Govt plans to raise private investment to spur growth
Sunday, 13 December 2009
Nazmul Ahsan
The government plans to raise private sector investment to 30- 32.5 per cent of the country's Gross Domestic Product (GDP) to boost economic growth to eight per cent by 2013, a finance ministry policy paper said.
Presently, investment from the country's tens of thousands of private entrepreneurs is less than 20 per cent of the GDP, resulting in a gaping hole in the amount of fund needed to spur growth.
The paper has identified a number of policy steps and a host of ambitious infrastructure projects to increase private investment to the required level in an effort to achieve the targetted growth.
Ministry of Finance officials said the paper has already been finalised and would be sent to the Prime Minister Sheikh Hasina soon for approval.
Ensuring energy security, enhancing efficiencies of ports and implementing large infrastructure projects are three most urgent policy steps identified by the paper to catalyse private sector investment.
"We have identified the policy steps to implement the medium term targets included in the government's Vision-2021 by 2013," a senior official told the FE.
"A strong political will can implement the targets, which are achievable if policies are fine-tuned,'' he said.
As part of the plan, a fund worth $9.5 billion was now being created for the power sector alone.
The paper has stressed creating a pool of bureaucrats to implement Public-Private Partnership (PPP) related projects and strengthen Board of Investment (BoI), now assigned to oversee the PPP-related activities.
It said budgetary allocation of Tk 25 billion, earmarked for the projects under the private-public initiative, should be utilised to create a momentum in the government's plan to invigorate the PPP.
It added the government must implement large projects like Dhaka-Chittagong access control highway, sky-train encompassing the Dhaka metropolis, Dhaka city subway and Dhaka-Narayanganj-Gazipur-Dhaka elevated expressway through private sector to boost growth.
As the issue of investment -- be it public or private -- requires direct involvement of bureaucrats, the paper recommended forming a high-powered commission to enhance expertise of public servants.
It also suggested creating a market-oriented education system to prepare future managers and executives for the booming private companies and bringing about changes in traditional institutional framework of the government.
The policy paper also called for planning development projects only after considering impacts of climate change to ensure a sustainable development.
The target to achieve eight per cent GDP growth by 2013 is included in the Medium Term Targets of Vision 2021 of the ruling Awami League (AL) party.
Reducing the present rate of poverty to 25 per cent and extreme poverty to 15 per cent are two other major targets set by the AL.
The government plans to raise private sector investment to 30- 32.5 per cent of the country's Gross Domestic Product (GDP) to boost economic growth to eight per cent by 2013, a finance ministry policy paper said.
Presently, investment from the country's tens of thousands of private entrepreneurs is less than 20 per cent of the GDP, resulting in a gaping hole in the amount of fund needed to spur growth.
The paper has identified a number of policy steps and a host of ambitious infrastructure projects to increase private investment to the required level in an effort to achieve the targetted growth.
Ministry of Finance officials said the paper has already been finalised and would be sent to the Prime Minister Sheikh Hasina soon for approval.
Ensuring energy security, enhancing efficiencies of ports and implementing large infrastructure projects are three most urgent policy steps identified by the paper to catalyse private sector investment.
"We have identified the policy steps to implement the medium term targets included in the government's Vision-2021 by 2013," a senior official told the FE.
"A strong political will can implement the targets, which are achievable if policies are fine-tuned,'' he said.
As part of the plan, a fund worth $9.5 billion was now being created for the power sector alone.
The paper has stressed creating a pool of bureaucrats to implement Public-Private Partnership (PPP) related projects and strengthen Board of Investment (BoI), now assigned to oversee the PPP-related activities.
It said budgetary allocation of Tk 25 billion, earmarked for the projects under the private-public initiative, should be utilised to create a momentum in the government's plan to invigorate the PPP.
It added the government must implement large projects like Dhaka-Chittagong access control highway, sky-train encompassing the Dhaka metropolis, Dhaka city subway and Dhaka-Narayanganj-Gazipur-Dhaka elevated expressway through private sector to boost growth.
As the issue of investment -- be it public or private -- requires direct involvement of bureaucrats, the paper recommended forming a high-powered commission to enhance expertise of public servants.
It also suggested creating a market-oriented education system to prepare future managers and executives for the booming private companies and bringing about changes in traditional institutional framework of the government.
The policy paper also called for planning development projects only after considering impacts of climate change to ensure a sustainable development.
The target to achieve eight per cent GDP growth by 2013 is included in the Medium Term Targets of Vision 2021 of the ruling Awami League (AL) party.
Reducing the present rate of poverty to 25 per cent and extreme poverty to 15 per cent are two other major targets set by the AL.