HC asks govt to explain PSI agreement with IMF
Tuesday, 18 September 2007
The High Court (HC) Monday directed the government to explain in two weeks why it should not be stopped from pursuing a Policy Support Instrument (PSI) agreement with the International Monetary Fund (IMF), reports bdnews24.com.
The court order came after Supreme Court (SC) lawyer Mesbahul Islam filed public interest litigation with Justices Nazmun Ara Sultana and Md Abu Tarique, challenging the government's proposed adoption of the PSI deal with the lending agency.
A PSI deal is feared to subject Bangladesh to intrusive policy advice without any financial assistance from the donor.
The petitioner had earlier urged the HC to direct the government to cease negotiations with the IMF over the probable agreement.
Abdul Wadud Khandaker, counsel for the petitioner, told the news agency Sunday that the previous BNP administration had rejected pressure to adopt the proposal by the IMF and World Bank.
"However, the caretaker government has now partially accepted the IMF-World Bank prescription. It has increased the prices of fuel, which has resulted in price hike in all essential commodities.
"This has badly affected industrial production. The government has withdrawn fertiliser subsidies at the IMF's insistence. This is suicidal as agriculture is the backbone of our country.
"The government is currently negotiating the PSI agreement with the IMF. This prescription has been widely criticised by economists in the country. Even the economic adviser to the caretaker government criticised it on September 14," Khandaker said.
The court order came after Supreme Court (SC) lawyer Mesbahul Islam filed public interest litigation with Justices Nazmun Ara Sultana and Md Abu Tarique, challenging the government's proposed adoption of the PSI deal with the lending agency.
A PSI deal is feared to subject Bangladesh to intrusive policy advice without any financial assistance from the donor.
The petitioner had earlier urged the HC to direct the government to cease negotiations with the IMF over the probable agreement.
Abdul Wadud Khandaker, counsel for the petitioner, told the news agency Sunday that the previous BNP administration had rejected pressure to adopt the proposal by the IMF and World Bank.
"However, the caretaker government has now partially accepted the IMF-World Bank prescription. It has increased the prices of fuel, which has resulted in price hike in all essential commodities.
"This has badly affected industrial production. The government has withdrawn fertiliser subsidies at the IMF's insistence. This is suicidal as agriculture is the backbone of our country.
"The government is currently negotiating the PSI agreement with the IMF. This prescription has been widely criticised by economists in the country. Even the economic adviser to the caretaker government criticised it on September 14," Khandaker said.