Poor people are most affected in terms of both economy and health. At present 100.22 million people face high risk of economic and health vulnerabilities. The average family income loss between March and May hovers at around 74 per cent due to the impacts of COVID-19, said a study report, released on Monday.
It also said that over 1.4 million migrant workers have returned or are on their way back home due to job loss.
The study was conducted jointly BRAC, DataSense and Unnayan Shamannay, attempting to develop a vulnerability index.
The findings and recommendations of the study titled "COVID-19 and national budget 2020-2021: Rethinking strategy for bottom of the pyramid" were revealed at a digitally organised press conference on Monday.
Dr Hossain Zillur Rahman, noted economist, chairman of Power and Participation Research Centre (PPRC) and chairperson of BRAC, presided over the event with Dr Atiur Rahman, former governor of Bangladesh Bank, present as the chief guest. KAM Morshed, senior director, BRAC, moderated the press conference.
Dr Ananya Raihan, chief executive officer, iSocial, presented the survey report. Dr Nazneen Ahmed, senior research fellow, Bangladesh Institute of Development Studies (BIDS), and Dr Imran Matin, executive director, BRAC Institute of Governance and Development (BIGD), were present as panel speakers.
The findings and recommendations of the study are drawn from holistic reviews of a number of studies recently conducted by BRAC, BIGD, PPRC, International Monetary Fund and other national and international bodies, along with the data obtained from a primary survey, which was conducted on 962 respondents randomly selected from 25 districts of the country, during the period of May 15-18, 2020.
The primary survey reveals that the pandemic has variously affected the low-income people. It shows that 34.8% of households interviewed have at least one member who lost their job. The average family income loss between March and May hovers at around 74%. People in the informal sector, including day-labourers, have suffered most.
The manufacturing sector also experienced a major blow. For example, the readymade garment sector experienced 84% reduction in exports in April 2020 compared with April 2019. Between mid-March and April 7, 2020, 1,116 factories have been reported closed and 2.19 million workers lost their job.
The study further reveals that -
The COVID-19 is causing new kinds of economic, social and digital divides. As only 34% of households have access to smartphones and 54% have access to TV, children of the lowest economic rung mostly remain excluded from any form of education provided through digital channels.
Dr Atiur Rahman said, "Medium, small and micro enterprises need help as 60% of them will be out of business. We can allocate BDT 20 thousand crore for this sector. The entire BDT 20 thousand crore needs to be refinanced by the Bangladesh Bank. Banks are not interested to give loans to MSMEs which they don’t know. Refinance line has to be increased so that risk sharing by bank is promoted."
"There is no risk of inflation yet. Economy is not that vibrant. Fuel prices are low because world market prices are low," he observed.
"Microfinance institutions can be given more refinancing facilities. Also banks should be given credit guarantee schemes so that they are encouraged to provide credit to MSMEs for which budget allocation is required," he further said.
Dr Nazneen Ahmed said, "Fuel subsidy to transport operators can be provided so they will not require to increase fares."
Dr Hossain Zillur Rahman in his chair's speech said, "Instead of making new lists it is best if existing lists can be used. Instead of BDT 100, BDT 500 per head may be allocated as stipend for 7.8 million primary students. That way we can ensure support reaches to the right people."
"The budget needs to be reflective, open to criticism, skilful in strategy," he stressed.
