Saturday, 15 June, 2024, Reg No- 06
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Budget eyes curbing inflation, stabilizing market

Published : Thursday, 23 May, 2024 at 12:00 AM  Count : 276

In order to give relief to the people in the daily commodity market, matter of reducing the price of commodities is being given top priority in the new budget. That is why most emphasis is given on inflation control.

Last April, food inflation increased another step. Due to this, the consumers have to buy most of the daily products at a higher price. Experts say that the biggest challenge facing the government at the moment is to curb inflation.

Finance Minister Abul Hassan Mahmood Ali recently said that he will try to meet everyones demands in the next budget. Regarding increasing the allowance of freedom fighters, he said that Prime Minister Sheikh Hasina will take the final decision in this regard. Apart from this, the allowance of senior citizens will be increased.

Either way, relief should be brought back to the market. Prime Minister Sheikh Hasina has already approved the proposed budget for the fiscal year 2024-25.

He gave special instructions to control inflation there. The size of the main budget for the next fiscal year 2024-25 is likely to be Tk 796,900 crore which is said to be 4.62 per cent more than that of the current fiscal year 2023-2024. The is current national budget is Tk 7,61,785 crore. At the same time, the possible target of growth is 6.5 per cent. Achieving growth is less important than focusing on controlling inflation.

Finance Minister Abul Hassan Mahmood Ali will present the budget in the Parliament on Thursday, June 6.

Prime Minister Sheikh Hasina expressed her satisfaction seeing that the manifesto of Awami League has been reflected in the new budget. The budget has emphasized on things that will bring relief to the common man. NBR is taking special steps in the budget to ensure that the prices of imported daily commodities do not increase.

Apart from this, Prime Minister Sheikh Hasina has directed to give top priority to inflation control in this years budget. It has been emphasized that the prices of daily and consumer goods should not increase in any way.

Apart from this, timely delivery of TCB products to one crore of families, continuation of open market sale (OMS) programme, continuation of rice sale programme at Tk 15 in rural areas through dealers, Food for Work (FFW) programme and protection of more people under social security.

There will be a special announcement in the budget for TCB activities to be extended to provide subsidized food products to low income people.

According to Bangladesh Bureau of Statistics, food price inflation rose to 10.22 per cent in April, which was 9.87 per cent in March. Food inflation is higher in villages than in cities. Because of this, ordinary people with limited income have suffered. Food price inflation of 10.22 per cent in April means that in April 2023, the same product that was bought in April 2023 will cost Tk 110.22 more. Last February, food price inflation was 9.44 per cent.

Earlier in April 2023, national food inflation was 8.84 per cent. However, in the new budget, the government wants to keep inflation within 6.5 per cent. But controlling inflation is considered a challenge due to internal and external crises.

The Ukraine-Russia, Israel-Palestine wars and Middle East crises are now affecting the global economy. The price of dollars in the country is constantly increasing. This increases the import cost. As a result, the prices of all kinds of daily products are increasing.

The Minister of State for Finance Wasika Ayesha Khan said, "High inflation is prevailing all over the world. Like other countries we have high inflation here. Inflation rate in Turkey is over 60 per cent. However, in the new fiscal year, the budget has been formulated with the objective of controlling food inflation at any cost. Apart from this, Prime Minister Sheikh Hasina has directed to reduce inflation and bring relief to the market. As a result, inflation control is being given top priority in the budget.

Meanwhile, the government has approved the annual development programme (ADP) The National Economic Council (NEC) approved a Tk 265,000 crore for the next fiscal year (FY25), putting the highest allocation of Tk 70,687.75 crore (26.67 per cent) in the transport and communication sector.

Briefing reporters after the meeting, Planning Division Senior Secretary Satyajit Karmakar said that of the total ADP outlay of Tk 2,65,000 crore, Tk 1,65,000 crore will come from the local sources and Tk 100,000 crore from foreign sources. The original ADP size for the outgoing fiscal year (FY24) was Tk 263,000 crore.

There, ten sectors have been given top priority, including inflation control. In addition to this, taking new steps in consideration of the global economic crisis, building a smart Bangladesh, continuing the trend of growth, controlling inflation by keeping the budget deficit at conceptual level, speeding up the My Village My City plan, ensuring food security for all, increasing the scope of social security, digital special measures will be taken in the budget to focus on education, expedite completion of fast-track infrastructure projects and address climate change risks.

Economists say that the big challenge before the new government is to deal with the economic crisis. They think that the government should give maximum importance to this sector. According to economists, one of the biggest economic challenges facing the new government is controlling high inflation. Then to stabilize the unstable dollar market.

The executive director and economist Center for Policy Dialogue (CPD) recently researched on inflation control Fahmida Khatun said that there are many economic challenges in front of the government. But the biggest challenge right now is to control high inflation.

 Inflation in the country is now over 10 per cent. The government will not be able to suddenly reduce inflation with a magic wand. The next challenge in the economy is the dollar crisis. The dollar market is in turmoil right now. If the dollar is not brought back in order, it will be very difficult to meet the challenges of the economy.

Meanwhile, inflation was above 9 per cent throughout 2023. Because of this, the low income people of the country have suffered all year round. Bringing this inflation under control will be the biggest challenge for the government in the new year. Apart from this, abnormal decline in reserves, turbulent dollar market, distress in the banking sector, reduced credit growth in the private sector, reduced public-private investment, inability to create employment, increased government debt and repayment of loan interest are also major challenges for the government.

In this context, the executive director of the Policy Research Institute (PRI) Ahsan H Mansur said, currently the thorn in the neck of the economy is the dollar crisis. Bangladesh Bank could not overcome the dollar-crisis despite various steps. The dollar price is market based. The dollar is selling at a price higher than the fixed price in the open market. As a result, import costs are increasing. The prices of daily commodities are increasing. It is important to have specific guidelines on these issues in the budget.

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