The climate risks pose an existential economic and human challenge for Bangladesh, as highlighted in the World Bank's report, 'From Risk to Resilience: Helping People and Firms Adapt in South Asia,' recently published. The report identifies Bangladesh as a focal point of the climate crisis, with its dense population and vulnerable coastal geography exacerbating risks. By 2030, nearly 90 percent of South Asia's population is expected to face extreme heat risks, and a quarter will be threatened by severe flooding. Crucially, the report emphasizes that the adaptation burden exceeds the capabilities of the public sector, necessitating a transition towards private sector-led resilience for the country's future.
For decades, the narrative surrounding Bangladeshi resilience has emphasized grassroots survival strategies in the face of climate risk. The World Bank highlights that over 75% of households and businesses anticipate a weather-related shock in the coming decade. This heightened awareness has motivated significant adaptive measures: approximately 80% of households and 63% of firms have begun implementing strategies such as constructing elevated plinths, altering crop patterns, and making localized adjustments to enhance their resilience.
These actions reflect basic, low-cost solutions demonstrating the ingenuity of the Bangladeshi population; however, they fall short in addressing the crisis comprehensively. A survey of 250 coastal villages revealed a significant need for climate-resilient infrastructure. Households reported that inadequate disaster protection and limited financial resources hinder their safety and resilience. The current adaptation strategy is characterized by fragmentation and lack of sufficient funding, further complicated by the failure to utilize advanced technologies necessary for protecting millions. Consequently, the poorest and agricultural households are disproportionately affected, highlighting that climate change exacerbates inequality rather than being a neutral threat.
The World Bank's Mandate: A Fiscal Necessity: The World Bank emphasizes a pragmatic approach, highlighting that public investments such as embankments, cyclone shelters, and social assistance programs have effectively saved lives and minimized damage. However, the government's capacity to finance ongoing infrastructure and social safety net requirements is nearing its limits. According to Jean Pesme, a Division Director at the World Bank, although adaptation measures are common, the escalating climate risks necessitate increased action, which the public exchequer is unable to provide due to fiscal constraints.
This document emphasizes the World Bank's recommendation for the government to strategically support a comprehensive policy package aimed at leveraging private sector potential. It points out that substantial funds necessary for climate adaptation are currently unused in private accounts, awaiting appropriate market signals and regulatory frameworks. The findings indicate that approximately one-third of climate-related losses could be mitigated if the private sector could manage its resources and investments more effectively in reaction to climate pressures.
It suggests that the government's function should evolve from being the exclusive provider of climate security to serving as the primary facilitator and risk manager for resilience initiatives led by the private sector.
The Blueprint for Action emphasizes the need for Bangladesh to implement a private sector-led resilience strategy. This strategy should involve a multi-faceted approach that enhances institutional frameworks, encourages private investment, and safeguards vulnerable populations.
The government should focus on establishing a supportive environment for private investment by enhancing essential public goods aimed at reducing systemic risks. This approach emphasizes the importance of proactive governmental action in fostering adaptation and resilience against various risks.
Massive infrastructure development is essential, focusing on resilient public goods such as upgraded embankments, roads, and health systems in climate hotspots. Key infrastructure like durable roads keeps supply chains operational, safeguards firm revenues, and encourages investment in vulnerable regions.
Scaling Early Warning Systems (EWS) is imperative, requiring expansion through digital networks and real-time data. The report emphasizes that an effective EWS has historically reduced fatalities in Bangladesh, serving as a vital tool for households and firms to make informed adaptation decisions.
Private firms and households in Bangladesh are relying on basic financial tools due to a lack of advanced financial solutions. To transition from low-cost to high-tech financing, improvements are necessary.
Expanding access to formal credit and insurance is crucial for adaptation finance. The government needs to collaborate with the financial sector to create and subsidize climate insurance and credit products. This strategy should involve innovative risk finance solutions that pool and transfer risks, enabling households and small firms to recover quickly and invest in resilience.
Green investment incentives should include targeted tax breaks, subsidies, and preferential lending rates for companies investing in climate-smart agriculture, water purification technologies, and resilient building materials, transforming adaptation into a competitive business advantage.
Resilience requires that the poorest are not excluded, as the private sector alone cannot ensure adequate social protection; hence, this responsibility falls to the government.
Social assistance programs should be more flexible to quickly address climate shocks, offering temporary income support and rebuilding capital, while specifically targeting poor and agricultural households that are most affected by climate-related losses.
Improving digital connectivity and transport networks is essential for enhancing access to jobs, education, and health services during and after climate events. This adaptation measure not only protects human capital but also enables firms to operate remotely and diversify their risk exposure.
Bangladesh serves as a critical test case for climate adaptation in South Asia, with a unique opportunity to enhance local-level adaptation through strong collaboration between the government and the private sector.
Bangladesh can enhance resilience by strengthening institutions, investing in essential public goods like infrastructure and early warning systems, and fostering a financial environment conducive to private innovation. Addressing climate challenges is integral to achieving long-term prosperity, as coordinated actions aim to reduce vulnerability and promote inclusive progress despite adverse conditions. Urgent transformative public-private initiatives are needed now.
By strengthening institutions, strategically investing in foundational public goods like infrastructure and early warning systems, and creating the financial landscape for private innovation, Bangladesh can empower its households and firms to take the next, necessary leap in resilience. The path to long-term prosperity is no longer separate from the climate challenge; it is contingent upon it. Prioritizing these coordinated actions is not just about reducing vulnerability; it is about building a future that is both resilient and truly inclusive, ensuring that progress continues even when the floods rise and the heat bears down. The clock is ticking, and the time for this transformative public-private action is now.
The writers are faculty members, Department of Journalism and Media Studies, BGC Trust University Bangladesh
