The New Nation - Internet Edition

Bad news for satellite channel viewers

UNB, Dhaka

The viewing of satellite TV channels will be costlier as the government proposes to enhance the existing rate of supplementary duty from 15 percent to 35 percent for the satellite channel distributors.

Finance Adviser Dr Mirza Azizul Islam in his budget speech said the local satellite TV channels are subject to payment of 15 percent VAT on the commercials telecast on their channels whereas the foreign TV channels pay no VAT on commercials that are telecast in Bangladesh.

"Although these commercials are not directly targeted towards our local consumers, but they indirectly help creating import demands for commodities shown on these commercials."

Pre-shipment Inspection to continue

UNB, Dhaka

The government is in favour of continuing with the Pre-shipment Inspection (PSI) companies, although it admitted that there are widespread allegations of various irregularities.

Finance Adviser Dr Mirza Azizul Islam in his budget speech proposed to continue with this arrangement through fresh appointments under a revised policy guideline for a limited period.

"This system shall be withdrawn as soon as the automation process and appointment of officers are completed," Dr Aziz said.

He said Customs Department has currently inadequacy both in terms of infrastructural and human resources capacity, including acute shortage of officers and staff.

"Against this backdrop, lifting of PSI system may cause complications in the customs assessment process."

Currently, the mandatory pre-shipment inspection system is operational on most of the importable items.

This was introduced with a view to ensuring faster clearance of imported cargo and preventing revenue pilferage. The tenure of the contract of service with the existing PSI Agencies will come to an end on August this year.

"There are widespread allegations of various malpractices of the PSI agencies and the government is fully aware of them. The activities of the PSI agencies are being monitored very closely and stern actions are being taken, including termination of contract, whenever any case of misconduct is detected. These measures shall continue," he said.

He also said the PSI system is not a permanent arrangement. In view of the existing reality, this system was introduced as a temporary measure to facilitate trade.

Tk 100 crore for IT fund

UNB, Dhaka

The new budget proposed to form an IT Equity and Entrepreneurship Fund with an allocation of Tk 100 crore to enhance investment in the ICT sector, one of the thrust sectors of the country.

"To ensure easier access, relevant agencies, including Bangladesh Computer Council, will be involved in the process of channeling this fund," Finance Adviser Dr Mirza Azizul Islam said in his budget speech.

He said the government was formulating national e-governance strategy supported by a national ICT roadmap. The first phase of infrastructural work of a 231 acre hi-tech park at Kaliakoir near Dhaka would be completed by the yearend.

"Efforts are underway to attract private and foreign investors to make investment in this IT-park," he said.

Aziz said the government has also taken a number of steps in the area of information and broadcasting as a set of guidelines has been prepared to introduce community radio broadcasting system.

He added that the pay and allowances of the employees working in the newspaper industry have been increased while the rates for publication of government advertisements in the newspapers have been enhanced.

About telephone facilities, he said the tele-density in Bangladesh has increased from 18 per 100 population in the previous year to 28 in the current year with the expansion of telephone facilities, including mobile phone.

Digital telephone exchanges have been set up in 389 upazilas apart from 17 growth centres.

Besides, work is underway to bring the rest of the upazilas under the digital exchange system.

The Finance Adviser also said Bangladesh has joined the information superhighway by connecting itself with the international submarine cable system. "Ninety-two Internet service providers have now been connected with this system."

Female, aged persons to get extra facility

UNB, Dhaka

The caretaker government refused to entertain the plea for a change in the budget raising the income-tax slab for the next fiscal year (2008-09) to match with the inflationary pressures.

"The existing limit for tax-free income, tax rates, income slabs for individuals shall remain unchanged for the upcoming fiscal year," Finance Adviser Dr Mirza Azizul Islam said in his budget speech yesterday.

But, for female taxpayers and senior taxpayers of ages exceeding 70, he proposed to raise the limit for tax-free income to Tk 165,000. For others, the ceiling continues to be Tk 150,000.

"It may be mentioned that the limit for tax-free income was considerably raised in the last fiscal year," the Finance Adviser said to support his position on not making any change in the income-tax ceiling and rate.

He, however, reduced the tax rate for listed and non-listed companies. He proposed to revise the tax rate for companies listed for public trading from 30 percent to 27.5 percent, for companies not listed for public trading to 37.5 percent from 40 percent.

"The 45 percent rate for banks, insurance, financial institutions and mobile-phone operators will, however, remain unchanged."

For corporate taxpayers, Dr Aziz proposed to impose income tax on dividend income in accordance with the applicable scheduled rates for companies instead of the existing 15 percent.

Currently, according to Section 16CC of the Income Tax Ordinance, all companies, irrespective of profit or loss, have to pay a minimum tax on the basis of their turnover, which is clearly in breach of the fundamental principles of Income Tax.

"I propose to rescind this Section."

SME fund raised to Tk 200 crore

UNB, Dhaka

The budget has proposed to raise SME Endowment Fund to Tk 200 crore in the next fiscal year from existing Tk 100 crore in an effort to promote small and medium enterprises in the country.

In addition, funding for the SME Refinancing Scheme of Bangladesh Bank has also been proposed to enhance from Tk 300 crore to Tk 500 crore.

Proposing the enhanced allocation, Finance Adviser Dr Mirza Azizul Islam in his budget speech yesterday said an SME Foundation has been established to implement the SME policies and strategies of the Government and to facilitate required reforms in this sector.

Governed by a Board of Directors based on the principle of public-private partnership, the foundation comprises experts from the public and private sectors, he added.

The Foundation was providing recommendations to the government to assist it in identifying problems in the SME sector and in determining strategies for their resolution.

To promote women entrepreneurship, Dr Aziz said the SME Foundation has constituted a forum titled National Women Entrepreneurs Forum. The Foundation has been asked to commence its credit operation to provide credit to the SME entrepreneurs at a low rate of interest.

Besides, a programme has been taken up to create a database with the data inputs derived from a nationwide survey. Last year, the Foundation provided assistance to enhance efficiency of about 5,000 entrepreneurs.

"SME helpline centres will be established in each district across the country," the Adviser said.

Tk 4,340 crore allocated for power and energy

UNB, Dhaka

The government has allocated Tk 4,340 crore for the power and energy sector in the budget for FY 2008-09, recognising that it would be difficult for it alone to mobilise the huge investment needed to meet the power deficit.

"This allocation is 4.3 percent of the total budget and 21 percent higher than the revised allocation of the current fiscal year," the Finance Adviser said in his televised budget speech.

He said the daily demand for electricity is now 4,500 MW on average against the net generation of 3,600 MW.

The huge investment that will be required to generate power to meet the deficit of 900 MW will be difficult to be mobilised by the government alone.

"We have, therefore, taken short-term and long-term steps for involving the private sector for adequate generation of power. We're currently working to reach the target of meeting the minimum requirement of power by 2008-09," he said.

According to the existing Master Plan, it is anticipated that by 2020 the country would be able to reach the level of generation of power in line with the growing demand.

Mirza Aziz said although 43 percent of the total population currently are enjoying electricity facility, the per capita electricity consumption is lower than many developing countries.

In 2007, Bangladesh's per capita electricity consumption stood at 140 KWH while it was 325 KWH in Sri Lanka, 408 KWH in Pakistan and 665 KWH in India.

He said in the current fiscal year a total of 124 MW from public and private sectors has been added to the national power grid. Another 210 MW will be added by June 2008.

By December 2008, a total of 320 MW power will be generated on a rental basis in the private sector and another 166 MW will be generated by 10 small power producers.

"To meet the emergency, we have increased generation of 318 MW of power by renovating the old power plants. In spite of all these efforts, inadequate gas supply has disrupted the normal power generation," the Finance Adviser said.

He said the International Atomic Energy Agency (IAEA) has agreed to support the proposed Rooppur Nuclear Power Generation Plant.

IAEA will shortly field a mission to Bangladesh. Efforts are underway to generate electricity from coal and renewable solar energy.

He said the government has supplemented BPDB to the tune of Tk. 600 crore to foot the bills of Independent Power Producers (IPP).

Another amount of Tk. 399 crore has been provided from the government budget as equity to finance pension and gratuity payments of the employees absorbed in the newly created power and transmission companies.

Tk 21,112 crore allocated for Human resource Dev

UNB, Dhaka

Taka 21,112 crore were allocated in the proposed national budget for 2008-09 for human resource development, which is 21.1 percent of the total budget.

Finance Advisor Dr AB Mirza Azizul Islam in his budget speech yesterday said human resource development is one of the prime conditions for achieving a sustained economic and social development.

He said education and health are the major inputs for human resource development.

The Advisor said the 6-year Second Primary Education Development Programme (PEDP-11) with an outlay of Tk. 1,800 crore is being implemented to widen primary education and to enhance its quality.

Around 55 lakh students are receiving stipends annually. All these steps have helped achieving 50:50 ratio of male and female students at government primary schools.

In FY 2008-09, as many as 33,00,000 newly literate persons will be imparted job-oriented training to help retain their level of literacy and to raise their living standards.

The ongoing programme will continue to bring down the current student-teacher ratio of 55:1 to 46:1 and to increase the rate of enrollment to 90 percent by 2009.

He said ninety-eight percent of the secondary and higher secondary educational institutions are privately managed. In order to raise the quality of these institutions, the payment of MPO subvention has been linked to their performance.

Aziz said the Non-government Teachers' Registration and Certification Authority (NTRCA) is at work for ensuring the recruitment of quality teachers.

He said the disparity that exists in the quality of education between the urban and rural areas is widening. In order to reduce this gap, he said steps have been taken to establish model high schools in those upazilas where there are no government schools. A selection process is underway to select 63 schools to convert them into model high schools.

The Advisor said significant progress has been made in female education, following the increased enrollment of female students at secondary and higher secondary level by 52 percent.

Against this backdrop, he said a stipend programme for the poor male students will also be introduced in next fiscal year in 121 Upazilas to increase the rate of enrollment of male students.

The Advisor said guidelines for female stipend programme will be revised to lay greater emphasis on quality education. Only around 2-3 percent of the total students at the secondary and higher secondary level receive technical and vocational education.

Consistent with national goals, he said vocational education at various levels is being introduced to equip the youth force with technical and vocational skills.

He said to retain the quality of 34 education in both the public and private sector, the government has recently approved the Private Universities Ordinance, 2008.

Under this Ordinance, an Accreditation Council will be constituted to compare the higher education system with the international standards to determine the standing of our public and private universities.

In the current fiscal year, he said Tk. 10 crore were allocated to carry out research in the areas of physical, mathematical and biological sciences. In the next fiscal year, the Advisor proposed to allocate Tk. 15 crore to this end.

On health sector, Aziz said adequate and planned investment in the health sector is fundamental to human resource development.

To this end, he said the government is implementing a seven-year (2003-2010) Health, Nutrition and Population Sector Programme (HNPSP) at an estimated outlay of Tk. 32,450 crore.

As a step towards updating the existing polices and laws, he said the government is revising National Health Policy, rules relating to hospital waste management, private medicare laws and the Essential Drugs Lists.

Aziz noted the Government is laying emphasis on increased involvement of private initiative in the health sector. Implementation of a programme is underway to outsource the management of 342 community clinics and 130 Union Health and Family Welfare Centres and Hospitals to the private sector.