Challenges before the budget (2009-10)
Thursday, 14 May 2009
Salahuddin Ahmed
THE national budget for the fiscal year 2009-2010 is expected to be one of the most high value budgets of all times. Consequent to that, the government of Bangladesh is surely up against a huge challenge of formulating a well-defined budget that needs to address all issues specifically. Budgets of the last two years were formulated by the Caretaker Government. This is going to be the first budget by an elected government after a long gap; so expectations are really high that this budget is going to shaping up our economy meticulously.
There is no doubt that the government needs to formulate this budget with greater commitment and high projected vision. Previously, we have seen that each and every budget does not have full effect on our economy. It is an easy task to formulate a big size budget, but the success lies in the implementation of the proposed budget.
There are some specific issues that this budget needs to focus on explicitly. The issues that should get priority are the long-term development issues of the economy. We have a budget every year, but those budgets need to be integrated so that we can keep our long-term development issues on track. From this year, our government should try its best to create an integrated budget.
What exactly do we mean by this integrated budget? It has been seen that one year the budget focuses on some particular issues; while another year it shifts its focus to other issues. This does not allow the government to complete the long-term development plans. For example, we have been having problem of electricity and water and we have been making efforts every year to solve these issues as they come. We do not have any long-term plan about solving these issues permanently.
The national budget should cover some issues that we do not think so important. One of those is environmental issue that needs very cautious analysis, where environmental issues should get top priority. Our environment is getting deteriorated day by day.
The condition of Dhaka city, in particular, is getting vulnerable, but no action has yet been taken to save Dhaka city. As a result, the capital might face some serious consequences in the near future. It is obvious that Dhaka is the most crowded among all the mega cities in the world and the environment of this city needs to be protected with all steps as necessary.
Very recently, the newly appointed Bangladesh Bank Governor said that despite the economic meltdown, Bangladesh will see a significant GDP growth. The question is whether this GDP will grow automatically or if the Bangladesh Bank along with the government needs to put effort to achieve this growth. It was a great news for Bangladesh, when we learnt that economy fetched US$ 11,634.36 million from exports during the last nine months of the current fiscal (July-March 2008- 09). It is an increase of 14.51 per cent over the last fiscal year.
It is conceivable that our present government needs to develop those sectors more comprehensively that contribute to the growth of export earning. These sectors like knitwear, woven garments, agriculture products, textile, and home textile should get enough finance to contribute more to export earning. The impact of recession is not yet been over in the developed countries. Sooner or later Bangladesh's export would also suffer.
The upcoming budget needs to keep an eye on recession and should forecast the upshot of this economic predicament. That requires a long-term view of the developments taking place all around.
Another very important issue that this budget needs to focus on is the utilisation of grants from various sources. The government is eyeing about US$23.3 billion that will play a big role in the upcoming budget. This amount we are not going to spend in one year. Consequently, a long term plan in utilising this fund is also required for all around development.
The most challenging issue this budget will face is to generate employment opportunity. People will look with anticipation how and what portion of total budget the government will allocate for generating employment. Employment generation is also a long-term issue and cannot be addressed in a short-term way. Garments, agriculture etc., are some sectors where we can generate employment opportunities.
There are many small and medium enterprises (SMEs) that could also be a big source of employment. Adequate funds need to be set aside for financing prospective SMEs that would play a big role in our economy.
Every year Bangladesh faces budget deficit. That is quite understandable given its economic condition. The government needs to foresee the economic situation for the next five or ten years and should work accordingly.
If it can be done, we will definitely get better results in the near future. Proper planning can make all the differences that address development issues on short- mid- and long-term basis. The real challenge of the upcoming budget will be to allocate money to implement all the development activities within the stipulated time.
The writer is an MBA student at Ashland University, OH, USA. He can be reached at email:
sahmed@ashland.edu
THE national budget for the fiscal year 2009-2010 is expected to be one of the most high value budgets of all times. Consequent to that, the government of Bangladesh is surely up against a huge challenge of formulating a well-defined budget that needs to address all issues specifically. Budgets of the last two years were formulated by the Caretaker Government. This is going to be the first budget by an elected government after a long gap; so expectations are really high that this budget is going to shaping up our economy meticulously.
There is no doubt that the government needs to formulate this budget with greater commitment and high projected vision. Previously, we have seen that each and every budget does not have full effect on our economy. It is an easy task to formulate a big size budget, but the success lies in the implementation of the proposed budget.
There are some specific issues that this budget needs to focus on explicitly. The issues that should get priority are the long-term development issues of the economy. We have a budget every year, but those budgets need to be integrated so that we can keep our long-term development issues on track. From this year, our government should try its best to create an integrated budget.
What exactly do we mean by this integrated budget? It has been seen that one year the budget focuses on some particular issues; while another year it shifts its focus to other issues. This does not allow the government to complete the long-term development plans. For example, we have been having problem of electricity and water and we have been making efforts every year to solve these issues as they come. We do not have any long-term plan about solving these issues permanently.
The national budget should cover some issues that we do not think so important. One of those is environmental issue that needs very cautious analysis, where environmental issues should get top priority. Our environment is getting deteriorated day by day.
The condition of Dhaka city, in particular, is getting vulnerable, but no action has yet been taken to save Dhaka city. As a result, the capital might face some serious consequences in the near future. It is obvious that Dhaka is the most crowded among all the mega cities in the world and the environment of this city needs to be protected with all steps as necessary.
Very recently, the newly appointed Bangladesh Bank Governor said that despite the economic meltdown, Bangladesh will see a significant GDP growth. The question is whether this GDP will grow automatically or if the Bangladesh Bank along with the government needs to put effort to achieve this growth. It was a great news for Bangladesh, when we learnt that economy fetched US$ 11,634.36 million from exports during the last nine months of the current fiscal (July-March 2008- 09). It is an increase of 14.51 per cent over the last fiscal year.
It is conceivable that our present government needs to develop those sectors more comprehensively that contribute to the growth of export earning. These sectors like knitwear, woven garments, agriculture products, textile, and home textile should get enough finance to contribute more to export earning. The impact of recession is not yet been over in the developed countries. Sooner or later Bangladesh's export would also suffer.
The upcoming budget needs to keep an eye on recession and should forecast the upshot of this economic predicament. That requires a long-term view of the developments taking place all around.
Another very important issue that this budget needs to focus on is the utilisation of grants from various sources. The government is eyeing about US$23.3 billion that will play a big role in the upcoming budget. This amount we are not going to spend in one year. Consequently, a long term plan in utilising this fund is also required for all around development.
The most challenging issue this budget will face is to generate employment opportunity. People will look with anticipation how and what portion of total budget the government will allocate for generating employment. Employment generation is also a long-term issue and cannot be addressed in a short-term way. Garments, agriculture etc., are some sectors where we can generate employment opportunities.
There are many small and medium enterprises (SMEs) that could also be a big source of employment. Adequate funds need to be set aside for financing prospective SMEs that would play a big role in our economy.
Every year Bangladesh faces budget deficit. That is quite understandable given its economic condition. The government needs to foresee the economic situation for the next five or ten years and should work accordingly.
If it can be done, we will definitely get better results in the near future. Proper planning can make all the differences that address development issues on short- mid- and long-term basis. The real challenge of the upcoming budget will be to allocate money to implement all the development activities within the stipulated time.
The writer is an MBA student at Ashland University, OH, USA. He can be reached at email:
sahmed@ashland.edu