The New Nation - Internet Edition

UNB, Dhaka

Former Finance Adviser of the immediate past caretaker government Dr Mirza Azizul Islam yesterday assured his successor, new Finance Minister Abul Mal Abdul Muhit, that there is no reason for him to worry about the economy this (calendar) year.

"He (Muhit) has no reason to worry about the economy this fiscal year and even until the end of this (calendar) year," Dr Aziz told reporters, after a meeting with the Finance Minister at his office.

Muhit invited the former Finance Adviser to share views on the current economic situation. They exchanged ideas for over one hour.

Dr Aziz said the economic condition remained sound and it would continue so this year, but advised the new government to be cautious about the possible impact of global recession.

He said the economic growth has been sound and inflation was showing a declining trend while investment, though weakened, increased to some extent relative to GDP.

He, however, advised the minister to remain alert about the impact of recession on the country's exports, Official Development Assistance (ODA) and wage earners remittance.

Replying to a question, Dr Aziz said the new government has no worry about the food security as the caretaker government left a comfortable food stock of 1.3 million (13 lakh) tons. "By the grace of Allah, and due to the efforts by the farmers, we have had a bumper production."

Replying to another question, he said reduction of diesel and kerosene price by Tk 2 per litre was a realistic decision considering the economic situation. "A cut by more than Tk 2 would have made financial management difficult," he said welcoming the decision.

Dr Aziz further explained that a deeper cut would encourage smuggling of fuel oil to the neighbouring countries.

He also suggested looking into whether the consumers were getting the benefit of the price cut.

Finance Minister AMA Muhit defended the decision on the fuel oil price considering the current economic situation. "We tried to give a signal (to the market)," he said.