In line with its tradition, the CPD organised a press briefing on 11 June 2010 at the BRAC Auditorium, Dhaka, immediately the day after the National Budget FY2010-11 was announced by the Finance Minister on 10 June 2010. Professor Mustafizur Rahman, Executive Director, CPD briefed the press about CPD’s initial comments on the proposed budget. The briefing was telecast live on Channel i, and was covered extensively by both the print and electronic media.
Professor Rahman remarked that growth target for FY2010-11 has been ambitiously set at 6.7 per cent. Particularly in the context of the uncertainty regarding power, external demand, etc. in the industrial sector, a growth rate between 6.0 and 6.5 may be more realistic. About the size of the budget set at Tk. 132,170 crore, he felt that this was realistic considering the country’s economic requirements. Professor Rahman appreciated that the proposed budget has attempted to mitigate the adverse impacts of global financial crisis. He, however, underscored the need for timely disbursement of the stimulus package to enhance competitiveness of the export-oriented industries.
He appreciated the proposed measures to widen the tax net and noted that realisation of revenue targets should be within the reach of the authorities. He said the income tax floor should have been revised upward as increased inflation was eroding the purchasing power of the low and fixed income groups. With respect to the implementation status of the ADP, Professor Rahman remarked that the authorities should prepare an action plan to complete the large number of carryover projects, prioritising those in the power and infrastructure sectors.
Although the amount allocated for subsidies in the agriculture sector is reasonable, the government should be prepared to increase the allocation considering volatility in international prices, noted Professor Rahman. He also expressed concern regarding the fact that some important reform initiatives such as Bangladesh Better Business Forum (BBBF) and Regulatory Reforms Commission (RRC) are not being continued. Employment generation schemes under social safety net require serious attention from the government with regard to budgetary allocation, project design, implementation and monitoring, he added.
Professor Rahman requested the authorities to finalise the PPP Guideline as it would be a key mechanism to stimulate growth in the future. He appreciated the government’s initiatives such as Bangladesh Infrastructure Finance Fund (BIFF) and infrastructure depreciation allowance to strengthen the PPP framework. He also suggested that for projects which require high and priority attention, the government will need to go forward on its own, if PPP is not forthcoming.
In his concluding remarks Professor Rahman said implementation of the budget will require initiatives in terms of changes in policies, adequate human resource development and strengthening of logistics support.