A confidence-boosting budget

Published : 01 Jun 2023 08:27 PM

Amid global economic headwinds Finance Minister AHM Mustafa Kamal on Thurs­day unveiled a Tk7,61,785 crore proposed national budget for the 2023–24 fiscal year in the national parliament. It needs to be mentioned that this is the largest-ever budget for Bangladesh and the theme of the budget has been shaped by the notion of "Smart Bangladesh", envisaging a 100 per cent digital economy, science and technology-based literacy, and a paperless and cashless society. 

There is perhaps no other part of the world where the annual budget is more keenly awaited or debated. The story of  Bangladesh’s budget is far from over, but, it needs no emphasising that this is a confidence-boosting budget. Critics will come up with their obvious criticisms though many of the naysayers still admit, “No harm done.” The people of this nation can now go ahead with growth story under the able leadership of Prime Minister Sheikh Hasina, knowing that the government is fully behind them. 

Reportedly, the proposed budget will be 15.2 per cent of the Gross Domestic Product (GDP). The budget size is likely to be Tk1,01,278 crore higher than the revised budget of Tk6,60,507 crore in the outgoing fiscal year. We have come to know that the government targets a possible revenue collection of Tk5,03,900 crore, around Tk67,000 crore more than that in FY23. There is no denying that Bangladesh is right now one of the fastest growing economies in the world. But the country will have to strive to tame inflation, strengthen social safety net, revamp its education system and incentivise exports and trade, if it is to keep growing in the changing world scenario.

Finance Minister AHM Mustafa Kamal in his budget speech for the Fiscal Year 2023-2024 said  that the dreams of "Smart Bangladesh" will be realised based on four main pillars: smart citizen, smart government, smart society and smart economy. Implementation of projects has already started from various ministries to establish “Smart Bangladesh”. Every ministry has been instructed by the cabinet division to undertake at least one project a year supporting the establishment of “Smart Bangladesh”.

We are told that in “Smart Bangladesh”, the per capita income will be at least $12,500, less than 3 per cent of people will be below the poverty line and extreme poverty will be reduced to zero. Healthcare will reach everyone's doorstep. All the services required by the citizens will be at their door steps, including automatic communication system and sustainable urbanisation. A paperless and cashless society will be created. Most importantly, a society based on justice and equality will be established in “Smart Bangladesh”. 

Needles to say, in order to fuel our journey towards “Smart Bangladesh”, it is important for us to integrate efforts in information and communications technology. Over the last four years, we have witnessed the burgeoning of the ICT sector in the country. From the adoption of computers in government offices for record-keeping to the increased use of credit and debit cards throughout shops and merchants, the use of ICT is everywhere. We have introduced newer and efficient ways for our foreign workers to send remittance back to their homeland. There is no doubt that these initiatives are impressive but compared to most industrialised nations of the world we are still in the early stages, and there is still a lot to be done to materialise the dream of a “Smart Bangladesh”. 

The proposed budget also aims at taming inflation alongside achieving higher GDP growth. It is worth mentioning that the government this time is eying to attain a growth rate of 7.5 percent in the next fiscal year (FY24) while to contain the inflation rate around 6.5 percent. Despite infrastructure bottlenecks and shortage of power in industry, country's major macroeconomic indicators like the growth rate Gross Domestic Product (GDP) remarkably increased in the last fiscal year. Reportedly, GDP growth rate in the country in the last fiscal year (FY22) reached a healthy 7.10 percent braving the shocks from the Covid-19 pandemic and the Russia-Ukraine conflict. As a result of the government’s various endeavours, country's major macroeconomic indicators like the growth rate of GDP to remarkably increased and Bangladesh has set a target to achieve 8.51 percent GDP growth by 2025. However, in order to achieve the target of 8.51 per cent gross GDP growth rate by 2025 and make this growth more inclusive, the government must ensure job security and create job opportunities in the private sector.

It needs no emphasising that this is a confidence-boosting 

budget. The people of this nation can now go 

ahead with growth story under the able 

leadership of Prime Minister Sheikh Hasina, 

knowing that the government 

is fully behind them

The poverty rate in Bangladesh, despite the global crisis, declined by 5.6 percent in seven years from 2016 to 2022 due to various programmes taken by the government.  In view of enviable success in various socio-economic indicators in the last decade under the pragmatic leadership of Prime Minister Sheikh Hasina, Bangladesh has now become a middle-income country. The remarkable development that the country has gained over the last ten years has instilled the confidence into people that becoming a developed nation is very much possible. The incumbent  government has successfully reduced the country’s poverty rate by 50 percent in the last ten years.  However, the country has set an ambitious target to alleviate extreme poverty to 2.3 percent by 2031 and moderate poverty to below 3 percent by 2041. In order to chase this target within the stipulated time, necessary initiatives should be taken to address some key issues such as climate change, natural disasters and weak rural infrastructure which have long been deterring our efforts towards eradicating poverty.

The global health crisis caused by Covid-19 hit Bangladesh's economy hard and jeopardised the country's impressive achievements in poverty reduction. There is no denying that the government is providing allowance for the poor and needy. But apart from giving allowance, it has become more of a necessity to involve the poor in income-generating works.

Though we have achieved enviable success in poverty alleviation, the rate of poverty reduction is not adequate compared to the country’s striking growth rate. Also, the rich-poor divide has been growing remarkably in Bangladesh.  Hence,  the government should give more priority to inclusive and micro-level development than economic growth. In order to make our economic growth more inclusive, the government must take initiatives for enhancing poor people's participation in economic activities.

Sayeed Hossain Shuvro is working as Editorial Assistant at Bangladesh Post