Experts recommend focusing on health sector for economic recovery
In the upcoming budget for the 2021-22 fiscal year, the creation of employment opportunities and reducing poverty amid the pandemic will be the biggest challenge for Bangladesh, according to experts and economists.
They told Bangla Tribune that many people have lost their jobs due to Covid-19 and poverty is also on the rise.
To recover from this, they suggested that Bangladesh arrange employment opportunities quickly — not only in the country but also through the export of manpower abroad.
The unemployment rate of Bangladesh stands at a little less than 4.2%, according to data by the World Economic Forum (WEF).
A recent study by the CPD found 61.57% people had lost jobs in March and April last year due to the adverse economic impact of the Covid-19 lockdown.
The study also revealed that only 15% could avail a job the following month, while 85% remained unemployed for a longer period.
Immediate assistance for the unemployed is a big task, said Professor Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue (CPD).
“Tk12,000 crore is going to enter the economy through the whitening of black money. But the decision should be made by calculating the amount of revenue loss due to this discouragement,” he added.
Bangladesh Institute of Development Studies (BIDS) researcher Dr Nazneen Ahmed said the next fiscal year will be a challenging one as the government will have to reduce the coronavirus’s impacts as much as possible and return the economy to the old pace of development.
“That is why the allocation for the health sector has to be increased in the new budget,” she added.
Nazneen also pointed out that the allocation for the social security sector should be increased in the budget.
In this case, it is necessary to allocate money for food aid as well as cash assistance, she further said.
Dr Ahsan H Mansur, executive director of the Policy Research Institute, said: “The coronavirus vaccine should be given importance in the budget. To this end, an additional Tk15,000 crore allocation should be made in the budget.”
As long as there are no opportunities, at least there must be an effort in the budget to provide food for the unemployed, he added.
“At the same time, it is a big challenge to continue funding the ongoing activities of the government, especially mega-projects,” he said.
The finance minister will present the budget for FY22 to the parliament on June 3. This is the third budget of AHM Mustafa Kamal as the finance minister.
The next budget of the government will be dedicated to the poor, he said last month.
According to government sources involved with the process, the budget is being prepared giving rational importance to GDP and significance to employment.
The government is also focusing on more incentives for industries to ensure employment.
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But policymakers think that there are many hitches to be faced in raising revenue as per the target for the next financial year.
According to sources at the Ministry of Finance, there is a special fund of Tk10,000 crore to deal with Covid-19 this time, which is about 30% more than the allocation for the budget of the 2020-21 fiscal year.
The size of the social security program is expected to increase in this year's budget as well to Tk125,000 crore.
The potential size of the budget for the new fiscal year, which is being designed to address the coronavirus pandemic, could be about Tk602,880 crore. As always, the proposed deficit in the budget for the new fiscal year will be Tk213,802 crore.