Rejaul Karim Byron

Economists yesterday stressed on addressing the persistently high inflation, macroeconomic stability and low revenue base in the pre-budget session for the upcoming fiscal year with the finance minister.

Three issues would be dictating the upcoming fiscal year’s budget, the last of the Awami League government’s present five-year term: the International Monetary Fund’s conditions, the persistently high inflation and next year’s national election.

The government’s expenses on interest payments rose more than 22 per cent to Tk 40,792 crore in the first six months of the current fiscal year owing largely to higher expenditures on treasury bills, official figures showed.  

Russia has proposed a direct payment system bypassing the global standard SWIFT to settle the dues for Rooppur nuclear power plant as the Soviet nation looks to navigate the sanctions from the West following the Ukraine war.

The government yesterday rolled back most of the austerity measures it imposed at the beginning of the fiscal year to better weather the economic upheaval although statistics indicate there has hardly been any improvement on the front.

The government has prepared a draft law for ensuring transparency and accountability in public sector purchases while also improving efficiency in the sector.

The overall cost for transmitting electricity from the Adani power plant in Godda, Jharkhand is set to increase further as two projects meant for that end are eyeing cost and time revisions.

Implementation of eight fast-track projects under the Annual Development Programme (ADP) was at a good pace in the first seven months of the current fiscal year of 2022-23 while that of other projects was slower.

Bangladesh’s dollar crisis is just not subsiding even though imports have dropped off and both exports and remittance are staging a rally.

The government can expect budget support of $500 million at best from the World Bank this fiscal year after it failed to implement key reforms that would have unlocked the entire $1 billion it was seeking.

Bangladesh and India are in talks about doing away with the dollar as the official currency for payments between the two countries -- a development that would bring down the cost of trade as well as the conversion rate losses for businesses and ordinary people.

The government has officially abandoned the austerity stance it took on at the beginning of the fiscal year as it deems the economy is nearing good health.

Major global rating agency Moody’s yesterday downgraded its outlook of Bangladesh’s banking system from stable to negative -- a crushing development that is set to make foreign transactions trickier and costlier for businesses and banks.

The first seven months of the current fiscal year of 2022-23 saw the lowest implementation rate of the annual development programme (ADP) in the last three years, with only 28.16 per cent of the total outlay being spent till January. 

Health and education are set to get the biggest chop in the revised development budget for this fiscal year, when the International Monetary Fund has stipulated more spending in the two sectors as part of its $4.7 billion loan programme.

Private power plants that use furnace oil risk facing severe shortage of fuel and this may result in power cuts during the hottest months of this year.

Bangladesh could explore health financing reforms that increase public financing for the health sector to reduce out-of-pocket spending, which is threatening to undermine national poverty reduction efforts, said the World Bank in a recent study.

Bangladesh’s economic crisis will not go away if the government does not strictly adhere to the conditions tagged with the International Monetary Fund’s 42-month loan programme, said the lender’s top official.

Weak banks in Bangladesh with small holdings of government securities, which are used to mobilise funds either from the central bank or peers, may become more vulnerable in the days to come, Moody’s Investors Service warned yesterday.  

Bangladesh’s preparation for LDC graduation would start in earnest with the International Monetary Fund’s 42-month loan programme, where one of the objectives is to overhaul the monetary and exchange rate policies to meet the needs of an open economy.