Informal commercial activities within commercial areas of Dhaka city a study from spatial and socio-economic perspective

Abstract

In modern urban planning practice a number of issues are emerging which have been overseen for years by the urban planners for its paradoxical nature. One of these issues is 'Informality'. Informality is not a new term for urban planning. Especially in the developing countries where a significant number of people is migrating everyday from rural to urban areas. Most of the migrated population is pushed from the rural areas due to poverty. Thus they desperately look for an income opportunity in the urban areas. The service and employment demand of the poor migrants is always a challenge for the urban planning authorities. A significant share of the migrants gets engaged in informal jobs and commercial activities as the owner of the business or as employee. General practice of the urban planning authority is to consider the informal commercial activities as 'illegal'. But over the years, the informal commercial activities are expanding in the city. In Bangladesh where the 38% of the total economy is said to be informally gained and in urban areas the most prominent feature is the informal development. The present practice of the urban authority of Bangladesh is to demolish or evacuate the settlements and structures. In all the commercial areas of Dhaka City, the demolition of informal commercial activities took place quite frequently. However, reestablishment of the structures within a very short time proves that this action is nothing but a failure. The countries that have almost the same nature in physical and economic development field have been dealing with the issue in a more sensitive way. They virtually 'legalize' this 'extra legal' sector. Since the case of informality is quite acute in Dhaka, there have to be some kind of adaptation measure(s) to deal with this. In such a backdrop, this research has acquired specific information from two major commercial areas of Dhaka City; Motijheel and Tejgaon. The primary objective of this research is to observe the physical characteristics of the informal commercial activities in the study areas. And to analyze the socio-economic factors associated with these informal commercial activities. Samples for the research was collected through systematic random sampling of 600 informal commercial actors. Owners of the informal commercial activity were interviewed through the questionnaire survey. Focus Group Discussion was also conducted in the area to collect information. From this study the overall scenario reveals that a significant number of people employed in the surveyed informal commercial activities, and they are serving a large number of people every day. As they do not have any legal document to operate the business all the transactions are informally done. A well organized network collect this money, who are locally termed as ‘Lineman’. This group use to have a powerful connection with the local government departments and the law enforcement group. They also maintain a good connection with the political party who are in power. This study has reviewed the available literature on this specific issue to understand how the similar problems have been managed worldwide. It is found that, some countries, having similar physical and economic development as Bangladesh, have legalized informal sectors under government provided guidelines. For instance, in China, a former informal squatter in China turned into an ‘Urban Village’ under the government project- ‘Hokusai’. In addition, in India, the informal street vendors are allowed to get registration and ID cards to carry on their business within a guided timeline and location. It is found that the so-called illegal shops do not occupy the active urban space in most cases. they rather choose to use a more underused location beside footpaths and gutters. They serve a huge number of low and middle-income people and employing a good number of young unemployed citizens. But these structures are continuously facing evacuation mostly done with a demolition method which proved to be ineffective as the structures re-established within a very short time. In addition, at the end it is observed that a significant amount of money has been collected by a local group as 'rent' or security money. in some cases like for utility bills it is higher than the legal government rate per unit. In this way, government is losing a big chunk of revenue and though giving good money this informal businessman lacks the ownership sense of their own establishment. This study hence focused on a synthetic solution to adapt this very unique activity in urban space and economy in a more 'legal' way. Based on the available data, and some concerned expert's opinion about the unique characteristics of this Dhaka scenario, a number of policyoriented solutions have been recommended for managing informal commercial activities within the commercial areas of Dhaka city.