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Press Release

Is Bangladesh Heading towards a Divergent Recovery?

During an online discussion panel held on 25th June, Planning Minister M.A. Mannan MP stated that the government is on the right track in formulating the budget. He stated that the main focus of the budget was to strengthen the momentum of development the government has achieved in the past few years. He went on to highlight several achievements of Bangladesh in terms of distributing public utilities such as electricity and water to rural areas. He also stated that a deficit budget is necessary for growth and poverty alleviation. The planning minister said that the budget was business-friendly and “one step forward” for the country, but he did highlight that he has not seen the rate of growth in Bangladesh’s economy that he had expected to see yet.

Former Minister Amir Khasru Mahmud Chowdhury stated on the same web event that people are too focused on the details of the budget and not paying attention to the actual unique economic model in Bangladesh. He stipulated that the whole economy has been geared to serve the interest of certain syndicates who are responsible for vast amounts of money laundering and black money. Since these money laundering schemes are also factored into the GDP measure of the country, he argued that key indicators of development in Bangladesh are being distorted. He emphasised that political decisions have to be made while keeping the interests of the general public and not powerful groups and syndicates.

The webinar where this discussion took place was titled “Is Bangladesh Heading towards a Divergent Recovery?” and was organized by the Centre for Governance Studies. The 2 and a half-hour-long online discussion was moderated by Zillur Rahman, Executive Director, Centre for Governance Studies.

Mr M. A. Mannan MP, Minister, Ministry of Planning, People's Republic of Bangladesh joined as chief guest and Mr Amir Khasru Mahmud Chowdhury, Former Minister, Member of the National Standing Committee, BNP joined as a special guest on the Webinar.

Dr Rashed Al Mahmud Titumir, Professor, Department of Development Studies, University of Dhaka gave the keynote speech where he presented a research paper on the issue.

Dr Fahmida Khatun, Executive Director, Center for Policy Dialogue (CPD); Dr Muhammad Abdul Mazid, Former Chairman, National Board of Revenue (NBR); Dr Muhammed Parvez Imdad, Economist; Mr Shahedul Islam Helal, Former President, Bangladesh Chamber of Industries & Former Director, FBCCI; Abdul Haque, President, BARVIDA & Special Adviser, Japanese Investor's Association, Dhaka; Mr Parvez Karim Abbasi, Assistant Professor, Department of Economics, East West University, were the panellists at the event. Dr Manjur Ahmed Chowdhury, Chairman, Centre for Governance Studies (CGS) gave the concluding speech of the Discussion.

The discussion mostly centred around the budget of FY 21-22. Dr Rashed Al Mahmud Titumir provided the findings from his report that showed how the measures to contain the covid pandemic is simultaneously consolidating wealth for the upper class while worsening the status of the existing poor. He highlighted several issues other than the widening wealth gap, such as how large export-oriented firms reaped most of the benefit of the stimulus package at the expense of Small and Medium enterprises, and how many statistics used in the budget is heavily outdated. He also pointed out that the government's current vaccination scheme will take 4 years to vaccinate the whole population.

Dr Fahmida Khatun noted that the implementation of the budget lacks accountability and transparency, and highlighted the lack of discourse on the budget at the parliament. She argued that non-partisan criticism of the budget is needed to make sure it reflects the needs of the people. The budget has been prepared using a top-down approach, and inputs from the grassroots levels have not been taken into consideration. The stimulus package or other incentives work only when there is an honest business environment, which is lacking in the country. According to her, the budget also doesn’t provide sufficient guidance of recovery for Bangladesh after the pandemic.

Parvez Karim Abbasi reflected on the point of foreign remittance by pointing out that 70% of Bangladesh’s remittance comes from migrant workers from the middle east. He noted that if there is a big reverse migration of these workers due to the pandemic or political unrest, Bangladesh might not be able to accommodate them. 

Shahedul Islam Helal talked about the need to simplify the taxpaying policy and noted how taxation and vat might cause difficulties in the growth of businesses during the pandemic. He suggested that the government should give tax cuts to businesses and people who fall outside the periphery of the stimulus package. He also gave special mention to fledgeling mental health institutions that are in desperate need of support during pandemic times but fall outside the range of the stimulus package.

Abdul Haque emphasised the point brought up before about the faulty data in the budget, saying that if the statistics are false, no amount of planning will result in positive outcomes. He noted that even though the budget is increasing, we are not seeing the effects in municipal public works such as road maintenance.

Dr Mohammed Parvez Imdad emphasised the need to increasing accountability and monitoring in the health and financial sector. He also emphasises the need for public-private partnerships to strengthen the various sectors in the economy. He pointed out that the GDP growth rate target for the last five years has been realistic, however, the pandemic is going to be a big challenge for Bangladesh in reaching a double-digit number. He suggested that Bangladesh might look into creating an upper house of the parliament and Introducing citizens advisory committees in all the ministries to increase democratization in governance. 

Dr Muhammad Abdul Mazid emphasised more on the implementation of the budget instead of arguing the details. He also emphasised the fact that the data does not paint the real picture of the economy. He also noted the slow implementation times of budget policies.

Dr Manjur A. Chowdhury gave the concluding remarks of the discussion by highlighting that the fiscal year of July-June might not be suited for Bangladesh and perhaps the international standard of January-December might be more beneficial towards budget implementation. He also noted that the education sector has received the biggest blow during the pandemic and steps must be taken to ensure education for the people of Bangladesh.

Webinar YouTube link: https://www.youtube.com/watch?v=Nr17j4vDbBY