Is Bangladesh prepped for smooth LDC graduation?

Bangladesh is scheduled to graduate from Least Developed Country LDC in 2026, in accordance with the government's plan. However, the graduation timeline has become a subject of debate amid volatile global and domestic economic conditionthat have influenced the country's readinessfor graduation.The talk of the country is whether this planned targetshould remain unchanged or be reconsidered. The private sector has expressed concern that Bangladesh is yet to be fully prepared for the transition. Many stakeholders believe that additional time is required to ensure a smooth and sustainable transition.

There are multiple parameters that Bangladesh needs to work on for the preparedness for a smooth transition. It is worth mentioning that skill is one of the key parameters for ensuring a sustainable LDC graduation. Theproposed Smooth Transition Strategy (STS) is built on five major pillars, and among them, one of the most important is Pillar Four: Building Productive Capacity, which includes skills realignment, emphasizes human capital development, and the upskilling & reskilling of the workforce and the creation of relevant competencies though these are inter-related.Moreover, the Human Asset Index, one of the three major indicators for LDC graduation, directly reflects the strength of a nation's skilled workforce. Therefore, to effectively transform Bangladesh's demographic dividend into productive human capital, skills development is inevitable. The 2025Labour Force Survey shows graduate unemployment has risen to 13.5%, nearly triple the national rate, highlighting a severe mismatch between education and labour market needs. The industry and academia gap has been prevalent to the large extent.

Skilled human capital development is the most critical strength for Bangladesh's desired economic transformation from LDC status and knowledge economy. However, several underlying issues continue to hinder the progress of skills and human capital development. In line with this, some core issues and concerns are highlighted, which actually hold back the desired skillsdevelopment and human capital development of Bangladesh. Skills development has long been identified as a priority area, the existing policies, development master plans are still not adequate enough to meet the changing and transformative needs of the country.

Bangladesh is envisioned to become a trillion-dollar economy by 2030 and a developed economy, but there is no clear roadmap to achieve these ambitious milestones. Due to emergence of 4IRs, 40% of current industrial jobs will be at stake throughout the world. 5.38 million sectoral jobs are stake due to automation locally. OECD forecastthat many of Bangladesh's existing skill sets are still rooted in traditional industries, reflecting competencies of 2ndIndustrial Revolution. These conventional skills are neither sufficiently scaled up nor widely promoted, let alone aligned with the needs of the 4IR. Therefore, skills mapping must now prioritize 4IR-related competencies for building a smart, technology-driven human capital base.To achieve this, greater attention must be given to develop skills related to emerging technologies such as the Internet of Things (IoT), blockchain, and Artificial Intelligence (AI)-based content development. It is important that 4IR technologies are applied across various industrial sectors. However, most of Bangladesh's major industries continue to rely heavily on conventional manufacturing systems and traditional operational models, which depend on outdated skill sets and limit productivity and innovation. Lackluster trend in vocational skills put us behind our peer economies like Vietnam, India and Philippines.

International standard occupation list and local state reported that "Computer training" is the top ranked skill followed by driving and Agri-work. The 4IR technology based skills at the vocational level does not exist while universities have not created graduates yet. This is an irony for our growing industrial base. We are dependent on foreign remittance through unskilled migration and this may not sustain if skills-based diversification is unattended. Due to massive technological development, the demand of unskilled and traditionally skilled workforce will be low and this market may be grabbed by other economies. In addition, we must address the social perception about vocational and technical education. Traditionally, vocational education is not viewed as a mainstreamed option within society, despite its proven acceptance.Globally, individuals equipped with practical vocational skills have higher employability compared to many graduates in liberal arts, science. It is high time for a cultural shift, a change in social attitudes and mindsets in Bangladesh to recognize vocational education as a respectable career path. Young people should be encouraged for pursuing vocational and technical training instead of general graduation. This would create a technically competent and vocationally qualified workforce for rapid industrial development, responding to global economic shifts, and meeting the growing global demand for skilled labour. Our skills' diversity and development should be based on local industrial landscape and intensity. In fact, district or division-wise industrial intensity should lead to specialised industrial mapping.

Taking these realities into account, it is anticipated that the country will face growing challenges in strengthening industrial readiness and ensuring self-sustenance. The economy must focus on import-substituting industries and domestic enterprises capable of meeting both local and global demands. LDC graduation will unveil a chapter for our economic future and that requires a paradigm shift in planning, implementation, and vision. In fact, skills can support better steer 3 graduation criteria.

In view of thegraduation, skill mapping is essential to align the workforce with evolving industrial and global market needsaiming at the sustainable transition. Without a nationwide inclusive skill mapping based on industry and academic tie, the country risks facing a mismatch between education output and employment opportunities, weakening its much-needed competitiveness. Therefore, the economic activities, policies, and institutional strategies must move in a coordinated approach, toward building an innovative, skill-driven and knowledge-based economy that reflects aspirationsof a self-assured, post-LDC Bangladesh.