Proper policies and support for the private sector

AK Mazhar Ali Economic growth is the main expectation and need in the economic realm of Bangladesh. But this growth is also largely desired in the private sector. This is for the simple universal realisation now about the smaller the role of the government in the economy. The pursuit of this objective will help achieve limiting wastage and profligacy of public resources that usually accompany governmental involvement in the economy. It ought to be every economist's goal that the efficient use of scarce resources is ensured. Following this principle, Bangladesh has been striving to achieve private sector-led economic growth. This has led to the transformation of its economy remarkably. The state sector has considerably shrunk and the economy has added substantial sinews to it and diversified under the private sector. Nonetheless, it is acutely felt by private sector entrepreneurs in different fields that they could achieve a great deal more, if only they were better supported by official policies and existing facilities. Properly aiding the private sector merits here a priority attention of the authorities concerned. The prescriptions for attaining faster private sector-led growth are largely known to all concerned. In this context, the government needs to be serious enough about addressing the problems which impede the process for efficient operations of the private sector. One may note here the case of ensuring adequate poor power supply which is one of the nagging infrastructure constraints to private sector development. Power is the life-blood of any economy. It is the basic requirement for industries or the running of services. But the gap between the demand for power and its availability has been widening in the country with negative consequences for the latter. Many industrial investments are on stream but these could hit snags after going into operation if new generation capacities are not added to the power sector. The rate of new industrial investments would surely increase faster if cost-effective power supplies are ensured to the businesses. In this context, it is imperative on the part of the government to engage in very urgent execution of existing large scale plans to create substantial additional capacities for power generation at the fastest. All government-sponsored plans to this end must be hurried towards completion. The availability of the other main source of energy, natural gas, must also increase. Gas supply to existing industrial areas needs to improve much; extension of gas supply to areas of the country not covered by such a network will help the private sector to rapidly industrialise those areas. There are also other infrastructural bottlenecks of significance such as roads, telecommunications, etc. The expansion of such infrastructure-related facilities in greater number can be supportive of private investments. Expansion of ports, their modernisation and improvement of their handling capacities are, thus, urgently called for. These works are on progress but quicker progress will motivate the investors or entrepreneurs. Private initiative is encouraged when government policies are seen as favourable over the long term. Continuity and stability of fiscal policies, rational lending rate structure, tariff structures that favour domestic products over their rival producers, lowered rate of corporate taxes and other incentives in areas of fiscal and monetary policies will go a long way towards assuring potential investors about a better longer term assessment of business opportunities and viability of enterprises, both new and potential ones. All such measures will ensure appropriate incentives for growth and flourishment of entrepreneurship. Thus, it needs to be the priority goal of the government to create and sustain a policy environment that can truly keep the private sector interested and going in the path of entrepreneurship.