How 100% electrification changed the rural game

Originally posted in The Business Standard on 14 March 2022

Even 10 years ago, when night fell, villages would sink in pitch black darkness. Life used to come to a near standstill in rural Bangladesh as urban areas were prioritised for power supply

How 100% electrification changed the rural game


More than a decade ago, Nasir Uddin, a retired BGB member from Bhola’s Jahanpur village, tried his luck at various businesses with his pension money of Tk12 lakh, but nothing paid off.

After a brief not-much-fruitful stint at farming, he eventually parked his money in a bank and would pass idle time.

And then came 2014 as a watershed in his life – electricity reached Jahanpur and the whole village lit up. After some toing and froing, Nasir ventured into poultry farming and invested Tk2 lakh.

In no time, it proved to be a success – with the electricity connection at his home, he was able to easily run the temperature-controlled hatching equipment.

This is a vivid example of how electricity emerged as a game-changer in rural life and economy. Bangladesh’s four decades of approach for fast expansion of rural electrification coverage has already started giving dividends.

An electricity connection has changed a village – it has brightened the reading table of kids, relieved worry for charging mobile phones and helped youths set up a poultry farm or welding workshop. It has made life faster and easier in the remotest of the villages, spurred economic activities that have increased incomes and created jobs. It has given business to electrical and electronic home appliances and support services.

Fast forward to 2022, poultry farming apart, Nasir has also entered into fish farming and become a successful entrepreneur with his capital reaching more than Tk1 crore. Some 30 people are employed in his farms. He is now planning to set up a feed mill and hatchery.

Infographic: TBS

“Electricity has made me an entrepreneur. I have also created jobs for many,” Nasir Uddin told The Business Standard.

After retirement Nasir bought a black and white TV to spend time and it would run on battery as there was no electricity in his village.

To recharge the battery, Nasir had to travel 13 kilometres to the upazila town.

He could watch news two times and one or two other programmes on the TV a day on a single charge, he said.

Even 10 years ago, when night fell, villages would sink in pitch black darkness. Life used to come to a near standstill in rural Bangladesh as urban areas were prioritised for power supply.

But things have changed completely, thanks to electricity connections.

Since 2012, the country has seen a rapid growth of solar energy in remote areas as only two-thirds of rural households had access to grid electricity. It gave about 73 lakh people in remote rural areas access to solar energy till 2020, enough to light bulbs and charge mobile phones.

The scenario has changed with the expansion of grid electricity on the back of increased generation capacity. With access to electricity, people are finding new ways to increase their income, and the word is spreading quickly across villages.

Electricity was believed to be a privilege of the urban people until Bangladesh launched an extensive rural electrification programme in 1977 with assistance from development partners.

Now, Fulchhari char in northern Gaibandha district can boast of having a plant that makes auto-rickshaw chargers.

“Inhabitants of chars in Gaibandha and Jamalpur districts no longer have to use solar panels as they now get grid electricity which helps them use refrigerators and set up rice mills,” said Sheikh Manuar Morshed, general manager of Gaibandha Palli Bidyut Samity, one of 80 community associations through which Bangladesh Rural Electrification Board (BREB) extends its services across the country.

Of total 492 upazilas, 461 upazilas have 100% electricity coverage, says BREB, which had a declared goal of universal electricity coverage by 2021.

Bangladesh’s power generation capacity has registered a nearly five-time rise to 25,000 megawatts since 2010-2011. All people now have access to electricity with a three-fold rise within a decade, according to the Power Division.

On the other hand, per capita income increased to $2,900 from $750.

The rural economy has now crossed Tk25,00,000 crore from Tk700,000 a decade ago.

The introduction of battery-run easy bikes has also contributed to rural economic growth.

For example, Idris Ali, a youth from Rajshahi’s Bagmara, who could not continue his study after HSC because of poverty, now earns Tk600-Tk700 a day with his easy bike.

“I have power connection and I can maintain my livelihood with my easy bike,” he said.

More than 5 lakh people have found the means of earning in easy bikes and come out of poverty.

The last decade has also witnessed a revolution in the country’s ICT industry. There are now more than 2,000 ICT institutions registered with the government. The industry created more than 1 lakh jobs.

Industry people believe that uninterrupted power has played a big role in the development of ICT. At the same time, union digital centres are also a big benefit of electrification, they point out.

Dr Hossain Zillur Rahman, executive chairman at Power and Participation Research Centre, said “Since 2010, the use of electricity has increased by five-six times. There has been a massive change in communication and housing. Many young people are taking up poultry and fisheries farming.”

Recent years have witnessed a sea change in the rural economy and the people’s lifestyles mainly because of a massive expansion of power lines to rural villages, he noted.

Besides, booming urbanisation in keeping with power expansion has spurred job creation across the country, he added.

FBCCI Vice-President MA Razzak Khan, also chairman of Minister Group, the cent percent electrification across the country coupled with a rise in people’s purchasing power has massively contributed to the growth of electrical and electronics products and created jobs for many.

A brief that examined 50 impact evaluation studies tells the miracle of rural electrification in American villages; 7% increase in school enrolment, 25% in employment and 30% in income.

A 2021 analysis done for a Tennessee State University College of Business journal on impacts of rural electrification in Bangladesh suggests electrification reduces 81% household consumption of kerosene, thus contributing to carbon emissions. Electrification increases weekly working time by 2.21 hours, evening study time of students by 21 minutes per day, it finds, justifying continuation of subsidised electrification for the lowest-tier electricity consumers in Bangladesh.

A silent growth of agriculture, poultry

After getting electricity in 2015, Nur Nabi started a rice and soybean processing mill, the first of its kind in the country’s southern region in Char Mansa village of Laxmipur. As a result, rural farmers are getting fair prices for their produce and their transportation costs have come down too.

Nur Nabi said it would not have been possible to run such a large mill without electricity. At present, around 30 workers are engaged in the factory every day.

Many rice mills have been set up all in villages over the country after expansion of electricity connections.

Dr FH Ansarey, president at ACI Agribusinesses, said over the past decade, the country’s production of food grains and fish, meat, eggs, milk, fruits and vegetables has multiplied. In 2008-09, the production of small fish was 67,000 tonnes, which has now reached 2.5 lakh tonnes.

Various fishes are also being cultivated. The number of hatcheries now stands at about 1, 000 from about 100 a decade ago.

Investment in the poultry sector has increased from Tk35,000-Tk40,000 crore from only Tk10,000-Tk12,000, he noted.

The country has become self-sufficient in egg production and it is also on the way to achieving self-sufficiency in beef production. The number of poultry farms alone is more than 20 lakh with at least 5o,000 people employed. The government has more than 50,000 farms in its “One House, One Farm” project, he added.

File Photo: Mumit M/TBS

The five-fold rise of cable industry

The size of the domestic cable market has grown from Tk2,000 crore to Tk12,000 crore over the past one decade thanks to nationwide electrification coupled with massive infrastructural development and burgeoning industries.

More than 120 companies, including big brands, have come forward with hefty investments, creating over 50,000 jobs in the sector, Md Anisur Rahman, president of the Bangladesh Electrical Cables Manufacturers Association, told TBS.

Large industrial groups, including BRB, BBS, Partex, Pran-RFL, SQ, Paradise, Walton have emerged centring on the industry.

Over 10 lakh jobs in electrical, electronic sectors

Massive electrification in rural areas has chipped in to take the domestic market of electrical products, worth Tk10,000 crore, to a five-fold growth just in a decade.

For selling electric products, such as fan, light, switch, circuit breaker, cable and generator, around 60,000 retail shops have sprung up across the country since 2010.

Mainul Islam Bhuiya, president of Bangladesh Electrical Merchandise and Manufacturers’ Association, told TBS that many companies, such as Walton, RFL, Energypac, ACI, BD Lamps, Mohammadi Electric, Super Star, BRB, BBS, Partex, Paradise, and MyOne, have stepped up in manufacturing electrical products. At least 3,000 small entrepreneurs have also ventured into it.

From production to marketing, at least 5 lakh jobs have also been created over the last decade. A big portion of them is from villages, he also said, adding that luxury now adds to essential use of electric products and there is also a massive rise in demand in different industries

Orion Home Appliances TV. Photo: Salahuddin Ahmed/TBS

On the other hand, the consumer electronics market has grown to Tk30,000 crore. The 100% electrification coupled with a tax break for new investment was a shot in the arm, propelling local manufacturing of electronics products. Prices of products, such as mobile, refrigerators, air conditioners, fridge, washing machines, and microwave oven, have halved over the last decade as demand has increased significantly because of a massive electrification across the country.

At least 14 local and foreign brands have stepped up with investments in the industry and created five lakh direct and indirect jobs.

Mesbah Uddin, chief marketing officer at Fair Group, a company that manufactures and markets Korean giant Samsung’s products in Bangladesh, said demand for electronics and home appliances has increased owing to the expansion of electricity in the country and changes in people’s living standards.

These products have made people’s lives easier and changed the rural economy, he added.