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The budget not for the poor: CPD

Published : Saturday, 15 June, 2019 at 12:00 AM  Count : 495

In a post budget press briefing the Centre for Policy Dialogue (CPD) has termed the budget for 2019-20 heavily biased towards the rich while the poor will remain marginalized with income gap is widening in the society.   
"On some parameters the big budget sounded
partly realistic but mostly it lacked clarity. It is not clear how it would be implemented and budgetary targets to be attained," CPD's Distinguished Fellow Dr Debapriya Bhattachariya said making points on major parts of the budget.
The press briefing at a city hotel on Friday was also attended by other senior staff economists of            the think tanks including Acting Executive Director Khondker Golam Moazzam and Towfiqul Islam Khan.
They said the proposed budget with an expenditure of Tk 5, 23,190 crore and deficit of Tk 1, 45,380 crore has many challenges and it lacks clarity how the challenges would be overcome.  
Debapriya said the proposed budget will favor high income people while it has not enough reflection on the lower income people as promised in the government election manifesto.
He said Bangladesh is on the way of becoming a developing country but the budget missed focus on arrangement to improve the condition of the low and middle income people to ensure a balanced growth.
There is no clear direction in this regard. Low income people will not benefit from this budget.
"It is not clarified in the budget that how the huge deficit financing would be met," he said pointing to around 25 per cent of the budget to be funded from borrowing.
It will be difficult to attain the target amid growing troubles in banking sector, private sector investments, widening gap in external account and in growing demand for foreign currencies to meet import liabilities, he said.
He said the government is becoming more dependent on banking sector and the gap in revenue target and target achieved is widening increasing dependence on borrowing. Very soon the cost of borrowing will become a big burden on the budget.  
The CPD fellow said the budget has not taken enough steps to overhaul the fiscal and monetary         policy for bridging the gap between revenue earning and expenditure.
Apart from giving direct monetary incentives to the exporters and remitters, he said devaluation of taka could be considered as a better tool to support export.
Neighboring countries are frequently devaluing their own currencies in this regard, he said. Debapriya also came down heavily upoon the budgetary provision of whitening black money.  
The CPD fellow also raised question about transparency of financial data pointing to mismatch between figures used by Finance Ministry and NBR. The gap is widening, he said.
The proposed banking commission may not deliver unless there is a political will to fix problems in the banking sector, he said.
He however praised the Finance Minister for taking up less number of projects in the ADP this year as a good number of earlier projects are still in limbo.
He also took positively the budgetary target of creating 30 million jobs by 2030, increase tax-GDP ratio to 14 per cent from current 10 per cent by next two years, and attain a double digit GDP growth in four years.
CPD urged the government to bring transparency in large parts of the budget, including taxation regimes and allocations and expenditures against big projects. It has also called for reducing discrimination between higher and lower income people.
This is not a budget for the poor. The election of manifesto (of Awami League) was that the next budget will be for the poor but it's not reflected in the budget.
"The progressive middle-class people are the driving force of the economy, but in the proposed budget, they didn't get that much importance," he said.
"If an independent commission is formed, it'll ensure transparency in the banking sector, but a vested quarter doesn't support such move. The proposed budget goes in favour of the evil force," he added.

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