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Former finance minister A M A Muhith has said Bangladesh’s economic growth might be impacted by the slowing down of neighbouring India’s economy.
“To my mind, the ongoing sluggish trend of Indian economy may impact Bangladesh’s Gross Domestic Product (GDP) projection,” said Mr. Muhith, who had served more than a decade as the country’s finance minister.
“We should be careful about the slowdown of Indian economy. The slow GDP growth of India has impact on the regional economies.”
He opined that Bangladesh should be worried about the falling trend of Indian economy [as it is the largest trade partner of Bangladesh].
The former finance minister also noted that there is need for discussion with India [regarding the economic condition].
“We need to discuss with the Indian authorities concerned about what has been happening in their economy.”
He, however, said Bangladesh’s economy may remain buoyant in the next 2-3 years.
Mr. Muhith said these while speaking as the chief guest at the inaugural session of the two-day research almanac, organised by the Bangladesh Institute of Development Studies (BIDS) in the city on Sunday.
The Indian GDP has been continuing its downward spiral for the seventh consecutive quarter, falling to 4.5 per cent in the second quarter (July-September) of the fiscal year (FY) 2019-20.
The GDP growth of last quarter, ending in September, was the slowest in more than six years.
Indian economy previously achieved a 4.3 per cent GDP growth in the final quarter (January-March) of FY 2012-13.
Mr. Muhith also said poverty still remains a pain for Bangladesh’s economy.
“We still have around 30 million people living below the poverty line. It is hardly possible to get such a large population in many countries.”
He noted that the BIDS was first established in Karachi, and later was shifted to Dhaka. It is a good institution that Bangladesh inherited from Pakistan.
“We need more such institutions in the country, as their works are very much relevant to policy formulation.”
“We have some research organisations in the private sector, and they are rubbish,” he added.
Another former finance minister M. Syeduzzaman also joined the inaugural function as special guest.
Dr. Shamsul Alam, senior secretary and member of the General Economics Division (GED) of the Bangladesh Planning Commission, and Md. Nurul Alam, secretary of the Planning Division under the Ministry of Planning (MoP), also attended the programme as special guests.
The BIDS director general Dr K A S Murshid moderated the inaugural session.
Syeduzzaman said Bangladesh’s economy now has major challenges, like – income inequality in the society, financial sector, job creation, and increased female participation in the labour force.
Dr. Alam, in his speech, stressed the need for accuracy of data.
“If we don’t get accurate and quality data, the policies prepared by using such (inaccurate) data will not work.”
“I’m confused about the data, as it does not match with the country’s rice market and recently with onion market,” said the GED member.
He further said: “Given the rice production data, we should have a surplus of 5.0-6.0 million tonnes of rice. But we import around 1.0 million tonnes of rice almost every year.” “I don’t understand why it happens so, if the official data is accurate.”
Similarly, local onion production is around 2.2 million tonnes per year, which is very close to the country’s annual demand of 2.3-2.4 million tonnes.
“If the production is ample, could we believe it is market failure due to inefficient distribution of goods and services?” He also suggested the BIDS to conduct researches on the financial market, as there are many media reports on the market.
“You can check as to whether the banking sector has oligopoly or not,” he added.
(FE)