Govt borrowing rises sharply

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Borrowing by the Bangladesh government rose sharply year on year in the four months to October to fund subsidies i n different sectors which business leaders say threaten the growth of the private sector, reports Reuters A senior finance ministry official told Reuters on Tuesday the government borrowed about $2.2 billion from the banking system, more than double the same period in the 201011 fiscal year and surpassing the entire planned borrowing for the full year to June 2012. The government provides huge subsidies to the farming and power sectors as well as supporting the import of fuel oil. Economists and business leaders have asked the government to cut borrowing from the banks to avoid further inflationary pressure and make available funds for p rivate sector development. "The fund is drying and we will not be able to get enough cash from banks for setting up industries ," said Annisul Huq, a leading businessman. He urged the government to cut spending on less important projects and take steps to get funds promised by development partners such as the World Bank, IMF and Asian Development Bank released soon.