Bangladesh has experienced substantial reductions in both extreme poverty and poverty. The proportion of the population living below the national extreme poverty line has reduced from 50% in 1991 to 18% in 2010 while the poverty headcount ratio, using the national poverty line, has reduced from 60% to 32% over the same period. Economic growth, increased non-farm employment (particularly in the ready-made garment industry), international migration and investments to improve human development outcomes have all contributed strongly to this success. However, some households escape poverty only to live at a level just above the poverty line: 19% of the population lives out of poverty, but has a level of consumption less than 1.25 times the national poverty line. They therefore remain vulnerable to slipping into poverty in the event of a shock or stressor, such as an episode of ill health or a flood.
The specific focus of this report is on 'transitory poverty escapes', a term referring to households that successfully escape from poverty only to return to living in it once again. In other words, they become re-impoverished. Analysis of the Chronic Poverty and Long-Term Impact Study for this case study reveals that transitory poverty escapes are a significant phenomenon in rural Bangladesh. In particular, between 1997–2000 and 2010, 10% of all households experienced a transitory poverty escape. Of those households that escaped poverty between 1997–2000 and 2006, around 20% were again living in poverty by 2010.