Experts call for banking reform commission

Experts yesterday demanded that the upcoming budget contain a clear indication that a "banking reform commission" would be immediately formed to address the prevailing vulnerable situation in the banking sector.

"The banking sector is passing a severe crisis moment due to different scams," said Ahsan H Mansur, executive director of Policy Research Institute (PRI), while moderating a dialogue, "National Budget 2018-19: Thoughts at the last moment".

"So a banking commission is required to save the sector as it is an important engine for the economy," he told the event organised by the PRI at Golden Tulip The GrandMark Dhaka in the capital's Banani.

Echoing Mansur, Md Mozibur Rahman, former chairman of Tariff Commission, said, "If the sector continues to go through this situation for long, it would lead to the capsizing of the economy."

Stating that inefficiency is the main obstacle to the budget's implementation, he demanded a special allocation for efficiency improvement, reasoning that training was required to develop highly skilled manpower.

Ghulam Rahman, president of the Consumers Association of Bangladesh (CAB), said local markets increased prices in response to that in the global market but the effect was not immediate when prices went down.

He lauded government efforts in the last couple of years to bring a stop to a tendency to hike prices of essential commodities right after the budget was announced.

Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue, expressed unhappiness over the implementation rate of fast-track projects, saying they were slow just like the annual development programme.

The government allocated an estimated Tk 260,000 crore for 10 fast-track projects and though allocation for those increased in phases, implementation efficiency did not, he said.

He suggested improving institutional capacity to implement the mega projects while forming a public expenditure commission to decide on the type of programmes to undertake.

"The government should review the incentive structure in terms of strategic industrial and trade policy," he said.

Rahman also suggested allocating a particular amount in the budget giving priority to a special economic zone so that it becomes exemplary for others.

Suhel A Chowdhury, a former commerce secretary, said there was a lack of efficient manpower in the government and efficient officials were not in the proper places.

He also blamed inefficiency of the state machinery for the budget not being implemented properly.

Asif Ibrahim, vice chairman, Newage Group of Industries Bangladesh, said the private sector was worried over the increase in bank interest rate and this was a bad sign for the economy and investment.

The one-stop service of Bangladesh Investment Development Authority was also not efficient and this might be a bar to achieving the investment target, added Ibrahim, also a former president of the Dhaka Chamber of Commerce and Industry.

He said the private sector was interested in paying taxes but were put off by the tedious payment procedures.

Muhammad Abdul Mazid, former chairman of the National Board of Revenue (NBR), said there should be coordination between the tariff and customs policies so that businesspeople face no confusion and problems.

Zaidi Sattar, chairman of PRI, stressed the need for export oriented growth.

He said export-GDP ratio was declining and export growth has come down to a single digit.

"We need 12 percent export growth to reach the 8 percent GDP growth target by 2021," he said.

Siddiqur Rahman Chowdhury, a former finance secretary, said there were a number of commitments in the last budget but there was no implementation afterwards. He said budgets should be big and ambitious but backed up with credibility.     

Shamsul Alam, energy adviser of CAB; Faisal Ahmed, chief economist of Bangladesh Bank; Ali Ahmed, chief executive officer of Bangladesh Foreign Trade Institute; Nazneen Ahmed, senior research fellow of Bangladesh Institute of Development Studies, and Sadiq Ahmed, vice chairman of PRI, addressed the programme.