IT is nothing but just an effort of the government to give an artificial push to the economy by borrowing from the external private sector (Financial Institutions) which eventually will not yield any ultimate gains, rather it will only intensify the debt burden (impacts and incidents) on the people. The economy by this time has failed to meet the expected budgetary expectation, a news report of an English daily said Wednesday. For that the government plans to borrow from overseas private financial sector and multilateral lending agencies with high interest, the report added. This happened for the first time in the country to meet up the fiscal targets amid the lax revenue-earning situation.The Finance Ministry is now working on with this plan to prepare a guideline for borrowing costly funds from overseas sources, which will remain outside the purview of ‘government to government’ non-concessional loans. The Ministry had framed a debt strategy to borrow as much as 60 percent of its total need from bilateral and multilateral lenders including costly commercial loans. The country is already burdened with huge loan deficits along with the gross external per capita debt at US$162.2 or BDT 12,700. The country had loans of $26.13 billion or over BDT 2.03 trillion as on June 30 of FY 2012-13. Bangladesh paid $274.1 million as interests against the loans, which is 7.2 percent of the export income and 0.21 percent of the GDP.Reports have it that the Finance Ministry asked Bangladesh Bank, Economic Relations Division and the Planning Ministry to finalise the guidelines earlier. A committee was formed last week comprising officials from these three agencies, which is expected to draft the guidelines by next week. We are apprehensive of corruption at the project level of such loan dealings and of huge kickbacks outside the country to avail the loan, which will consequently increase capital flight from the country. Govt upheld the logic that while the private sector can borrow from overseas sources then why not the government? This actually proves the government’s bankruptcy due to pilferage of public money as the development partners have already turned around from investing more in public projects due to government’s illegitimacy and ineptness. Most projects are formulated on the basis of felt needs, but mostly just for name building to allure the domestic vote banks. Moreover to buy loyalty, government would need more liquid funds once the proposed pay commission award for public servants is implemented.We say that no huge borrowing with high interest rates along with disgracing tight conditionalities can heighten the economy much. The people are the eventual victims of such loans. Besides, it may make things difficult for the successor government to repay since it’s a state deal. Our citizens should not be victims to the whims of the govt functionaries. We ask the government to shun the path of temporary gains, if any exists at all.
