Challenge lies on investment front

Boosting investment from the private sector is the main challenge in 2016, which also requires addressing the governance-related problems for ensuring 'feel good' factor for the investors.
After passing a lacklustre period of investment in 2015, the new year comes with the challenge, opined economists and businessmen while talking with the FE.
They also added that without higher investment, there would be little employment generation in the country, and economic growth would also not cross the 7.0 per cent level.    
The Seventh Five Year Plan (7th FYP) projects increasing the ratio of private investment to GDP (Gross Domestic Product) at 23.7 per cent in 2016, which is now 22.07 per cent.
Dr Ahsan H Mansur, executive director of the Policy Research Institute (PRI), said there is no doubt that increasing investment would be the prime challenge in the new year.
"Policy support is a must to boost up investment," he told the FE.
"Lending rate needs to be lower to reduce the cost of financing. At least five to 10 special economic zones (SEZs) should be operationalised. A special infrastructure fund could be created."
The economist also said security situation across the country has been deteriorated, and so it needs urgent attention.
"Improved security is essential for both domestic and foreign investors. Curbing the corruption is a continuous challenge also," he added.
Dr Zahid Hussain, lead economist in the World Bank Dhaka Office, observed that governance-related problems need to be addressed, so that investors could get a strong message.
"The country's financial sector suffered due to bad governance. But no strong remedial action was visible last year." 
He was of the view that the government should actively work on reducing corruption.
Md. Jashim Uddin, a director of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), expressed optimism that 2016 would be a positive year for peaking up investment, as there would be a favourable political atmosphere.
"We all know that investment situation was not encouraging in 2015," he said while talking with the FE.
"There was a shortage of gas and electricity. Political disturbance in the first three months also discouraged new investment."
Mr Jashim opined that the government needs to address the power situation and adjust policies in line with global development to enhance private investment.
"Production of electricity has increased, but its distribution mechanism is still very weak. So, businesses are suffering from lack of quality and uninterrupted power supply. Gas is another big problem. Many industrial units are waiting for gas connection," he explained.
Supporting the business leader's view, Dr Mansur said as enhanced supply of gas would be difficult, the government needs to ensure quality supply of electricity to all industries.
Mr Jashim, also vice chairman of Bengal Group of Industries, pointed out that India regularly adjusts domestic fuel prices with global price while Bangladesh is yet to do that.
"Global oil price came down from $110 per barrel to $40 in last one and half year, but we are still paying domestic oil price based on over $100 per barrel. So, Bangladeshi exporters are losing competiveness," he concluded.
On addressing the major concerns of the businessmen and entrepreneurs, Dr Mansur suggested formation of a special taskforce like India.   
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