The target of 7.2 percent GDP growth in the upcoming fiscal won’t be fulfilled as it is not realistic considering different economic indicators, according to an immediate reaction to the proposed budget for 2021-22 from the Centre for Policy Dialogue, a leading think-tank.
“We think that the 7 percent plus GDP growth will not be materialistic and fulfilled,” said CPD Executive Director Fahmida Khatun at a virtual press conference in the evening.
Noting that 6.1 percent GDP growth is being recorded in the outgoing fiscal year, she said, “We think there is a thin possibility to attain the higher growth than it (growth in outgoing fiscal), considering what we are seeing in other economic indexes. Rather it might be less ( than 6.1 percent).”
The CPD Executive Director said the targets for overall revenue collection, expenditures, investment and other things are not realistic either.
“No significant change is not in the revenue collection. If we compare it with the revised budget, we see a discrepancy between the budget implementation rate in the 10 months and the proposed revenue target… The target for revenue collection would be raised by 30 percent, which is much higher,” she said.
Fahmida said some structural changes are seen in financing the budget. Resources would be mobilised from foreign sources to finance the budget, which is a welcoming matter and it has been done rightly. Because, the private sector may require loans from the country’s banks, though the private investment is not increasing yet, she added.
She said now Bangladesh is in a comfortable zone to repay loans as the debt-GDP ratio remains at a satisfactory stage, but Bangladesh needs to be careful so that the ratio does not spike.
The CPD executive director said it is not that budget that would have required to face the Covid-19 on the one hand and recover the economy on the other hand.
The implementation of the Covid-period budget would be a challenge due to weak projections and limitations in implementation, she said.
“In this budget, there should have been clear indications for several years over health, education, social and employment sectors, expenditure structures in other sectors, and revenue collection,” she said.
Fahmida said no tax justice was seen in this budget as the tax-free income limit has been kept unchanged. If the limit would have been raised, low-income people would have disposable income in their hands, she added.