A day of hartal may not be straightforwardly a day of lost economic activity but the effects of hartal could be even worse for the long-term development of the country than the mere direct loss of economic activity by a hartal.
Some authors suggest that the impact of hartals is even less than the number of days may indicate. Hartals discourage vital foreign direct investments and are obstacles for exporters competing in the global market place. Unsurprisingly, Bangladesh has a very low foreign direct investment ration of only 0.9 per cent of GDP in 2012.
Political instability exacerbated or instigated by hartals furthermore impedes infrastructure development in electrification and transportation, for example. Stability and infrastructure are undoubtedly substantial factors for the economical growth of Bangladesh. Lastly, the local private sector is discouraged to invest in such an uncertain environment. Garments production for example is sensitive to unrest, which obstructs reliable production and timely export of goods, which is essential to sophisticated, modern supply chains of foreign buyers.
