The need of the hour is a strong and effective BoI
Wednesday, 28 April 2010
Jahangir Bin Alam
The government has recently decided to assign the Finance Division of the Ministry of Finance, instead of the Board of Investment (BoI), with the task of overseeing the public-private partnership (PPP) projects, according to a report of the Financial Express in its April 25 issue. The decision has been taken on a plea that BoI lacks capacity to handle the task.
According to another recent newspaper report, the government is contemplating to curtail certain authorities of the Bangladesh Telecom Regulatory Authority (BTRC) and place those with the relevant ministry. One fails to understand the actual reasons behind such decisions when the avowed policy of the incumbent government is to decentralise authorities for faster project implementation and proper monitoring.
These are ominous signs. Instead of taking necessary measures for capacity building and strengthening the BoI, the government apparently thinks that the Finance Division is well placed to carry out the task. If it is so, why not do away with the BoI? Moreover, one fails to understand how does the Finance Division fits in to undertake such a task which is beyond its purview.
Under these circumstances, one may feel that the government is backtracking on its commitment to undertake decentralisation of the administration and gradually becoming dependent on the bureaucrats sitting in the secretariat.
The Board of Investment (BoI) was established in 1989 through an Act of Parliament with a view to promoting and facilitating private investment, both domestic and foreign, in the country. But, the irony is that since its inception, the BoI was never allowed to function effectively by the successive governments. This reflects lack of sincerity on the part of the governments.
Hence, the need of the hour is to have a strong and effective BoI by enhancing its capacity through placement of experienced, technically sound and commercially oriented personnel at its various tiers in order to run the organisation professionally for faster project implementation and monitoring. If right people are not available within the government structure, then the government could consider recruitment of people from outside the government for the purpose.
For attracting right people, special compensation packages, not the ones currently applicable for government employees, should be offered and adequate job security ensured. This will discourage rent-seeking tendencies.
Currently, the visible activities of the BoI are restricted to project registration and issuance of work permits for expatriate employees. Providing assistance to the entrepreneurs in getting necessary logistics support like land acquisition, gas, power and water connections are the main tasks of the organisation. But, the organisation has no authority to do so except pursuing the matters with the relevant agencies of the government which provide the utility services. It may be noted here that, the agencies providing utility services have placed some of their mid-level officials at the disposal of the BoI on deputation without having any sanctioning authority. Then what is the use of having them there?
In view of the above, it is imperative to review the BoI Act at the earliest to empower the organisation to perform its assigned functions properly and to cater speedily to the needs of entrepreneurs. Traditional bureaucracy has obviously no place in an ideal set-up of the BoI. It must be equipped with latest technology and proper economic data base to enable it to extend necessary services to its clients.
An ideal BoI should be an independent body with proper authority to take all investment-related decisions without any let or hindrance from any quarter and it must have teeth to bite when needed. Otherwise, it will continue to remain a lame duck organisation.
Further, in order to maintain continuity in the decision making process, the Chief Executive Officer i.e. the Executive Chairman of the organization, once appointed should be allowed to be in office for five years at the minimum and the decisions taken by the body with regard to providing logistics support and utility services to the investors must be made binding on the relevant agencies of the government. An ideal set-up should also have a very efficient counselling wing to guide the prospective investors in taking right business decisions.
(The writer is the Secretary,
India-Bangladesh Chamber of Commerce & Industry and a
former Secretary, Foreign Investors' Chamber of Commerce & Industry. He can be reached at: e-mail:
jbalam44@yahoo.com & jbalam44@hotmail.com)
The government has recently decided to assign the Finance Division of the Ministry of Finance, instead of the Board of Investment (BoI), with the task of overseeing the public-private partnership (PPP) projects, according to a report of the Financial Express in its April 25 issue. The decision has been taken on a plea that BoI lacks capacity to handle the task.
According to another recent newspaper report, the government is contemplating to curtail certain authorities of the Bangladesh Telecom Regulatory Authority (BTRC) and place those with the relevant ministry. One fails to understand the actual reasons behind such decisions when the avowed policy of the incumbent government is to decentralise authorities for faster project implementation and proper monitoring.
These are ominous signs. Instead of taking necessary measures for capacity building and strengthening the BoI, the government apparently thinks that the Finance Division is well placed to carry out the task. If it is so, why not do away with the BoI? Moreover, one fails to understand how does the Finance Division fits in to undertake such a task which is beyond its purview.
Under these circumstances, one may feel that the government is backtracking on its commitment to undertake decentralisation of the administration and gradually becoming dependent on the bureaucrats sitting in the secretariat.
The Board of Investment (BoI) was established in 1989 through an Act of Parliament with a view to promoting and facilitating private investment, both domestic and foreign, in the country. But, the irony is that since its inception, the BoI was never allowed to function effectively by the successive governments. This reflects lack of sincerity on the part of the governments.
Hence, the need of the hour is to have a strong and effective BoI by enhancing its capacity through placement of experienced, technically sound and commercially oriented personnel at its various tiers in order to run the organisation professionally for faster project implementation and monitoring. If right people are not available within the government structure, then the government could consider recruitment of people from outside the government for the purpose.
For attracting right people, special compensation packages, not the ones currently applicable for government employees, should be offered and adequate job security ensured. This will discourage rent-seeking tendencies.
Currently, the visible activities of the BoI are restricted to project registration and issuance of work permits for expatriate employees. Providing assistance to the entrepreneurs in getting necessary logistics support like land acquisition, gas, power and water connections are the main tasks of the organisation. But, the organisation has no authority to do so except pursuing the matters with the relevant agencies of the government which provide the utility services. It may be noted here that, the agencies providing utility services have placed some of their mid-level officials at the disposal of the BoI on deputation without having any sanctioning authority. Then what is the use of having them there?
In view of the above, it is imperative to review the BoI Act at the earliest to empower the organisation to perform its assigned functions properly and to cater speedily to the needs of entrepreneurs. Traditional bureaucracy has obviously no place in an ideal set-up of the BoI. It must be equipped with latest technology and proper economic data base to enable it to extend necessary services to its clients.
An ideal BoI should be an independent body with proper authority to take all investment-related decisions without any let or hindrance from any quarter and it must have teeth to bite when needed. Otherwise, it will continue to remain a lame duck organisation.
Further, in order to maintain continuity in the decision making process, the Chief Executive Officer i.e. the Executive Chairman of the organization, once appointed should be allowed to be in office for five years at the minimum and the decisions taken by the body with regard to providing logistics support and utility services to the investors must be made binding on the relevant agencies of the government. An ideal set-up should also have a very efficient counselling wing to guide the prospective investors in taking right business decisions.
(The writer is the Secretary,
India-Bangladesh Chamber of Commerce & Industry and a
former Secretary, Foreign Investors' Chamber of Commerce & Industry. He can be reached at: e-mail:
jbalam44@yahoo.com & jbalam44@hotmail.com)