Local think-tank Unnayan Onneshan has said short-sighted fiscal management and inappropriate monetary policies led to stagnation in investment and weak performance in the real economy of the country. The economic growth in the current financial year 2013-14 is likely to experience a decelerating rate for the third time in a row, it also said in its pre-national budget publication, ‘Dealing with Deceleration: State of Bangladesh Economy and Development 2013-14’ released on Saturday.
The increasing gap between the target and achievement of government revenue collection in the FY14 indicates that the investment capacity in infrastructure will be squeezed, said the UO.
The government experienced a Tk 7,968-crore deficit in revenue collection target set by the National Board of Revenue during the period of July-March of the FY14, it said.
In the FY13, the target of tax revenue collection was Tk 1,16,824 crore against the actual collection of Tk 1,12,746 crore, it mentioned.
The UO also said the rate of growth in the GDP had declined from 6.71 per cent in the FY11 to 6.23 per cent in the FY12 and then to 6.03 per cent in the FY13, which was projected to fall below 6.0 per cent in the FY14.
The think-tank also said the rate of savings and investment to the GDP remained stagnant over the past several years while the gap between the two had assumed an increasing trend lately.
‘It suggested that government’s macroeconomic strategies fall short for converting the savings into investment and holding back the possibility of capital flight,’ the UO said.
In the FY12, the gap between savings and investment was 2.64 per cent of GDP which rose to 2.67 per cent in the FY13, it said.
The UO said the rate of growth in agriculture was coming down in past several years as it was 5.24 per cent in the FY10 which came down to 2.17 per cent in the FY13 leading to declining share of agriculture in the GDP in recent years.
The share of agriculture in the GDP fell to 18.70 per cent in the FY13 which was 19.42 per cent in the FY12 and 20.01 per cent in the FY11.
In the FY11, the rate of growth in the manufacturing sector was 9.45 per cent, which was 2.95 percentage points higher than that in the FY10, whereas the rate decreased to 9.34 per cent in the FY13.
As regards the external balance, a deceleration in the growth of export earnings coupled with declining growth in the export of readymade garments has been observed, said the UO.
‘The growth of total export came down to four per cent in the FY13 from 12.4 per cent in the FY12.’ It said.
It also said that growth in the export of readymade garments also fell to 5.5 per cent in the FY13 from 12.7 per cent in the FY12.
The amount of total employed and unemployed people were 34.8 million and 1.4 million respectively in 1995, whereas the amount increased to 54.5 million and 2.6 million respectively in 2010.
‘If the current trend continues, the number of unemployed population may reach 3.3 million by 2015, causing the opportunity of demographic dividend to remain missed and elusive’, the UO observed.
The research organisation also pointed out that there had been decelerated decline in the incidence of poverty, coupled with increased number of unemployed, particularly youth and educated and decreasing allocation of budget and poor status of Annual Development Programme implementation in the social sectors.
-With New Age input
