Foreign Aids And The Third World Developing Countries

3098 Words Jun 18th, 2015 13 Pages
Introduction:
As a developing countries Bangladesh can not meet its all demand by own economic ability so it takes foreign aid for implementing its development purposes. It has got foreign aid for its several development issues like Jamuna and Padma Bridge. Not only structural development is implemented by foreign aid but also several long term policy and projects are done by it. But the effectiveness of foreign aids to the third world developing countries like Bangladesh is a controversial issue. Liberal economists argue that aids both in the form of grants and loans can play vital role to the development of any country, if it is channeled through proper biding and use effectively to the development projects. In contrary of that, aid causes debt entrapment, dependency, domination etc. to the third world country like Bangladesh.
Some scholars like Jeffrey Sachs, Joseph Stiglitz, Nicholas Stern have argued that although aid has sometime failed, it has supported poverty reduction and growth in some countries, but critics such as Milton Friedman, Peter Bauer, William easterly have argued that aid has enlarged government bureaucracies, perpetuated bad governments, enriched the elite in the poor country or just been wasted.
Foreign aid both grants and loans has impacts on the economy of Bangladesh. It contributes to the development works like bridge, roads, highways, infrastructural works etc. Though prime focus of aid is economic development, aid has contributed to governance,…
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