In Dhaka, a prime minister’s ‘vendetta’ is shaping politics

At its grand opening last June, Bangladesh’s prime minister, Sheikh Hasina Wazed, referred to the new Padma Bridge as a symbol of national pride and self-reliance. Fighter jets flew overhead leaving vapour trails in the colours of the national flag, as thousands watched from the banks of the Padma river, the main channel of the Ganges in Bangladesh. Helicopters buzzed overhead, towing banners with the slogans “A dream come true” and “Hail Bengal”, while the prime minister became the first person to pay a toll on the 6km bridge, the longest in Bangladesh.

Dressed in an elegant, flowing sari and sunglasses, Sheikh Hasina applied a manicured hand to a white button and, as sparklers flared, a red curtain lifted slowly to reveal a mural of her and her late father, Sheikh Mujibur Rahman, who led the country to independence in 1971. Invoking his memory, she told the crowd that “Bangabandhu”, as he was known, “made us learn to stand with dignity and pride”. She spoke of the challenges of building a bridge over a river with the second strongest current after the Amazon. “Bangladesh never backed down and never will,” she declared of the $3.6bn project. The country had been forced to finance it on its own after the World Bank withdrew its backing 10 years earlier.

The prime minister’s remarks took on a more menacing tone when she appeared to directly target Bangladesh’s most prominent private citizen, Nobel Prize winner Muhammad Yunus. Now 82, Yunus is credited with pioneering microfinance, an idea that has lifted hundreds of thousands worldwide out of poverty. His Grameen Bank has foreign supporters ranging from Hillary Clinton to Jennifer Lopez. Referring to the “local MD of a bank with a strong western link” who had “developed an enmity with the government”, Sheikh Hasina told her audience that he “took out his anger” on the bridge plan, causing the World Bank to back out by making a false allegation of corruption involving the government. (When the Washington lender declined to loan the project money in 2012, it cited corruption concerns.)

Yunus went unnamed, but Bangladeshis had no doubt who she was talking about. Sheikh Hasina, who at 75 is more or less Yunus’s contemporary, has in the past repeatedly referred to the economist as a “bloodsucker” of the poor. Nor was it the first time she had aired allegations that he engineered the World Bank’s pull-out. Her invective has ramped up lately, however, and on at least one occasion been laced with what sounded like a violent threat.

In a speech in May, which mentioned Yunus by name, Sheikh Hasina said he should be “plunged into the Padma river twice”. Addressing a meeting of her party, the Awami League, which her father co-founded in 1949 then led during Bangladesh’s struggle for independence, she added, “He should be just plunged in a bit and pulled out so he doesn’t die, and then pulled up on to the bridge. That perhaps will teach him a lesson.”

Observers of Bangladeshi politics see the speeches as a significant moment and an early warning that the country is sailing into choppier political waters ahead of a general election this year. Bangladesh, with more than 160 million residents, is one of the world’s most populous countries. Not long ago, it was also among the poorest, until a successful garment industry transformed it into one of the world’s leading clothing exporters. But Covid-19 and the spike in the price of imported energy since the war in Ukraine have threatened to reverse some of these gains, as has a darkening political atmosphere which, democracy campaigners say, is making Sheikh Hasina’s Bangladesh an increasingly repressive place.

Today, getting a visa to report here as a foreign journalist is difficult. Government officials are keenly sensitive to criticism. But late last year, I obtained an invitation to cover “Made in Bangladesh Week 2022”, a trade event. Bangladeshi politics was not on the agenda during the day, when government officials escorted me in a van to interview other government officials and industry bosses.

After hours, though, the feud involving the prime minister and Yunus, which has resurfaced periodically over the years, was the talk of Dhaka’s local and diplomatic elites. Several Bangladeshis I spoke to called it a “vendetta”, though most did not want to be quoted or even meet in person for fear of attracting the attention of Bangladesh’s security services or causing trouble for their co-workers.

Sheikh Hasina, who won office in 2014 and 2018 after elections that some eyewitnesses described as fraudulent, will soon face voters again. But this time the economy, fuelled almost entirely by clothing production and remittances from Bangladeshis working overseas, is slowing. Her government faces pressure from its donor countries, including the United States, to run a fairer vote.

A number of people told me that there was paranoia in the ruling camp that Yunus, who briefly dabbled in politics more than a decade ago, could emerge as a political rival. He disavows any such ambitions but as Asif Nazrul, a professor of law at the University of Dhaka, told me: “There is a strong perception among the ruling party that Dr Yunus is very powerful, has a strong connection with the Biden government and Hillary Clinton in America, and is anti-Awami League — and that he may play a role if the international donor community wants a free and fair election.”

Bangladesh Prime Minister Sheikh Hasina
Bangladesh Prime Minister Sheikh Hasina © Daniel Leal-Olivas/WPA Pool/Getty Images

It’s a tale of two contrasting and bitterly competing visions. On one side, Asia’s most powerful female leader, the daughter of the man Bangladeshis call the father of the nation; on the other, a man whose acquaintance with some of the most influential people in the world helped build Grameen Bank from scratch, but also made him vulnerable to accusations he was a tool of foreign interests. And it seems inevitable that, as polling day moves closer, Dhaka will continue to turn up the heat on Yunus.

In July 2022, the Bangladesh Anti-Corruption Commission (ACC) opened a probe into alleged embezzlement by Grameen Telecom, which holds a third of shares in Bangladesh’s biggest mobile operator, Grameenphone. (Norway’s Telenor is the controlling shareholder.) Yunus’s supporters worry that it could have legal implications for him and the bank, while some observers believe it might hurt broader investor confidence in Bangladesh. “Grameenphone is one of the top taxpayers in Bangladesh,” said a foreign diplomat who asked not to be quoted by name. “And Muhammad Yunus is a highly respected and well-loved person who has defenders around the world.”

In her bridge speech last summer, Sheikh Hasina described the project as a symbol of progress in a region riddled with bad transport links. A few weeks ago, my escort van took 10 minutes to make a journey that, before it was built, took up to eight hours by ferry, including waiting times. Yet as long-running tensions between Sheikh Hasina and Yunus resurface, it risks becoming a symbol of something else too: an unresolved dispute between Bangladesh’s two most prominent people that has troubling signs for the country’s near-term future.

On a cool, smoggy Sunday, the first day of the working week in Bangladesh, I waited in an auditorium with hundreds of others for Sheikh Hasina to arrive at the concrete and glass Bangabandhu International Conference Center, named in honour of her father. With my Made in Bangladesh invitation letter in hand, I secured a visa at the country’s High Commission in New Delhi, where the polite consular official asked me to focus on “positive” stories. A request for an interview with Sheikh Hasina was declined.

To the extent foreign journalists write about Bangladesh’s prime minister at all, they have concentrated on her harrowing life story — which, alongside the assassination of her father and nearly her entire family, has included several assassination attempts against her — and on her status as a female leader. In October, the Washington Post was granted access to the prime minister in north Virginia, where Sheikh Hasina’s son Sajeeb Wazed lives. The article described her role in containing Muslim extremism and hosting more than 700,000 Rohingyas who were expelled from Myanmar in 2017. Among its other revelations was that she liked cooking chicken biryani for her family.

“Bangladesh is only interested in foreign journalists covering the success story,” Susannah Savage, a British journalist who reported from there from 2017-19, told me. “If you stray too far from that line, the government reacts badly, which brings more criticism and more repression.” Savage said she was interrogated twice by intelligence services about stories during her posting, and was deported at the end of 2019 after being detained at the airport and questioned for several hours.

For Bangladesh, cutting and sewing clothes for the likes of Primark, Walmart and H&M has certainly been profitable. At the conference, a film told attendees how the garment industry had “economically and socially empowered” women in this majority Muslim and male-dominated society.

While garment workers and union leaders filed into their seats to listen to the prime minister’s address, I glanced up at a stern-looking picture of Sheikh Mujib. Nearly every public building features pictures of father or daughter, who bear a strong resemblance to each other, or both. Sometimes portraits of Bangabandhu are perched on pedestals surrounded with decorative bunting in a shrine-like set-up that Bangladeshis call a “Mujib corner”. His daughter’s name increasingly appears on public institutions, including a university north of Dhaka and a Sheikh Hasina Cantonment, used by the army to the capital’s south. The prime minister’s smiling face was also emblazoned on a commemorative banknote last month when Dhaka inaugurated its first metro line, a godsend for the traffic-choked capital.

The invitation had asked me to refrain from carrying a water bottle, cigarettes, chewing gum or “any throwable item” to the prime minister’s speech. A grenade attack on an Awami League campaign event in 2004 left Sheikh Hasina with permanent hearing loss. At about 10am, we stood silently as she entered and took a seat on the stage, a grandmotherly figure wearing thick black glasses, a sari and a veil in red and green.

After Muslim, Hindu, Christian and Buddhist prayers — a symbol of Bangladesh’s relative tolerance in a region riddled with religious violence — the prime minister spoke, expressing “reverence” for her late father, and the “30 lakhs martyrs” or 3 million people who died during Bangladesh’s violent separation from Pakistan, which some here describe as a genocide. Sheikh Mujib’s legacy, including the memory of his assassination, remains arguably the central proposition of the Awami League’s appeal and Sheikh Hasina’s own pitch to voters. The trauma of the event, several people in Dhaka told me, profoundly shaped her.

In her speech, Sheikh Hasina recalled the moment on August 15 1975 when she was told of her father’s death. She and her sister Sheikh Rehana were in West Germany at the time and thus the only two members of the family to survive when gunmen burst into the homes of Sheikh Mujib and others in co-ordinated attacks. (There is an extraordinary museum in Dhaka, to which my government minders took me, built around the family house, featuring Sheikh Mujib’s bullet-riddled bedroom and a holographic display where Sheikh Hasina and Sheikh Rehana remember their father.)

Stranded abroad until 1981, Sheikh Hasina finally returned home to lead the Awami League. In the four decades since, Bangladeshi politics have been dominated by her and another family dynast: Khaleda Zia, widow of late president Ziaur Rahman, and part of the family behind the opposition Bangladesh Nationalist Party. These two bitter adversaries have rotated in and out of power, with Sheikh Hasina spending a combined 19 years in office thus far.

In her speech on the garment industry, Sheikh Hasina described it as Bangladesh’s “most prolific”. It has also made the fortunes of a number of elite Bangladeshis, including MPs and members of government. But the industry’s thin margins and vulnerability to global consumer whims were laid bare during Covid-19 when, at the beginning of the pandemic, high-street retailers cancelled billions of dollars’ worth of orders because they could not sell clothes in their shuttered stores.

Though garment companies pivoted to making masks and other personal protective equipment and the industry has quickly bounced back, some have begun to ask whether Bangladesh is too reliant on cheap labour, be it the people sewing garments in Dhaka or those building skyscrapers in Dubai. (Exports of garments and textiles exceeded a record $45bn in the 12 months to end of June 2022, more than 85 per cent of total export earnings.) But there were no such doubts about the economy voiced in Sheikh Hasina’s speech, which trumpeted her party’s record. “We pledged to change the country,” she said. “We have faced a series of challenges in our life, but we have outlined a sustainable and improved life for future generations.”

Advocates for this view were not hard to find on my government-organised tour of industry figures.

“The garment industry has done tons more for our women than the NGOs,” said the female managing director of Desh Garments, Vidiya Amrit Khan, unprompted, during an interview that was unrelated to the social entrepreneurship of Muhammad Yunus or Grameen.

Yet the other sector that can credibly claim to have uplifted Bangladesh’s economy and people in the past three decades is microfinance. In Banker to the Poor, Yunus’s 1998 account of his founding of Grameen Bank, he makes the case that small loans given to the poorest people can indeed help create a “poverty-free world”. So why has his success in contributing to this aim not made him a local hero?

Yunus was born in Chittagong, part of what was then British-ruled India, in 1940. Like other older Bangladeshis, including Sheikh Hasina, his life was shaped by the country’s war of liberation. At the time, he was teaching economics in Tennessee (after studying in the US on a Fulbright scholarship) and joined other Bangladeshi exiles in pressing the Bengali people’s case in Washington, which sided with Pakistan during the war.

Afterwards Yunus returned to a free but threadbare homeland determined to help, and began heading the economics department at the University of Chittagong. In Banker to the Poor, he writes of having a revelatory moment in 1974, when Sheikh Mujib was in power and the country was in the grip of a famine that killed an estimated 1.5 million people. “In my university courses, I dealt in millions and billions of dollars, but here before my eyes, the problems of life and death were posed in terms of pennies.”

Nobel prize winner and economist Muhammad Yunus
Nobel Prize winner and economist Muhammad Yunus © Andreas Rentz/WireImage

Yunus pivoted to rural development and poverty reduction. Aghast at seeing those who lived at the mercy of loan sharks, in 1976 he began the operation that was to become Grameen after tortuous efforts to persuade the government-run Janata Bank to make unsecured loans, putting up $27 of his own for a pilot project. From the beginning, he made a conscious effort to target women as borrowers, recognising the central role mothers and wives played in families’ livelihoods. This is now a commonplace of development theory, but at the time it was novel and tricky to implement, not least in a conservative Muslim country.

As momentum grew, Grameen expanded into other areas of rural development and branched out into other businesses meant to help solve problems of the poor, including Grameen Telecom, which in 1996 obtained one of Bangladesh’s first telecoms licences along with Telenor and other partners. In 2006, the Nobel committee awarded Yunus its peace prize, lauding Grameen for its efforts “to create social and economic development from below”.

But in 2007, Yunus made what many in Dhaka described to me as the tactical blunder he is still paying for today. During a particularly torrid bout of squabbling between Sheikh Hasina and Khaleda Zia’s parties, he briefly founded his own party, Nagorik Shakti (“Citizens’ Power”), and was touted as the potential head of a caretaker government that could forge a new path for Bangladeshi politics. He soon abandoned the effort yet for some — notably Sheikh Hasina’s Awami League — the idea that a banker with famous backers in the west might emerge as a potential rival for prime minister appears to have stuck.

In 2010, Sheikh Hasina demanded an investigation into Grameen Bank after a Norwegian documentary film alleged that Yunus had misappropriated donors’ money. A Norwegian government investigation found no wrongdoing. The following year, Bangladesh’s central bank ordered Yunus’s sacking as managing director of Grameen Bank on the grounds that he had exceeded a mandatory age limit. Meanwhile some in Awami League circles began saying Sheikh Hasina would have been a more worthy recipient of the Nobel Prize than Yunus for her role in brokering a 1997 peace accord that ended a long-running insurgency of tribal people in the Chittagong Hill Tracts that border India and Myanmar.

Kamal Ahmed, an independent journalist who contributes to the Daily Star and Prothom Alo, Bangladesh’s biggest English- and Bengali-language newspapers, said Sheikh Hasina’s antipathy towards Yunus “appears to be personal”. He added that Yunus’s failed political project, together with the support he enjoys from the US establishment, “made him appear as a constant threat to her power”.

Sheikh Hasina has alleged that after the order to sack Yunus (which Grameen unsuccessfully challenged in court), he “became angrier” and contacted influential friends like Hillary Clinton to lobby the World Bank to remove its backing for the Padma Bridge. Grameen has dismissed this as “fictitious”. But last year, Sheikh Hasina resurrected the story, along with the pressure from Bangladeshi authorities.

Four days after the prime minister’s remarks at the opening of the bridge, the telecom regulator suspended Grameenphone from issuing new SIM cards, claiming the telecoms company was offering below standard services. The telecoms regulator, in remarks quoted by local media, later said that the operator’s service was “not good” the day of the Padma Bridge inauguration. Telenor acknowledged that it needed to improve quality in “isolated pockets” of its network, but said its coverage was the strongest in the country and called for the ban to be lifted, which it finally was this month.

Then came the Anti-Corruption Committee probe. The allegations that Grameen Telecom was “embezzling” money from workers were made after the company reached an out-of-court settlement with workers who filed suit after being denied company contributions to a profit-share fund they were entitled to. (Grameen Telecom denies all allegations of wrongdoing.)

Bangladeshi media have reported on Sheikh Hasina’s allegations against Yunus this year, but did not report that she had anything to do with the ACC probe, or the six-month halt to SIM card sales by Grameenphone. “This is the story that no one is allowed to cover,” a second foreign diplomat told me. “The other is corruption.”

The ACC’s probe of Grameen Telecom has widened its inquiries to 43 entities carrying the Grameen name, including institutions in the US, such as Grameen America, which Grameen points out are fully independent and independently financed. “The government is scaring important partners and investors in Bangladesh away by threatening Muhammad Yunus and hindering him in his work,” said Saskia Bruysten, chief executive and co-founder of Yunus Social Business, which supports projects in east Africa, India and Latin America. “They are ruining the global image of the country this way and stopping work to help the poor.”

Yunus, who was in Colombia visiting social business projects for part of the week I was in Dhaka, declined a request to be interviewed after he returned, telling me through an aide that it would be too risky to speak to an international newspaper. However, he offered me brief written remarks about the controversy. “I feel so sad,” he wrote. “The whole world wants to come to Bangladesh to learn from it. But the Bangladesh government is trying hard to make the world believe that all they have heard is just a big propaganda financed by illicit money, and the product of deception by a crook — in order to keep them away.”

Bangladesh had, he said, missed a great opportunity of being a solution-provider for the world. It was “very sad indeed”.

During my time in Dhaka, I saw little evidence of interest in Yunus’s plight outside elite circles. For most locals, understandably their main preoccupation appeared to be the rising costs of living.

Yet his situation sits at the heart of what government critics describe as Bangladesh’s deteriorating record on political freedoms and human rights. According to campaigners, extrajudicial killings, disappearances and harassment of opposition figures, such as beatings, are common. In 2021, the US Treasury sanctioned seven current and former officers from Bangladesh’s Rapid Action Battalion, an elite military task force, saying there were “widespread allegations of serious human rights abuse” by the force. Bangladeshi NGOs claim the RAB is one of the actors behind hundreds of alleged disappearances and extrajudicial killings since 2018.

On one of my last days in Dhaka, I called on Shahdeen Malik, an advocate specialising in constitutional law. Malik, who has in the past spoken out on extrajudicial killings and taken on some prominent human rights cases, was happy to be quoted — except on the Yunus affair. “I choose every word carefully,” he said with a smile.

He explained that the country’s current economic problems were “probably not a crisis enough to dent our dominant democracy”. But if things got worse, “then maybe the Awami League will be in trouble politically”. In fact, the opposition BNP has been holding rallies of growing size around the country, some of which have been hampered by curiously timed transport strikes. The BNP has also revived the notion of a caretaker government, which some in Bangladesh will associate with Yunus even if he professes he has no ambitions to head one.

Outside pressure is beginning to build too. The US, UK and Japan are among a group of “like-minded” democratic countries that have been meeting informally to discuss politics and governance in Bangladesh, with an eye to “positively engage” (in the words of one diplomat) ahead of the next election. But after Japan’s ambassador made recent public references to the stuffing of ballot boxes, Bangladesh’s foreign minister warned foreign diplomats against “crossing the line”.

When I put this to Nahim Razzaq, an Awami League MP (and the only official to respond to my emails seeking comment), he waved away any concerns. “Of course the government led by Prime Minister Sheikh Hasina is committed to holding free and fair elections. We are obligated to do so under both the constitution and electoral laws of the country.” (I was unable to obtain comment from any government or ruling party official about the prime minister’s attitude towards Yunus, and the telecoms regulator and Anti-Corruption Commission did not respond to my emails.)

 Malik, however, took a darker view. “Our civic space is shrinking,” he asserted. “Any criticism of the government is interpreted as animosity to the government, and by implication silent support for so-called ‘traitors.’”

Though he didn’t comment on the Yunus affair, it occurred to me that the Nobel Prize winner and Grameen were suffering collateral damage in a bigger struggle going on within Bangladesh. “There is an unarticulated conspiracy theory that anybody who criticises the government is taking part in some kind of conspiracy to oust the government,” said Malik. It was, he added, “hardly true”. But that’s never stopped conspiracy theories from spreading before.

John Reed is the FT’s south Asia bureau chief

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