Bangladesh not in financial crisis, but faces political, economic challenges: Finance adviser

Bangladesh is not in any financial crisis, but it is grappling with political and economic challenges influenced by both internal and external factors, Finance Adviser Salehuddin Ahmed said today (16 November).

"Due to lack of governance and accountability, most of the institutions, especially state-owned companies, have been on the brink of collapse," the adviser said while addressing a policy dialogue on "Financial and Economic Reforms in Bangladesh 2024" at BRAC University in Dhaka.

Brac Business School of the Brac University organised the seminar on its campus in Merul Badda.

"We're trying to bring about good governance which is a big challenge. But I'm not too disappointed with the situation as Bangladeshis are very efficient and creative," he said.

Recently, the finance secretary and other officials met to discuss how to correct data that had been manipulated, particularly regarding inflation, deficits, and arrears, the adviser also mentioned.

The adviser further said the interim government is introducing changes to its development strategy, focusing on inclusive progress rather than just growth.

"Measures will be taken to ensure that the development benefits reach everyone and are not limited to a privileged group. Human resource development, particularly in education and health, will be prioritised," he said.

He noted that mistakes were made in past development strategies, as the focus remained on growth without ensuring that benefits trickled down to all levels. "Only a small group reaped the majority of the benefits."

Salehuddin said the government has been working to bring down inflation and create market stability by taking different measures, like waving import duties.

"But there are so many factors – from production to supply chain. The traders have to pay extortion money which pushes up the prices."

To stop this, a political solution is needed, he added.

Criticising the previous Awami League regime's GDP calculations through wrong data and misinformation, the finance adviser said there was no accountability on part of the relevant institutions.

About laundered money, he said officials will be sent abroad to recover laundered money, and discussions are ongoing with countries like the USA. "However, retrieving these funds will take time, though measures are being put in place to prevent further money laundering in the future."

He observed that there were many projects for which no feasibility study was conducted. "Now it's found that the Indian Adani Group did not pay their taxes in implementing the project."

The government is working to reform such issues with the support of the people, he said, adding that they might not be able to complete all the reforms, but leave a footprint so that the next government can follow and implement.

Additionally, Salehuddin announced upcoming reforms within the National Board of Revenue (NBR), which will separate tax policy from tax administration.