financial turnover or impact surrounding Pohela Boishakh celebrations. However, according to economists, the estimated economic activity generated around this festival may amount to approximately Tk 15,000 to 20,000 crore.

Government officials and employees receive more than Tk317 crore in Boishakhi bonuses from the state. In Bangladesh's fashion industry, half of annual sales occur during Eid-ul-Fitr, while around 25% of sales are driven by Pohela Boishakh-related purchases.

In addition to these headline numbers, festivals offer a platform for small vendors, artisans, and temporary workers, thereby supporting the informal economy. In today's rapidly changing economic landscape, small businesses hold the key to fostering sustainable growth and driving local economies.

In rural Bangladesh, the arrival of Pohela Boishakh brings with it the colourful bustle of Boishakhi melas – traditional fairs that breathe life into the local economy. These fairs are more than just celebrations; they are vital commercial hubs. Handmade goods are sold in abundance, and households often purchase their yearly supply of utensils and furniture from these temporary markets.

For children, the fair is a magical experience – clay dolls, bamboo flutes, colourful balloons, drums, bead necklaces, imitation jewellery, and glass bangles fill every corner. Stalls pop up selling sweets and snacks, and artisans display cane-made crafts and rustic furniture.

Rural merchants, while busy with sales, also engage in the tradition of opening new account books for the new year – a practice known as haalkhata. It is not just about closing old accounts and settling debts – it is also about renewing customer relationships for the year ahead.

For the hundreds of thousands of artisans and craftsmen across Bangladesh, the Boishakhi mela presents a window of opportunity. It offers a lifeline – some business owners run at a loss all year long, hoping to recover during the festival season. The pre-Pohela Boishakh rush in urban tailor shops has become almost mythical.

As the festival nears, people rush to return to their hometowns. This mass movement significantly impacts the transport sector. Tourism also receives a boost, as many travel to enjoy celebrations – either returning to their roots in rural areas or heading to urban centres like Dhaka to witness the grandeur of city festivities.

Some choose to escape altogether, travelling to tourist hotspots like Bandarban, Khagrachari, Cox's Bazar, or Sylhet. Whether alone or with family, these seasonal journeys spark spending across sectors.

Living in Belgium, I have observed similar patterns. Even here, the festival economy plays a crucial role. Restaurants that barely survive during the year come alive in summer. During Christmas, the month-long festive markets sustain many businesses for the entire year.

But when these festivals are politicised, when they begin to reflect a particular party's ideology, when fear is incited through mob intimidation, or when fairs that have continued for generations are abruptly shut down – the consequences are dire. The impact falls squarely on ordinary people.

If religious and cultural festivals cannot be separated from politics, the effects spill over into commerce. When political agendas infiltrate festivals, supporters of rival groups may boycott them – directly impacting sales and attendance, as we recently saw with this year's Ekushey Book Fair. Similarly, when religious excuses are used to shut down festivals, the most significant blow falls on local economies and livelihoods.

Festivals are not just celebrations in Bangladesh – they are a form of economic circulation, like the blood flow that keeps a body alive. And for the nation to remain standing, this circulation is not just welcome – it is essential.

Therefore, if we can keep festivals safe, inclusive, and free from political influence, their economic benefits will reach people from all walks of life – not only urban business owners, but also rural artisans, roadside ice cream sellers, temporary stallholders, and performers who bring fairs to life with music and dance. For many, festivals are not just moments of joy – they are a means of survival.

Sketch: TBS

Mohammed Norul Alam Raju is a researcher and development activist, currently residing in Belgium, pursuing higher studies in Development Policy and Management. The writer can be contacted at raju_norul@yahoo.com.

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.