Vaccination key to fast business revival
Vaccination of 12 crore more people within the next one year is a must to restore confidence and revive Bangladesh's businesses and economy, said analysts yesterday.
Major trading partners have already vaccinated a majority of their people and normalcy have started to be restored in their businesses and economy whereas Bangladesh is still lagging behind in vaccinating its people, he said.
"Bangladesh needs 24 crore doses of vaccines and I hope the government will get businesses and people vaccinated by the end of June next year. It is possible," said Ahsan H Mansur, executive director of the Policy Research Institute (PRI).
"We do not have any benefit only discussing the money and economic growth. We do not have the vaccine," he said.
Addressing a virtual post budget discussion, the former International Monetary Fund (IMF) economist said there was really no allocation for the new poor in the budget.
The allocation for social safety net programmes, which includes freedom fighters and pension schemes, has been increased, not for the new poor and cottage, micro, small and medium enterprises (CMSMEs), he said.
Mansur said the total budget outlay of over Tk 6 lakh crore was not too big of an amount considering the current size of the economy.
In 1972 the then finance minister Tajuddin Ahmed's budget amounted to Tk 700 crore, which was 15 per cent of the GDP, whereas the current amount is 17.5 per cent of the GDP, he said.
The discussion on "Budget 2021-22: Bangladesh Towards a Resilient Future, Protecting Lives and Livelihoods" was jointly organised by the Metropolitan Chamber of Commerce and Industry (MCCI) and PRI and attended by business chamber leaders, government high-ups, researchers and lawmakers, including a minister.
Planning Minister MA Mannan echoed Mansur's views on vaccination. He acknowledged that Bangladesh required vaccines on a priority basis.
"However, I am cynical about the behaviour of some rich countries. They are sending vaccines to their favourite countries… (on) flights but some low income countries are not getting the vaccine," said Mannan.
Without mentioning any particular country, he said the government was looking east for cooperation over securing vaccines as it believed that direction was a source of hope.
"Vaccine does not help survival of democracy, vaccines save people," said the minister.
On the issue of new poor, Mannan echoed the views of his colleague, Finance Minister AHM Mustafa Kamal. Kamal last week said the new poor was a new, temporary phenomenon.
Mannan said the incumbent government has also created a lot of new rich and so the old rich should come up to help the new poor.
The budget has been proposed to ensure justice, fairness and equity, Mannan said citing an example of the prime minister on Sunday having allocated 53,000 houses for homeless people.
In a keynote paper, PRI Research Director MA Razzaque said attaining the government target of a zero poverty rate would have been possible by 2030 had not the Covid-19 pandemic come about.
However, the target can be reached a bit late in 2038 even if the current economic growth continues, he said.
Razzaque said had not the pandemic come about, Bangladesh could have added some $31 billion to its GDP in the past one year.
However, despite a lot of challenges and difficulties, Bangladesh and China attained positive economic growth, he said.
Moderating and co-chairing the discussion, MCCI President Nihad Kabir termed the proposed budget more effective, pro-people and business friendly.
The budget's implementation and quality spending of the allocation are two major challenges for the government, she said.
Kabir also said vaccination, employment generation and slowdown of economic activities were also challenges for the government. "Revenue mobilisation is going to be tricky," she added.
Appreciating the reduction of corporate tax by the government, she also sought separating the tax policy and collection wings of the National Board of Revenue (NBR).
Praising the country's macroeconomic stability, PRI Chairman Zaidi Sattar said if the government could complete implementing five to six mega projects within the next few years, the GDP could grow by an additional 1 to 2 per cent.
He said the government's 6.2 per cent budget deficit was proposed because of the fallouts of pandemic.
"The Bangladesh economy is a development miracle," Sattar also said.
Adeeb H Khan, chairman of the MCCI's Tariff and Taxation Sub-Committee, urged the government for reconsidering increasing tax on mobile financial service (MFS) providers, reasoning that it was a rising sector in the country.
He said income tax should be applied only on income, not revenue. Advanced income tax and withholding tax need to be reduced, he said, hoping for some structural changes in the VAT system.
Abul Hassan Mahmood Ali, chairman of the Parliamentary Standing Committee of the Ministry of Finance, said the sole function of some people was to always defame the government.
"I became stunned when (name withheld as claim could not be verified) said the budget was a drama in parliament…I did not expect such an irresponsible comment such a respected person," he said.
Commerce Secretary Tapan Kanti Ghosh, Rupali Chowdhury, president of the Foreign Investors' Chamber of Commerce and Industry, Waseqa Ayesha Khan, chairman of the Parliamentary Standing Committee on the Ministry of Power, Energy and Mineral Resources, and MCCI Vice-President Anis A Khan also spoke.
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