Full policy-support for accelerated industrial development
Saturday, 13 March 2010
Dilip Barua
THE pre-budget workshop on "Tariff and Non-tariff Structures in the Upcoming National Budget: Expectations of the Industrial Sector" at the initiative of the Ministry of Industries is first of its kind in the country. This discussion is aimed at reflecting the aspirations of the industrial entrepreneurs and business community in the national budget. We would hope that discussions at this workshop would be able to guide the formulation of an industry friendly budget through the interactions with, and exercise among, the most experienced and wisest personalities of different industrial sectors.
After taking over the office as the Minister for Industries I have discussed with the cross-section of people related to trade and industry. I met individually with all the leading chambers of the country. Moreover, I have had elaborate discussions with various association leaders of different industrial sub-sectors. Among the meetings, budget was the common issue that the businessmen and industrialists focused on. Most of them talked about the existing tariff and non-tariff structure in the budget. Many of them suggested restructuring the current duty and tax structure in the interest of promoting the growth of the domestic industry. They complained that the present duty and tax structure is not in favour of domestic industrial growth. Rather, to some extent the existing duty and tariff structure, as they noted, has hindered the development of local industrialisation. Local products fail to compete as the duty and tax on imported finished products are lower than that of locally manufactured products. A pragmatic and logical solution is necessary for the betterment of our local industries.
It has been a general practice that businessmen and industrialists criticised the budget after its declaration. They also demand to bring about necessary budgetary changes claiming that the provisions of the budget are not in favour of business and industry. I take it in a positive attitude as because the government has responsibility to safeguard the local industry. There must be a safety value in the budgetary provision in favour of local industries and its betterment. It is important to discuss the matter with the stakeholders before the declaration of the budget. If we are able to do so, the logical and practical suggestions and recommendations provided by the stakeholders will be reflected in the budget. And then we would be able to formulate an industry-friendly budget.
The present Grand Alliance Government under the dynamic and visionary leadership of our Prime Minister Sheikh Hasina, is working relentlessly, aiming at building a middle-income industrialised Digital Bangladesh by 2021. It had to face the negative impact of global downturn immediately after taking power. Moreover, due to globalisation and free market economy, only tariff and non-tariff barriers are not enough to protect the interest of the local products. Product quality and price are the main tools to have a greater market share. None can hinder its progress if the products are of high quality and cheaper compared to others. Even it does not matter from where the product is originated or manufactured. The government may impose some tariff and non-tariff barriers to safeguard the interest of the local products. But it has a drawback, too.
The government may fail to safeguard cent per cent the locally manufactured products due to international trade and business context, pressure from the donors and development partners, World Trade Organisation (WTO) regulations and for many regional trade agreements. In this perspective, productivity needs to be increased to develop the industry of Bangladesh. We need to increase our industrial efficiency and productivity to compete with the changing global economic and business scenario. We should be more strategic in the field of economic diplomacy. We need to identify our own economic and business strategy by scrutinising and researching the tariff and non-tariff barriers policy of other country.
The world is currently facing a business cold war to gain financial momentum though traditional political cold war does no more exist due to globalisation. All the countries - developed, developing and undeveloped - have been trying hard and soul to sustain their trade position in the world market. Specially, the industrially developed countries are manufacturing products of new fashion and design on a regular basis by doing market research. We must be winner in the existing business cold war if we want to achieve our desired goal of being an industrially developed country. For this reason, we will have to handle the financial and trade issues with intellect and strategy to turn the issues in favour of us. We should utilise our own intellect, creativity and efficiency in order to face the global financial competition. We must play a pioneering role, instead of depending on the government. We do hope that the local renowned and enlighten entrepreneurs and industrialists would carry out their best effort in this regard.
The present government wants to build a sustainable and modern industrial sector. For this, the government is giving priority to boost the local industry. It is also looking into the matters to identify the effective measures and options in the export-import policy for the benefit of the domestic industry. The government will take necessary steps, incorporating the recommendations and suggestions of businessmen, industrialists, civil society, worker-leaders and the media. The Ministry of Industries has already decided to increase the contribution of industrial sector to the gross domestic product (GDP) to 40 per cent from existing 28 per cent. For this, we have no alternative except promoting our local industry. Beside, we need to fulfill the national demand from our own local production and produce almost all the import-substituting products in our country. At the same time, we must diversify and strengthen our export-oriented sectors.
The government has already decided to set up specialised economic zones to diversify the export-oriented products. We have taken effective measures in order to minimise the existing shortage of supply of electricity and gas as it is the driving force of industry. Projects have been taken to generate electricity from coal, solar energy and from other sources. Besides this, we are taking measures to restructure the tax structure, after identifying the industrial thrust sectors. We hope that our `industry will move towards the desired goal because of the initiatives taken by the government. Moreover, implementation of e-commerce, e-business and other information communication technology (ICT) in the field of industry and business will gear up our effort to make it possible to achieve an industrialised Bangladesh by 2021. We believe we would be able to make a middle-income industrialised Digital Bangladesh for giving a practical shape to the dream of the nation, Bangabandhu Sheikh Mujibur Rahman.
The aim of the present government is to set up a vibrant private sector in order to ensure harmonious economic development and to change the living standard of the citizen. In order to achieve this goal, the government will work as a facilitator, instead of a regulator. We will provide every possible support in order to promote private sector. Our efforts to organise this workshop bear testimony to the government's promise. We will step towards our desired goal through this public-private partnership.
(This is an edited version of written introductory remarks by the Minister of Industries to a workshop held in the city last Tuesday)
THE pre-budget workshop on "Tariff and Non-tariff Structures in the Upcoming National Budget: Expectations of the Industrial Sector" at the initiative of the Ministry of Industries is first of its kind in the country. This discussion is aimed at reflecting the aspirations of the industrial entrepreneurs and business community in the national budget. We would hope that discussions at this workshop would be able to guide the formulation of an industry friendly budget through the interactions with, and exercise among, the most experienced and wisest personalities of different industrial sectors.
After taking over the office as the Minister for Industries I have discussed with the cross-section of people related to trade and industry. I met individually with all the leading chambers of the country. Moreover, I have had elaborate discussions with various association leaders of different industrial sub-sectors. Among the meetings, budget was the common issue that the businessmen and industrialists focused on. Most of them talked about the existing tariff and non-tariff structure in the budget. Many of them suggested restructuring the current duty and tax structure in the interest of promoting the growth of the domestic industry. They complained that the present duty and tax structure is not in favour of domestic industrial growth. Rather, to some extent the existing duty and tariff structure, as they noted, has hindered the development of local industrialisation. Local products fail to compete as the duty and tax on imported finished products are lower than that of locally manufactured products. A pragmatic and logical solution is necessary for the betterment of our local industries.
It has been a general practice that businessmen and industrialists criticised the budget after its declaration. They also demand to bring about necessary budgetary changes claiming that the provisions of the budget are not in favour of business and industry. I take it in a positive attitude as because the government has responsibility to safeguard the local industry. There must be a safety value in the budgetary provision in favour of local industries and its betterment. It is important to discuss the matter with the stakeholders before the declaration of the budget. If we are able to do so, the logical and practical suggestions and recommendations provided by the stakeholders will be reflected in the budget. And then we would be able to formulate an industry-friendly budget.
The present Grand Alliance Government under the dynamic and visionary leadership of our Prime Minister Sheikh Hasina, is working relentlessly, aiming at building a middle-income industrialised Digital Bangladesh by 2021. It had to face the negative impact of global downturn immediately after taking power. Moreover, due to globalisation and free market economy, only tariff and non-tariff barriers are not enough to protect the interest of the local products. Product quality and price are the main tools to have a greater market share. None can hinder its progress if the products are of high quality and cheaper compared to others. Even it does not matter from where the product is originated or manufactured. The government may impose some tariff and non-tariff barriers to safeguard the interest of the local products. But it has a drawback, too.
The government may fail to safeguard cent per cent the locally manufactured products due to international trade and business context, pressure from the donors and development partners, World Trade Organisation (WTO) regulations and for many regional trade agreements. In this perspective, productivity needs to be increased to develop the industry of Bangladesh. We need to increase our industrial efficiency and productivity to compete with the changing global economic and business scenario. We should be more strategic in the field of economic diplomacy. We need to identify our own economic and business strategy by scrutinising and researching the tariff and non-tariff barriers policy of other country.
The world is currently facing a business cold war to gain financial momentum though traditional political cold war does no more exist due to globalisation. All the countries - developed, developing and undeveloped - have been trying hard and soul to sustain their trade position in the world market. Specially, the industrially developed countries are manufacturing products of new fashion and design on a regular basis by doing market research. We must be winner in the existing business cold war if we want to achieve our desired goal of being an industrially developed country. For this reason, we will have to handle the financial and trade issues with intellect and strategy to turn the issues in favour of us. We should utilise our own intellect, creativity and efficiency in order to face the global financial competition. We must play a pioneering role, instead of depending on the government. We do hope that the local renowned and enlighten entrepreneurs and industrialists would carry out their best effort in this regard.
The present government wants to build a sustainable and modern industrial sector. For this, the government is giving priority to boost the local industry. It is also looking into the matters to identify the effective measures and options in the export-import policy for the benefit of the domestic industry. The government will take necessary steps, incorporating the recommendations and suggestions of businessmen, industrialists, civil society, worker-leaders and the media. The Ministry of Industries has already decided to increase the contribution of industrial sector to the gross domestic product (GDP) to 40 per cent from existing 28 per cent. For this, we have no alternative except promoting our local industry. Beside, we need to fulfill the national demand from our own local production and produce almost all the import-substituting products in our country. At the same time, we must diversify and strengthen our export-oriented sectors.
The government has already decided to set up specialised economic zones to diversify the export-oriented products. We have taken effective measures in order to minimise the existing shortage of supply of electricity and gas as it is the driving force of industry. Projects have been taken to generate electricity from coal, solar energy and from other sources. Besides this, we are taking measures to restructure the tax structure, after identifying the industrial thrust sectors. We hope that our `industry will move towards the desired goal because of the initiatives taken by the government. Moreover, implementation of e-commerce, e-business and other information communication technology (ICT) in the field of industry and business will gear up our effort to make it possible to achieve an industrialised Bangladesh by 2021. We believe we would be able to make a middle-income industrialised Digital Bangladesh for giving a practical shape to the dream of the nation, Bangabandhu Sheikh Mujibur Rahman.
The aim of the present government is to set up a vibrant private sector in order to ensure harmonious economic development and to change the living standard of the citizen. In order to achieve this goal, the government will work as a facilitator, instead of a regulator. We will provide every possible support in order to promote private sector. Our efforts to organise this workshop bear testimony to the government's promise. We will step towards our desired goal through this public-private partnership.
(This is an edited version of written introductory remarks by the Minister of Industries to a workshop held in the city last Tuesday)