Overcoming the existing barren investment situation and debt burden and attaining the targeted GDP growth rate would be the key challenges to be dealt with in the budget for the fiscal year 2014-15, economists said Saturday.
They suggested setting realistic fiscal targets based on availability of resources or in view of the demand instead of doing it on an incremental basis.
The country's leading economists came up with the views at a discussion on 'Upcoming budget: promises and challenges' with members of the Economic Reporters' Forum (ERF) at the Dhaka Chamber of Commerce and Industry (DCCI).
Leaders from chambers, readymade garments, textiles and real estate business and stock exchanges also shared their respective proposals on the budget for next FY.
Former Finance Adviser to Caretaker Government Dr AB Mirza Azizul Islam said credibility of budget should be maintained through framing it in a realistic way.
"The budget size would be realistic if it is set at Tk 2.35 trillion for the next FY. The Annual Development Programme (ADP) size could be set at Tk 670 billion for next year," he said, adding that as per his assessment the nine months' expenditure would be to the tune of Tk 280 billion.
Dr Debapriya Bhattachariya, distinguished fellow of the Centre for Policy Dialogue (CPD), said apart from the government, all other experts and development partners estimated the GDP growth below 6.0 per cent for the current fiscal year.
"It would be the fourth consecutive financial year witnessing a fall in the targeted GDP growth rate. This year the GDP growth rate would be the lowest, below 6.0 per cent, in the last 10 years," he said.
He said poor private sector investment was responsible for the fall in the growth rate.
"Such barren situation in investment started in the middle of FY 2012-13, not for only political turmoil last year," he added.
Mr Debapriya said the government was moving around the political trade regime.
He said the economy was yet to regain growth after election.
Former Bangladesh Bank (BB) governor Dr Salehuddin Ahmed said the budget should be framed with an analysis of impact on businesses and common people, not on an incremental basis.
He pointed out that investment, employment generation, equal distribution of resources and poverty alleviation would be major areas of focus.
Dr Salehuddin also recommended framing a consistent policy to attract investments.
Dr Binayak Sen, research director at Bangladesh Institute of Development Studies (BIDS), said achieving the middle income country status would not mean all.
"Critical infrastructure development for intercity connectivity, road and bridges, managing reputational risk and minimum critical compliance should be focused in the budget," he said.
He suggested asset revaluation to bring well-off people under the net of wealth tax and encourage holding productive assets.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) president Atiqul Islam sought tax benefit for relocation of factories from shared buildings.
He also proposed an exit plan for businesses that would wind up business.
Former Real Estate and Housing Association of Bangladesh (REHAB) president Dr Toufiq M Seraj said the sector was suffering a severe blow as sale of flats dropped significantly.
The unemployment problem would surge with the fall in the real estate sector as most of the unskilled workers were being employed in the sector, he added.
Bangladesh Textile Mills Association (BTMA) director Razeeb Haider sought policy support to be competitive in the international market.
He said only cheap labour could not ensure sustainability of local businesses unless energy security and fiscal support were there.
Abdul Mazid, Chittagong Stock Exchange (CSE) chairman and former chairman to the National Board of Revenue (NBR), suggested changing the timeframe of financial year to April-March from July-June in the country's context.
He, however, criticised a large amount of ADP expenditure at the fag end of every financial year without producing goods or services.
Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) president Kazi Akram Uddin Ahmed said there should be a long term vision for development so that budget projection was not wrong.
He, however, urged the government to focus on image building to help the nation come out of the impact of political instability.
Qazi Kholiquzzaman, Chairman of Palli Karma Sahayak Foundation (PKSF), pointed out the unemployment problem, food inflation, infrastructure development and environment issues as the key challenges.
Rakibur Rahman, former president of Dhaka Stock Exchange (DSE), proposed tax incentives for expediting growth of the capital market.
He suggested that the government should frame fiscal measures expanding the tax net, not imposing any tax burden.
Exporters' Association of Bangladesh (EAB) president Abdus Salam Murshedy underscored the need for a 'welfare' budget saying that businesses were not doing well.
President of American Chamber of Commerce Bangladesh (AmCham) Aftab-ul-Islam proposed strengthening the Public Private Partnership and laying emphasis on attracting FDI.
At the discussion, economists urged the government to lay emphasis on institutional reform, focusing on direct tax collection and prioratise health care and education in the next budget.
They said expenditure of public administration and defence could be cut to divert allocations to other sectors.
Veteran journalist Farid Hossain moderated the session. ERF president Sultan Badol and general secretary Sajjadur Rahman also spoke on the occasion.
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