UNB, Dhaka :
Dhaka should not rely ‘too much’ on money borrowed from abroad to meet the costs of Bangladesh’s needs of infrastructure building, says a global development expert.
Naoyuki Yoshino, dean of the Asian Development Bank Institute (ADBI), recommends that Bangladesh should focus more on mobilising domestic resources to increase infrastructure investment with ‘spillover tax revenues’.
“Infrastructure needs in Bangladesh are huge. If you rely too much on overseas money, that will hurt the development,” he told UNB in an interview at the ADB office in Dhaka.
A professor emeritus at Keio University, Japan, Naoyuki Yoshino said public money and funding by international lending agencies are not enough for meet Bangladesh needs in infrastructure building.
“I see traffic jam in Dhaka is getting heavier. That means you have lack of infrastructure and transportation,” he said adding that it is important to explore how to bring the private sector to construct infrastructures.
“And the key is how to increase the rate of return from the investment.”
Yoshino who leads the think-tank ADBI, said many construction companies are interested in constructing railways and highways but they do not care about development of surrounding areas and inclusiveness.
“They’ve to realise that lots of poor people are living in surrounding areas and think of how to provide finance to them and help them start their own small business, shops, restaurants,” he mentioned.
Yoshino encouraged Bangladesh to give attention more on insurance, pension funds, and other savings saying it is very important for Bangladesh to start increasing savings – short-, medium- and long-term to address infrastructural investment needs.
Hometown Investment Trust Funds
He thinks his popular idea – ‘Hometown Investment Trust (HIT)’ funds, considered a stable way to supply risk capital, can be applied in Bangladesh supporting the poor around big infrastructure project sites – roads, railways and highways – through funds.
In Japan, HIT funds were created as a new source of financing to support solar and wind power. The basic objective of HIT funds is to connect local investors with projects in their own locality in which they have personal knowledge and interest.
“If Hometown Fund can be provided, poor people can start their own business along new roads and highways. This is also good for inclusive growth,” said the expert.
By means of HIT funds, many Japanese investors have put small amounts of money toward the construction of wind power and solar power projects.
The HIT funds have spread from Japan to Cambodia, Viet Nam, Peru, and Mongolia and they are also attracting attention from the government of Thailand, and Malaysia’s central bank.
Since infrastructure requires long-term investment, the chief executive officer of the ADBI said insurance and pension funds will be good sources of money in Bangladesh.
“In 1991-1992, I was invited by China. They asked me many things and wanted to Japanese experience of development – what would be the key. I said circulating domestic investments,” he explained how China walked towards development path.
Dhaka should not rely ‘too much’ on money borrowed from abroad to meet the costs of Bangladesh’s needs of infrastructure building, says a global development expert.
Naoyuki Yoshino, dean of the Asian Development Bank Institute (ADBI), recommends that Bangladesh should focus more on mobilising domestic resources to increase infrastructure investment with ‘spillover tax revenues’.
“Infrastructure needs in Bangladesh are huge. If you rely too much on overseas money, that will hurt the development,” he told UNB in an interview at the ADB office in Dhaka.
A professor emeritus at Keio University, Japan, Naoyuki Yoshino said public money and funding by international lending agencies are not enough for meet Bangladesh needs in infrastructure building.
“I see traffic jam in Dhaka is getting heavier. That means you have lack of infrastructure and transportation,” he said adding that it is important to explore how to bring the private sector to construct infrastructures.
“And the key is how to increase the rate of return from the investment.”
Yoshino who leads the think-tank ADBI, said many construction companies are interested in constructing railways and highways but they do not care about development of surrounding areas and inclusiveness.
“They’ve to realise that lots of poor people are living in surrounding areas and think of how to provide finance to them and help them start their own small business, shops, restaurants,” he mentioned.
Yoshino encouraged Bangladesh to give attention more on insurance, pension funds, and other savings saying it is very important for Bangladesh to start increasing savings – short-, medium- and long-term to address infrastructural investment needs.
Hometown Investment Trust Funds
He thinks his popular idea – ‘Hometown Investment Trust (HIT)’ funds, considered a stable way to supply risk capital, can be applied in Bangladesh supporting the poor around big infrastructure project sites – roads, railways and highways – through funds.
In Japan, HIT funds were created as a new source of financing to support solar and wind power. The basic objective of HIT funds is to connect local investors with projects in their own locality in which they have personal knowledge and interest.
“If Hometown Fund can be provided, poor people can start their own business along new roads and highways. This is also good for inclusive growth,” said the expert.
By means of HIT funds, many Japanese investors have put small amounts of money toward the construction of wind power and solar power projects.
The HIT funds have spread from Japan to Cambodia, Viet Nam, Peru, and Mongolia and they are also attracting attention from the government of Thailand, and Malaysia’s central bank.
Since infrastructure requires long-term investment, the chief executive officer of the ADBI said insurance and pension funds will be good sources of money in Bangladesh.
“In 1991-1992, I was invited by China. They asked me many things and wanted to Japanese experience of development – what would be the key. I said circulating domestic investments,” he explained how China walked towards development path.
