Bangladesh's economy has achieved an average growth of 6.0 per cent over the last five years primarily due to the healthy inflow of remittance and rising exports. Both the exports and the remittance flow from expatriate Bangladeshis have doubled over the last five years despite many hurdles. Bangladesh's economy has progressed over the past five years despite various challenges like the global economic downturn and the country's restive politics marked by frequent strikes. Economists say exports, remittances and foreign exchange reserves have formed a growth triangle that has helped Bangladesh pull a large part of its population out of poverty.
In the event of exports, there were problems with gas and power supplies besides weak infrastructure. Apart from the fire incidents at the Tazreen Fashions and Standard Garments and the loss of over 1000 lives in the Rana Plaza collapse, the apparel sector has been plagued by continuous labour unrest. The European countries and the US are reducing import of readymade garments due to economic slowdown. Still, the export income is rising. The foreign currency reserve has been strong due to the increased export income and the buoyant remittance flow. The finance minister expects that the export income will increase in the coming days. According to him, the yearly export earnings will be US$ 75 million within the next five years and will cross the target of US$ 30.05 billion in the current fiscal year, 2013-14. At least 20 per cent growth is required in the export sector per year for overall development of our economy. It seems difficult but not impossible at all.
Our foreign exchange reserve has crossed US$ 20 billion for the first time in history and increased 41 per cent in the last month compared to the same period in the last fiscal year. The reserve was US$ 14.22 billion in April, 2013. Bangladesh's central bank has taken time-befitting steps to keep the value of taka stable against US dollar, extended the area and increased the size of the Export Development Fund and given incentives to the exporters jointly with the government to increase the forex reserve. Now, we can tide over many external shocks with our healthy forex reserve.
Bangladesh introduced a liberal trade policy in 1990s but still it needs more liberalisation. We must relax our export policy further in order to increase the volume of exports. We must take some other steps, if we expect to gain 20 per cent growth yearly. The Dhaka-Chittagong highway project must be completed as early as possible and the gridlock on the highway must be reduced to the zero level so that products and goods can be transported without any hassle. Apart from this, exports through the Mongla seaport must be emphasised instead of depending on only the Chittagong seaport. At the same time an automation system is a crying need at both the ports, if we want to prevent corruption.
Load shedding was a long term problem in Bangladesh but recently it has declined to some extent as we have the capacity to produce 10,000MW electricity a day. The demand for electricity has been increasing by 10 per cent every year. So, we must attain the ability to produce 15, 000 MW electricity per day. Apart from that, industrial units and exporters should have their access to enough gas so that they can continue their production.
Besides, more new steps should be taken to aid exporters in keeping the growth in exports stable. They can be offered an interim incentive package, subsidy, a cut in the import duty or zero import duty for export-oriented units etc. We must seek facilities for our exporters from other countries, especially those already benefiting from exports to Bangladesh.
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