Investment on infrastructure now critical: analysts
Bangladesh needs to invest more on infrastructure development to continue with its 7 percent economic growth and beyond, said experts and businesspersons yesterday.
“Today, our GDP growth remains trapped primarily due to lack of modern and efficient infrastructure,” said Abul Kasem Khan, president of the Dhaka Chamber of Commerce and Industry, at a roundtable discussion.
The event was organised by the DCCI in partnership with the Bangladesh Investment Development Authority, the World Bank Group and UK Aid at the capital's Pan Pacific Sonargaon hotel.
Some $300-$320 billion is needed to be put into the country's infrastructure sector until 2030, he said.
As per the World Economic Forum's Global Competitiveness Report 2016-2017, the country's infrastructure competitiveness was ranked 114 out of 138 countries.
The discussants said there has been a transformation in the country's economic fundamentals over the last few years as most of the major economic indicators are showing positive trends.
They said it is now time to build on this robust economic fundamental.
The main reason for the lack of modern infrastructure is low investment, which is currently 2.87 percent of GDP, Khan said, adding that solid infrastructure is a pre-condition for attaining 8 percent and beyond GDP growth.
As per DCCI estimation, Bangladesh has trebled its infrastructure spending since fiscal 2011-12. And yet, the amount of spending is low compared to the investment made by peer countries, he said.
For instance, Vietnam invested 10 percent of its GDP in the last 12 years, Taiwan 9.5 percent from 1970-1990, and South Korea almost 8.7 percent from 1960-1990.
For private sector players to come forward and invest in infrastructure projects, there must be attractive returns on investments, said Wendy Jo Werner, country manager for Bangladesh, Bhutan and Nepal of the International Finance Corporation.
Transport networks, road and port access are critical for almost any investment, she said, adding that Bangladesh needs improvement in these areas.
“You need to focus on locations that will create revenue flow,” she added.
Bangladesh's existing infrastructure can support 7 percent economic growth at most, which the country has already achieved, said Kazi M Aminul Islam, executive chairman of BIDA.
“The only way we can go beyond is to have a thrust. And that thrust has to come from infrastructure,” he added.
Bangladesh has proved its capability and strength. Now, the country needs to march forward instead of dwelling on its past achievements, said Hossain Zillur Rahman, executive chairman of the Power and Participation Research Centre, while moderating a plenary session.
Speaking as chief guest, Planning Minister AHM Mustafa Kamal said the government has been working on achieving its targeted growth rate and infrastructure development.
“We will move forward from where we are now,” he added.
Md Abul Kalam Azad, principal coordinator of SDG Affairs of the Prime Minister's Office; Ma Mingqiang, ambassador of China to Bangladesh; and Alamgir Morshed, managing director and head of financial market of Standard Chartered Bank, also spoke, among others.
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