Originally posted in The Financial Express on 17 May 2024
“The government has to borrow to meet operating expenses and development expenses. This financial situation is quite alarming,” he said.
Revenue is often short because not all wealthy individuals pay taxes, and even when regular people do, a sizable portion of it does not make it to the state treasury, said Towfiqul Islam Khan, a senior research fellow at the Centre for Policy Dialogue (CPD), today (17 May).
He was speaking at a seminar, “Budget and Youth Society’s Thoughts”, at the Tofazzal Hossain Manik Mia Auditorium of the National Press Club in Dhaka, organised by the Bangladesh Youth Union.
Towfiqul Islam said, “Despite advancements in different sectors of Bangladesh’s economy over the last decade, revenue collection has not seen notable improvement.
“Consequently, the government’s financial capacity is strained, with planned solutions remaining unimplemented, adding pressure to the economy. This mismatch between economic performance and societal needs is reflected in the escalating cost of living.”
He also said that government data reveal a significant shrinkage in financial capacity, leading to the government taking out loans to repay loans in the last fiscal year, as it has to borrow to cover administrative and development expenses.
This alarming financial situation underscores the immediate need for discipline and good governance in state policymaking, free from the influence of vested interests.
Furthermore, Towfiqul Islam highlighted concerns about Bangladesh’s policymaking process, noting it is dominated by a select few.
He pointed out that aside from tax evasion, the government routinely grants tax exemptions and implements non-taxation policies. Recently, individual companies have also received exemptions, yet there are no visible efforts to tackle the issue.
Regarding the budget, Towfiqul Islam mentioned that allocations made in the past two decades have remained unchanged after parliamentary discussions, with inadequate implementation. This renders these discussions meaningless and unacceptable, indicating the need for an updated allocation process.
At the same seminar, Prof MM Akash, former chairman of the Department of Economics at Dhaka University, advocated a three-pronged approach to ensure the national budget is people-friendly and employment-oriented.
This approach focuses on production, physical infrastructure, and social development, aiming to move away from an implementation-dependent system towards a budget that prioritises the people’s needs.
Additionally, he called for dismantling the bureaucratic syndicate comprising dishonest bureaucrats, politicians, and businessmen, empowering the people instead.
At the seminar, Prof Jobaida Nasrin from the Department of Anthropology at Dhaka University noted a hesitancy among educated youth to pursue careers in agriculture, citing the perceived lack of dignity associated with this field.
She cited the transformation of government jobs from merely secure positions to symbols of power, illicit wealth, and luxuriousness contributing to this reluctance. Jobaida suggested that promoting equal respect in all workplaces could help break the cycle of dependence.
Habib Emon, a member of the Youth Union’s presidium, stressed the crucial connection between job creation and development during his speech.
He criticised the government’s fixation on economic growth, questioning whether its pursuit of growth targets is a cover-up for shortcomings.
Habib stressed that a development plan’s effectiveness hinges on its ability to generate employment, asserting that genuine progress requires ensuring employment opportunities for the nation’s youth.