Right course for the economy to take

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Rising inequality between rich and poor is a global phenomenon and the recent economic crisis has worsened it further. The USA has the highest inequality rate in the world and it is increasing tremendously in China now. In recent years, the disparity widened in Bangladesh also .The astronomical price hike of land, systematic default of bank loans and massive tax evasion are widening the rich-poor gap in Bangladesh. These are good enough to aggravate inequality.
The finance ministry has, recently, formed a banking and finance division to oversee the activities in the finanancial sector.It is to be noted that banks are dominating the total financial sector in Bangladesh. State-owned commercial banks have about 40 percent stake of the banking industry's assets, advances and deposits, consequently the lion's shares are of private banks.
As per existing rules of Bangladesh Bank a director of Private Commercial Bank (PCB) cannot borrow fund from the bank wherein he/she is a member of board of directors. Complying with this rule many directors of PCBs are borrowing huge fund from other PCBs without collateral security, influencing the concerned board of directors for their mutual benefits. Apart from this, a sizable number of private banks' directors are politically leaning towards the government. Eventually, the Bangladesh Bank's supervision power is getting diluted.
Bangladesh economy is export dependent and it might cause instability, particularly during the time of the current global shocks.It is imperative, going for specialisation and diversification of exports. The Bangladesh Bank has to be cautious about capital flow although the country remained immune to the recent global crisis.
Economists suggest, ensuring independence of the central bank is vital for a stable financial market. There is no future without a vigorous research on the economy of Bangladesh and plan of action. Think-tanks of Bangladesh may come up with their effective research study and recommendations on next course of action for Bangladesh's sound economy.
The bottom line is: for better financial market in Bangladesh, especially during the worldwide financial crisis, autonomy of the central bank, research on economy, export diversification, guarding against tax evasion, safety net measures for minimizing inequality between rich and poor, are needed very badly.

Ibnat Islam Etu &
Ibsan Islam Edi
Kalabagan, Dhaka-1205.
E-mail: saiful_ibsan@yahoo