Avoid contradictory actions

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BANGLADESH escaped the worst of the 2008-09 financial crisis by following its own path, even if the overarching approach should be one of global integration and gradual financial liberalisation.
We do know how banks in Bangladesh escaped the scourge of high finance. They avoided getting into deals in exotic/toxic instruments, regulations requiring greater provisioning against risky lending and stricter controls on loans to commercial real estate being in force. These were some of the factors that helped to keep financial institutions in relative safety in Bangladesh.
A syndicate of nine Bangladeshi local banks has, according to media reports, finalised a proposal to give Biman Bangladesh Airlines Ltd a loan of $114.75 million for procuring two aircraft from Boeing. This is the first time after the country's independence that local banks are giving such a big loan to a government agency in foreign currency.
While the authorities concerned deserve appreciation for the present state of affairs in the country's financial sector, we must not, however, forget that the highest appreciation is not to utter words, but to live by them. Appreciation can make a day, even change a life. Our willingness to put it into words is all that is necessary.
When our foreign exchange reserves are sound, what is the rationale behind the government approaching the World Bank and other foreign financial institutions to fund the national development programmes?
It is strange that our leaders, while agreeing, on the one hand, that the financial practices followed by Bangladesh over the last year helped it to tide over the impact of global recession do seek, on the other hand, to implement policies that are quite contradictory to their utterances.
Balaram Sengupta
Banker
e-mail: balaramsengupta@gmail.com