The government doesn’t have full control over the country’s share market, while the banking sector is now in a fragile position, Finance Minister AHM Mustafa Kamal said in parliament yesterday.
In reply to a supplementary question from ruling Awami League MP Ahsanul Huq Tito, Kamal said, “The share market is not under control, but I won’t say that it is not under complete control.”
In his speech, the finance minister said the reflection of the stronger economy was seen in the capital market first.
The country’s economy is very vibrant and strong, he said, adding the World Bank and IMF had lauded the country’s economic progress.
They also asked other countries to follow Bangladesh.
“But in the share market, we have identified the problems and we will solve those one after another,” he said, adding, our advancement will be stopped if we cannot bring the share market under control.
He said he had already held meetings with the stakeholders of the market and would hold some more in the coming days.
“We will try to run the market like it runs in other countries of the world. The loopholes of the market will surely be removed,” he said.
Kamal also assured that the government would do whatever was needed to run the capital market strongly.
The minister said as the capital market and economy were interwoven and integrated, there would be incentives for the market in the next budget.
In the whole world, the capital market and the economy was related in this way.
“But how much will be the incentives, I cannot tell that right now,” he added.
Responding to another query from treasury bench MP M IsrafilAlam, Kamal said the country’s banking sector was now in delicate situation.
“Our banking sector is now in delicate position. There is no problem in accepting that,” he said.
He also mentioned that these kinds of incidents occurred in every country as it was not possible for a developing country to run all the sectors in a balanced way all the time.
“In that situation, I will not say that our banking sector is doing badly,” he said.
He said that the rate of interest in the country was comparatively high-er. “In the whole world no country has 14-15 percent interest rate,” he said.
“We are doing one thing; soon we will formulate a rate integrated with the whole world. If we can implement that rate of interest it will be the turning point for the history of the economic sector of Bangladesh.”
The finance minister mentioned that if the interest rate could be low-ered to a single digit, there would be incidents of writing off loans re-peatedly, which will cause the increase of non-performing loans.
“The weak areas will be weaker; we don’t want that repetition. We have started our work, now it is the time to implement it. We will reduce the interest rate, we will keep the rate in single digit which was the pledge of the prime minister,’ he added.
In reply to a supplementary question, Kamal said there were policies across the world to forgive loan defaulters. He, however, said all loan defaulters could not be forgiven.
“The country’s economy will not run if we send all businessmen to jail. However, we cannot grant forgiveness to all. We must take actions against those who become loan defaulters willingly. The government will take a hard stance against them.