Published in The Business Standard on Sunday 5 April 2020
Many ways to misuse the money may open up if incentive loans are disbursed based on banks’ relations with customers. The highest level of transparency should be ensured.
The government must ensure maximum transparency and accountability for proper utilisation of the incentive package offered by the prime minister. Given the context of the country, transparency is very important in spending any sum of money.
But the issue of transparency and accountability of the funds’ distribution channel has not been mentioned in the prime minister’s speech.
The big incentive package is a timely and much needed one but the government should formulate specific guidelines for its proper management. Efficient utilisation of the package is very important, because the government has already lagged behind in revenue collection this fiscal year.
The Centre for Policy Dialogue has already made a projection that the revenue shortfall this financial year will be Tk1 lakh crore. In the present context, the gap will widen further. The country’s economy is already under pressure due to the coronavirus pandemic.
Meanwhile, the Tk5,000-crore aid for the export-oriented industry is too inadequate for them while all sectors need large incentives.
Besides, many ways to misuse the money may open up if incentive loans are disbursed based on banks’ relations with customers. The highest level of transparency should be ensured so that the loans do not go to those hands who are not real entrepreneurs. Commoners have nothing to do here. What is imperative is the government’s honest political will to the supreme degree.
To ensure optimum utilisation of the incentive package for the poor’s social safety, the money should be sent to the bank accounts of respective beneficiaries. In case of relief distribution too, cash, not commodities, should be given to the poor. This will also promote social distancing.
Besides, the government has also not clarified the source of the money for the incentive package. The Bangladesh Bank has been named as the source. But, I do not support printing Takas at the moment because it may devalue the currency. Inflation may go up, which will create pressure on the people, causing their living standards to fall.
So, the government should look to different international development agencies and donors for sourcing the money quickly and on easy terms. The International Monetary Fund (IMF), World Bank, Asian Development Bank, Asian Infrastructure Investment Bank, Islamic Development Bank and other agencies have already announced big assistance packages. The IMF is announcing assistance every day. We will have to take initiatives soon. And unnecessary spending should also be cut.
Dr Fahmida Khatun is currently The Executive Director of Centre for Policy Dialogue