• Tuesday, September 02, 2014

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Climate change takes toll on GDP

Climate change takes toll on GDP

Bangladesh could lose more than 9 percent of its gross domestic product by the end of this century due to the impact of climate change, says the Asian Development Bank. Global warming might cause the country's annual rice production to fall by 23 percent by 2080, according to an ADB report, titled “Assessing the...


Proposal to increase tax revenue

POLICY Research Institute, a private think tank, has proposed that the National Board of Revenue (NBR) bring all forms of personal incomes under the tax regime. Given that every year the government is taking more and more ambitious goals under its belt, experts believe that the only way to generate sufficient revenue is to maximise tax collection from personal incomes. When one takes into account the fact that the top 10 per cent of the population own 35 per...

Growth: Can this budget help it leap?

Growth: Can this budget help it leap?

THE recent announcement of the fiscal budget has triggered a wave of opinions countrywide. Is the curiosity surrounding the budget necessary? Absolutely. We know that for a developing country like Bangladesh, fiscal policies may tend to take precedence over monetary since financial sectors are still developing. Firstly, let us briefly take a look at some of the figures presented this year. The budget targets an acceleration of real GDP growth to 7.3% (from 6.12%) and a fall in inflation to 6% (from 7.5%). Some have critiqued the enormous size of the Tk. 2.5 trillion budget; However, a 15.9% increase in spending may not be considered undue as nominal GDP growth...

Infrastructure Projects

MCCI praises big allocation

A leading chamber yesterday praised the government's big allocation for infrastructure saying the implementation of some mega projects would improve the country's investment climate. The Metropolitan Chamber of Commerce and Industry (MCCI) in its budget reaction lauded the allocation of Tk 8,100 crore made for the Padma Bridge project. It also commended the allocations made for metro rail, transport and human resources development. “The MCCI strongly feels that the increased investment in physical and social infrastructure will help improve the quality...

Mega projects the mainstay

Mega projects the mainstay

With renewed focus on its development ambitions, the government will unveil the budget for fiscal 2014-15 tomorrow, giving precedence over the high-profile projects announced in its last term. In what will be his eighth budget speech, Finance Minister AMA Muhith will place an outlay of around Tk 250,510 crore, 16 percent bigger than the current fiscal year's revised budget. The budget will particularly focus on the resource-intensive big infrastructure projects like Padma bridge, Rooppur nuclear power plant and the Dhaka-Chittagong expressway, all the while keeping the deficit within 5 percent of GDP, a paramount condition of the IMF for its $1 billion credit. The projects, announced in the ruling Awami League's past...

3-year Extended Credit Facility

IMF to provide $141m more

The International Monetary Fund (IMF) has decided to disburse $140.9 million to Bangladesh as part of the three-year Extended Credit Facility (ECF) arrangement.     The decision came after IMF completed the fourth review of Bangladesh's economic programme yesterday. This will bring the total disbursements under the arrangement to about $704.3 million. "Bangladesh has made further progress in strengthening macroeconomic stability under the ECF-supported programme," said a press release of the IMF.   "While economic activity was affected by unrest and uncertainty in...

GDP growth 6.12pc

GDP growth 6.12pc

The gross domestic product (GDP) growth in the current fiscal year is 6.12 percent, the planning minister said today. The rate of per capita income during the same period stood US$1,180, minister AHM Mustafa Kamal told reporters emerging from a meeting of the Executive Committee of the National Economic Council (Ecnec). According to a draft...

World Bank approves $60m for VAT reforms

The World Bank yesterday approved $60 million (about Tk 470 crore) in interest-free credit to help modernise Bangladesh's value added tax (VAT) administration and increase tax revenue. The credit has been offered under a VAT improvement programme that will increase the number of active registered VAT-payers to 85,000 within the next five years compared to around 35,000 now, the WB said in a statement. The project will introduce automation, including online VAT taxpayer services, and improve transparency in the VAT administration...

Phase out quick rental plants

The World Bank has recommended phasing out the quick rental power plants and stopping payment to firms out of production to ease the government's subsidy burden as it has started renewing the contracts with the firms. “To date some contracts have been renewed on a 'no power no payment' basis, while some rental prices have come down, more should be done to reduce the cost of rental power and eventually phase it out,” said the bank in its latest Bangladesh...

Mis(s)trusting GDP

THE king of contemporary economic indicators is, of course, Gross Domestic Product (GDP). … GDP has effectively become a proxy for national success or failure. It has the power to decide elections, overthrow governments, and launch popular movements.” Zachary Karabell wrote these lines in his article, (Mis)leading Indicators : Why Our Economic Numbers Distort Reality, in the March/April 2014 issue of Foreign Affairs. Princess GDP has long been married to a country's development measurement. But nowadays mistrust has grown within...

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