The New Nation - Internet Edition

SOME satisfaction is noted in official circles about the economy coming out of its stagnancy and getting poised to do well in the next fiscal year. While there are some grounds for this optimism from uptrends in some sectors, the same is not shared by external quarters who constantly keep watch on our economy such as the International Monetary Fund (IMF) and the World Bank (WB). These two organisations prepare regularly a joint 'global monitoring report' that sample the economic prospects of countries receiving assistance from the two donor bodies.

The latest version of this report has nothing encouraging to say about the economy. It rather underlined that the economy would have a growth of 5.5 per cent at best, the lowest among the major countries of South Asia, in 2008. The rate of inflation in Bangladesh during this period is projected to be 9.30 per cent in contrast with the lower rates of inflation in India and Pakistan. In sum, both in terms of gross domestic product (GDP) increase that also works as a benchmark for the estimation of per capita income and standard of living and measures of inflation, the position of Bangladesh would be seen to be compared favourably with its neighbours.

Clearly, this warning from the IMF and WB should be responded to in time by the ones responsible for the Bangladesh economy. The preparation of the national budget for the next fiscal year, is nearing completion. The coming budget would be extremely important for the economy. It must have provisions that would truly motivate the private sector on a large scale to take up additional entrepreneurial activities. The budget should also encourage the potential entrepreneurs with tax holidays, tax waiver and other favourable fiscal policies. Government's monetary policies will have to be applied with more imagination and skill with a view to similarly encouraging investments and entrepreneurship.