Lack of accountability, graft, weak planning hinder country’s huge potential: Economists

Economist and former advisor to the caretaker government, Hossain Zillur Rahman, thinks the country's significant potential is hindered by what he terms the "iron triangle" of political economy. This encompasses unaccountable economic management, the institutionalisation of inefficiency and corruption, and shortcomings in strategic planning.

Attending a post-budget dialogue organised by the Centre for Policy Dialogue (CPD) at a city hotel today (12 June), the country's noted economists, industrialists, and politicians said the proposed budget is unlikely to bring down inflation and has not met public expectations. Also, establishing good governance can solve a majority of the country's economic issues.

Addressing the dialogue, Hossain Zillur Rahman highlighted the lack of accountability in the banking sector.

He described these two groups – the hardworking entrepreneurial class and diligent economic agents – as the ducks that laid golden eggs for the country's economy but have not received the necessary support and attention.

Addressing this issue is beyond the finance minister's control; it requires a decision from the political leadership, Zillur said.

Additionally, he recommended identifying new growth drivers for the country's economy beyond ready-made garments and remittances to ensure sustainable economic progress for Bangladesh. 

Stating that the nation is in an inefficiency trap, Zillur Rahman said, "Education and health are not integrated with infrastructure development. Furthermore, there are inefficiencies in project selection and cost management."

Rasheda K Chowdhury, former advisor to the caretaker government, described the budget as "an ordinary budget in an extraordinary time," stating that it failed to meet people's expectations.

Dr Fahmida Khatun, executive director of CPD, said the measures to curb inflation and provide relief to the poor and those with fixed incomes are insufficient. In the budget, there is a desperate push for revenue mobilisation amid macroeconomic instability.

Former planning minister MA Mannan said inflation is progressing slowly. He referred to this inflation as a by-product or outcome of growth, suggesting it should be accepted for the sake of economic expansion.

Regarding mega projects taken during his tenure, he said, "I have no objections to mega projects like the Padma Bridge and Metro Rail. However, some projects were approved in my time that I did not fully endorse."

Emphasising the need for scrutinising budget expenditures, the former planning minister said, "We need to evaluate where we are spending the budget, what we are gaining from it, and whether we are seeing any results."

Syed Manzur Elahi, an industrialist and also a former advisor to a caretaker government, said, "Around 90% of the problems will be solved if good governance is ensured in the country." 

He also said there were leakages in many places, such as income and expenditure.

Anisul Islam Mahmud, the deputy leader of the opposition in parliament, said, "In my lifetime, I have witnessed weak economic conditions, but I have never seen it in such a fragile state."

"The International Monetary Fund is now dictating our policies. By adhering to these terms, our economy is currently in jeopardy," he said.

Criticising the opportunity to whiten black money with a 15% flat tax, he said this money earned through "theft, robbery and murder" will not strengthen the economy.

"If I get a chance to whiten money next year by paying 15%, then why would I pay tax? Why do this stupidity?" he said.

"We hear that lists are made of those who own houses in other countries including Canada and Malaysia. Why are they not being caught after being identified?" he said.

Anisul, who is also an industrialist, said, "In 2018, there were Tk58,000 crore in bad loans in the banking sector. This amount has now increased to Tk 86,000 crore. When you consider all factors, it totals Tk4.5 lakh crore. No efforts are being made to recover this money, while those who are paying or attempting to pay are being penalised."