It is a great pleasure to have the opportunity to meet with you this evening and to be able to say a few words about the way DFID is supporting development in Bangladesh and about our proposals for the future.

At present, we spend about £70 million per year in Bangladesh our second largest programme anywhere; this is an increase from about £40 million in the mid 1990s. We support about 70 projects and programmes in a wide range of sectors. I have prepared two bar charts which are circulating which will give you some impression of the present scope of our programme.

We in DFID are in the process of considering our future strategy for supporting Bangladesh and our intention is to produce a new strategy in April next year. This is therefore a very opportune moment to meet with you. I believe that the British Bangladeshi community has a large contribution to make both to assisting Bangladesh and to help us to decide the best form of our support.

I would like to share with you today some of the ways in which our thinking is developing and to hear your views.

The popular image of Bangladesh one too often depicted in the media is one of disasters and massive poverty. In fact as most of you will be aware the picture is much more complex than that. There is of course still an unacceptable amount of poverty in the country but Bangladesh has made massive improvements over the last 20 years.

Growth has been steadily positive about 2% per annum per head and rather higher in more recent years. This has brought poverty steadily down by about 1% per year. Population growth rate has come down from 2.9% per annum in the mid seventies to 1.6%. Life expectancy has increased to sixty years. Infant mortality and child malnutrition have steadily declined. These are remarkable achievements.

However, very large problems remain. About 50% of the population still live in poverty and about a third in extreme poverty. It is the most densely populated in the world and yet the population is expected to increase from its present 130 million to over 200 million before it stabilises. The economic base of the economy remains heavily dependent upon Garments which comprise 70% of exports and which face a threat with the opening up of world trade regimes in 2004.

In the past the purpose of development assistance was generally thought of as filling gaps. Poor countries were short of capital therefore they needed financial aid; normally provided through projects. They were also short of skills which donors could provide in the form of technical assistance such as long or short-term experts and training.

But we have a learnt a lot about what is necessary for sustainable development both in Bangladesh and elsewhere. We have seen too many cases around the world where the provision of financial aid and training have failed to bring about development. The sad record of development in sub Saharan Africa inspite of large inflows of Overseas Development Assistance are a graphic illustration that more is needed than merely money and expertise.

In particular, we have recognised that development depends as much, if not more, on the policies adopted by developing country Governments and the structure and conduct of their institutions as it does on the resources available to them. This is particularly relevant in Bangladesh where because of the success of the economy the country is no longer aid dependent.

Aid accounts for as little as 2 to 3 % of GDP and 20% of the Government budget compared to much larger percentages even a decade ago.

This does not mean that aid is unimportant, or that it cannot make a difference but it does require us to rethink what the focus of that aid should be.

Ideally we would wish to use our aid to support the policies and programmes of the Government. However too often in Bangladesh the operation of the institutions and the political system is such that poor people receive little benefit from Government programmes. This is one reason why we and other donors have often resorted to supporting the programmes of NGO's which tend to be better at reaching poor communities.

But this is not enough. For a sustained and lasting attack on poverty Government systems and policies have got to be improved. There is no country in the world that has eliminated poverty without an effective public sector. We believe that it is the poor performance of the public sector that is now the major constraint to faster development in Bangladesh.

So in all sectors, we now put an increased emphasis on improving the performance and capacity of the institutions with which we work. For example, we have a major programme in the Ministry of Education improving the management of schools. We are improving the ability of Roads and Highways Department to plan the maintenance of the road network and we have a major programme improving financial management in the Ministry of Finance and other key ministries.

We are developing new programmes for example in the Charlands (shifting sand islands in the main rivers) and with BRAC (largest NGO in Bangladesh) that specifically direct assistance to some of the poorest and most vulnerable people in the country. We are particularly concerned at the position of women who are among the poorest and most disadvantaged in society.

We place enormous emphasis on the education of girls: which is known to have major impact. Better-educated girls marry later, and their children are better nourished. But there also needs to be change in the way the society in Bangladesh views the place and contribution of women. I wonder whether there is not a role here for you with you experience of the benefits of a wider role for women in society to play a stronger role in advocating this in Bangladesh too.

We are expanding our programme in new areas. We are all conscious that Government institutions and political leaders rarely respond to the needs of poor people. We are working with a new range of partners, NGOs and community associations who work to mobilise groups of poor people so that they can better express their views and put pressure on Government institutions for better services, for example, Nijera Kori (An NGO for participation in consciousness raising through action) and Samata (Advocacy organisation).

There are parallels here with the approach we are taking here in Britain with the neighbourhood renewal programmes. Where we are also seeking to mobilise greater involvement of the communities to better meet the needs of the poor.

Governance issues are central concerns. There are a number of aspects to governance.

One is security. There is a perverse culture of lawlessness. The police are ineffective or worse and poor people tend to be the worst affected: having no recourse to powerful connections but as this community will be only too well aware from the distressing case of Surat Miah that no one is immune from the effect of lawlessness.

Improving Governance also includes improving the standards of transparency and accountability in public life. For example changing the systems that allow employees of public organisations to extract revenue from bribes, be that teaching, collecting water bills or installing telephones. We are developing a programme with Transparency International to expand their Committees of Concerned Citizens to put pressure for better services in all parts of the country.

Governance also involves the way Parliament works and the ability of Parliament to call Government to account. At present few MP's see this as their role but we are working to help improve the functioning of parliamentary committees. Governance also includes improving the environment for the private sector and foreign and investment. the private sector is vibrant in Bangladesh but is held back by the poor performance of Government . At present there is too much arbitrary application of taxation laws and other regulations that is deterring foreign investment. For example the recent unannounced imposition of additional visa restrictions on visitors.

Bangladesh is competing in an increasingly globalised economy. Neighbouring countries are liberalising and setting up investor friendly regimes: witness the spectacular success of the Computer Software industry in India. Bangladesh could do the same but they have yet to realise some of the realities of completing in today's global world.

There is a role here for you, the expatriate Bangladeshi community to make your views heard and help the Government of Bangladesh realise the adverse impact which some of their policies and actions have on outside perceptions of the country.

I know that you have close links and concern for the area of Sylet. However Sylet will only prosper when Bangladesh prospers. It is not an island. I would encourage you to explore ways to use your unrivalled connections to lobby for better polices for all Bangladeshis. We for our part do support programmes in Sylet for example our renovation of Sylet hospital and support to the education programmes of FIVEDB.

We do not have all the answers by any means as to how best to support sustainable development in Bangladesh. I hope that we can draw on your experience and knowledge as we seek to design our new country plan. The Head of our office in Dhaka Mr Paul Ackroyd is here tonight and I hope that this can be the first step in a closer association between the British Bangladeshi Professional Association and our development programme