The finance minister, AMA Muhith, in the proposed budget for the next fiscal year 2013-14 set yet another ambitious target of 7.2 per cent growth of gross domestic product despite failing to achieve the GDP growth targets in the previous two budgets.
Muhith, who had set a GDP growth target of 7.2 per cent for the outgoing fiscal year 2012-13, on Thursday set the
same target for the next fiscal year banking on the rebound of the global economy and some domestic factors.
The Bangladesh Bureau of Statistics recently estimated that the GDP growth in the outgoing fiscal year would be 6.03 per cent against the target of 7.2 per cent.
Economists, on the other hand, said that another 7.2 GDP growth target for the coming fiscal year would be ambitious given the ongoing political crisis that may continue in the run up to elections slated to be held in early 2014.
‘According to projections, growth will accelerate in agriculture, industry and service sectors propelled by the positive momentum in the world economy in 2013 and afterwards,’ Muhith said while presenting the proposed budget in Parliament on Thursday.
He hoped that the infrastructure deficit would be mitigated considerably because of the steps taken by the government in tackling supply side constraints in power, energy and
communication sectors.
‘Based on these underlying assumptions and expectations and also keeping in view the trends of other emerging Asian economies, we have re-fixed the real economic growth target at 7.2 per cent for FY 2013-14,’ he said.
Centre for Policy Dialogue executive director Mustafizur Rahman on Saturday said that it would be overly ambitious if the government targeted 7.2 per cent GDP growth in the coming budget.
He said there will be a need of 30 per cent investment of the GDP to achieve such a higher target. ‘Otherwise, it’ll be very difficult, a big portion of investment should come from the private sector but credit growth is slow.’
Muhith also ditched the BBS estimate of 6.03 per cent GDP growth for the outgoing fiscal year, saying that the growth would be between 6.3 per cent and 6.8 per cent.
He said that BBS estimated GDP growth was based on the data of eight months while the growth of agriculture and investment would be much higher than the BBS estimate.
In FY 2011-12, Muhith had set a target to achieve 7 per cent growth while the actual growth was 6.7 per cent.
-With New Age input
