State of the economy

Two politically volatile months have passed since then with more uncertainty in prospect for the last two months of the current fiscal. That is why a timely warning has been issued to politicians to exercise restraint and let the economy off the political hooks.

The pre-Bangladesh Development Forum (BDF) meeting in Dhaka having got underway on Tuesday, one would have thought the Bangladesh central bank's assessment came in handy for it. Also perhaps the call for better politics and law and order.

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The political atmosphere has become highly torrid. It is rife with verbal abuses and incendiary threats being traded between the ruling party and the opposition. In the face of a growing sign of destabilisation, it is felt on all hands that the interest of the economy will have to be asserted. That's why it is important to know where our economy stood so that we get a feel of where our stakes truly lay.

During the first eight months of the current fiscal, exports notched a 14 percent growth compared to last year's 7 percent; and imports of raw materials, intermediate goods and capital machinery registered a significant rise. Concomitantly, industrial output grew by 7.2 percent. Significantly, industrial term loans increased by 76 percent from the previous level.

Total foodgrains output for FY 2004 is projected to be 281.01 lakh MT, representing a 5.3 percent increase over 166.95 lakh MT recorded in the previous year.

Good agricultural and industrial growth prospects together with strong foreign trade performances are likely to benefit the service sector.

Foreign exchange reserve is high and external payments position has improved. But internally, the total revenue collection lagged by Tk 582 crore against the target of Tk 18,735 crore.

The ADP has been implemented up to 40 percent over the last three quarters. It is little consolation that the figure was 36 percent during the corresponding period of the last fiscal.

The economy could even grow beyond the projected 5.5 percent, by Bangladesh Bank's reckoning, if other things remained the same, as is customarily stated in economic parlance. Should we allow non-economic factors to tyrannise the economy? That puts a premium on political parties pulling themselves from the brink of what looks like an imminent political and economic disaster.