Anisur Rahman Khan :
The government should have to give emphasis on how to reduce inflation and creation of employment generation by increasing investment in the private sector in the next 2022-23 budget.
Besides, social safety net should be expanded as a good number of people are living below the poverty line due to covid-19 pandemic.
A senior economist and former Adviser of the Caretaker government AB Mirza Azizul Islam told The New Nation on Wednesday.
“The unexpected Russian-Ukrainian war began when the world emerged from the last two years of the coronavirus crisis and began to make the necessary preparations for economic recovery. It is becoming very difficult for a country like ours to control food inflation due to covid-19 pandemic crisis across the globe. Besides, there has been a huge imbalance in the overall prices of imports and exports. The trade deficit continues to grow at the hands of the current deficit. The pressure on the value of the domestic currency is beginning to fall in a very normal way, he said.
According to Mirza Azizul Islam, there are several issues that need to be addressed in the upcoming budget and the first is inflation. “Inflation is largely due to the situation in the outside world. It will not be an easy task to reduce it with internal measures. But we have to try to figure out how to reduce inflation. The second issue is that a good number of people living below the poverty line has been increased on account of coronavirus pandemic. Social security needs to be expanded and more people need to be covered and need to be brought under the social safety net,” the economist said.
He also observed that budget allocations will have to be increased in the health and education sectors and guidelines to be ensured that the allocated money to be used properly.
The country’s income inequality has gradually been increased and it is needed to look at how to reduce income inequality, he added.
Besides, it demands to create trade and commerce friendly environment by increasing investment in the private sector.
The system of syndicate that exists in the country needs to be further improved and more progressive, he said adding that just investing in the private sector will not increase without these.
“We need to create more jobs by increasing investment as many people in our country do not get jobs. Our spending and income levels are low and we need to increase our income level. For that, those who are eligible to pay tax, in case of income tax and VAT, but do not pay tax or return, should be brought them under tax net,” Mirza Azizul Islam said.
It would be possible to face the big challenges in the budget if the monetary policy of the country can play its complementary role in the revival of Bangladesh’s economy, he said.
According to the former Adviser, the strategy that the Bangladesh Bank has been pursuing for so long to stem the tide of devaluation of taka, which has a limit too as most of the central banks around the world are devaluing their currencies against the dollar.
If the monetary policy as well as the monetary policy of the country can play its complementary role, then only by facing the big challenges in the budget, the revival of the economy of Bangladesh can take place. The strategy that the central bank has been pursuing for so long to stem the tide of devaluation but there is a limit. Most central banks around the world are devaluing their currencies against the dollar.
In this context, the recent initiative taken by the Central Bank to regularize the foreign exchange needs on a regular basis is to be welcomed, he observed.
Besides, it needs to think about increasing the supply of foreign exchange through controlling imports and arbitrary use of the dollar should be stopped at any cost.
“The time has come to control the import of all kinds of luxury goods too,” he said.
It is needed to increase the domestic production in a view to reduce the import products.
“It is necessary to encourage the expansion of the import industry, which is especially true in this rapidly changing world trade crisis. For this, coordination between NBR and Bangladesh Bank should be increased. If necessary, the margin of luxury products should be further increased, Mirza Azizul Islam said in reply to a query.
The quality of work is not right when the annual development projects work is done hurriedly. Cheques are give without work just to show financial utilization, the senior economist observed.
So, it is needed to complete the ADP work on time and the people can get the desired benefits from these projects.
