News Published: Sunday, Jun 01, 2014
Experts suggest thrust on non-RMG exports
Sun, Jun 01 2014, 12:00 am
Top economists at a pre-budget discussion in city on Saturday said the revenue target to be proposed in the next budget should be realistic and achievable as revenue collection performance in the outgoing fiscal year has not been satisfactory. They gave the suggestion at the pre-budget discussion organised jointly by the Policy Research Institute of Bangladesh (PRI) and the private television channel Ekattor TV. The discussion, moderated by its executive director Dr. Ahsan H Mansur, was held at the conference room of the PRI in the city. Speaking at the discussion, Dr. Zaid Bakht, director (research) at the Bangladesh Institute of Development Studies (BIDS), said the revenue target should be realistic as the National Board of Revenue has already slashed its target for the current fiscal year by Tk 110 billion from the original one of Tk 1,360 billion. He said the private sector investment has been inadequate in the outgoing fiscal. "The revenue target should not be ambitious one", he added. Eryerts said projects under the Annual Development Programme (ADP) should be chosen on the basis of priority, not under political consideration. They said subsidy allocation should be for the population who need it most and it should also be rationalised in many sectors. Terming the existing trade policy as anti-export in the case of non-readymade garments, a number of speakers said the trade policy I needs to be reformed structurally. They said Bangladesh is missing the opportunity of trading in intermediate goods due to lack of protection; and the required policy supports. Dr. AB Mirza Azizul Islarn, former adviser to caretaker government, said Bangladesh is missing an opportunity in trade of intermediate goods. Listing the trade in intermediate goods as a rap idly growing area in the globe, Dr. Islam said there is a need for protection and other policy supports for it. He said trade is expanding rapidly in East Asia and other parts of the world. Echoing the views of Dr. Islam, Dr. Khurshid Alam, director (operations) at the PRI, said local investment as well as foreign direct investment (FDI) is I required to boost trade in intermediate goods in the country."Some of the renowned companies of the world could assemble some of their parts in Bangladesh and thus help the country boost its trade," Dr. Alam said. He said many automobile manufacturing companies could manufacture their parts here. "The sector could attract FDI in the country," he noted. He said undertaking ADP projects in political consideration should be avoided as it is just wastage of public money. Speaking at the programme, former Bangladesh Bank Governor Dr Salehuddin Ahmed said the ADP should include big projects instead of a large number of small projects. Listing some sectors and areas that should get priority in the next budget, Dr Salehuddin said focus should be on communication, power and gas sector and health in the next ADP. He said there is a need for protection of some innovative local sectors. Former Finance Secretary Siddiqur Rahman said big projects in the ADP have remained unimplemented like the Dhaka-Chittagong Highway. "We're considering the Dhaka-Chittagong 4Jane as economic lifetime of the country, but it is yet to be executed while the rate of implementation of the small-sized projects is higher," Mr. Rahman noted."In my view, the priority projects should be implemented in the next fiscal year," Mr. Rahman added. Former Chairman of the National Board of Revenue (NBR) Mohammed Abdul Majid said macroeconomic stability is very much important to mobilise the e4ected level of revenue. He said political stability is also equally important to help keep macroeconomic stability."We'll miss all our revenue targets if there is political disturbance. This is also true in the cases of value added tax and income tax collection," the former NBR chief said. Dr. Zardi Sattar, Chairman of the PRI, said the existing trade policy should be re-structured to promote sectors other than the RMG. He said there are some trade taxes including some para-tariffs which need to be reduced. Dr. Sattar said Bangladesh is now highly dependent on RMG exports. Policy supports for non-RMG sectors should be given to promote exports of other products. Dr. Zahid Hussain, lead economist at the Dhaka office of the World Bank said the next budget should focus on how to revitalise the rural 6conomy.He said the potato growers did not get proper prices that led to frustration among farmers. He said economic diplomacy should be strengthened to boost remittance inflow in the country. Dr. Hussain said the country is now facing an image crisis abroad following Rana Plaza collapse, one of the worst industrial disasters in the world. Former special assistant to chief adviser of caretaker government M Tamim said subsidy in the power sector should be re-evaluated."I think the subsidy in the power sector will not drop overnighit as we're providing the same to oil-based power generation," Mr Tamim said. He, however, said subsidy in the power sector will drop if there are coal-based big power plants."We're hearing that coal-based power plants will be installed and it will help reduce subsidy in the power sector," Mr. Tamim said. Former Commerce Secretary Sohel Ahmed Chowdhury said Bangladesh has not been doing anything for trade promotion and trade infrastructure for long Mr Chowdhury said the country's export promoting office. Export Promotion Bureau (EPB) is now highly involved with the RMG products. "With a separate apparel board coming into being the EPB could concentrate on non-RMG sectors. He said the EPB should be strengthened in order to diversify products and destinations. The former Commerce Secretary said there is a need for budget allocation for trade infrastructure. Vice President of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCD Helal Uddin said investment is not picking up due to the high rate of interest in the banking system and lack of required infrastructure. He said there is a need for good governance and corruption-free administration to boost investment. Selina Ahmed, founder President of the Bangladesh Women Chamber of Commerce and Industry, said a business-friendly environment will help boost revenue earning of the government."If we cannot do business in the country, we cannot pay taxes," she added. She however, said there is a need for creating a level-playing field for all business organisations. Dr. Ahsan H Mansur said: "We expect concrete discussion on budget in the coming session of the parliament.