10 June 2024, Mon, 7:20

Jamaat's official reaction to the proposed budget

Debt-based budget will not create any positive impact for the nation

-Mia Golam Porwar

Bangladesh Jamaat-e-Islami’s Secretary General and former MP Professor Mia Golam Porwar delivered an address today expressing party’s official reaction in regards to the proposed budget for the fiscal year 2024-25. Jamaat’s central publicity secretary and party’s central executive committee member Advocate Matiur Rahman Akanda hosted the conference. Among others, Jamaat’s Assistant Secretary General Maulana Rafiqul Islam Khan, central executive committee member and Dhaka south city Ameer Nurul Islam Bulbul and central executive committee member and Dhaka north city Ameer Mohammad Selim Uddin were present on the occasion.

Secretary General’s address to the nation is as follows:

Dear countrymen,
Assalamu Alaikum Wa Rahmatullah.
As you all know that this government is not an elected authority. The incumbent government came to the power this time once again by snatching voting rights of the people away and also by holding a dummy election on last 7th January. The finance minister on last 6th June placed Tk 7,97,000 crore national budget for 2024-25 in parliament. In the proposed budget titled "Pledge towards building a happy, prosperous, developed and smart Bangladesh,” the finance minister talked about many hopes which are far away from reality. The concept of their prosperous and developed Bangladesh is totally fictitious. The people of Bangladesh are leading terrible lives due to price hike of the essentials, repeated raise of water, electricity and gas price, bank looting, share market scam and money laundering activities. Under such circumstances, our country can never be defined as a prosperous, developed and smart Bangladesh.

More taxes imposed upon the people:
In the proposed budget, all measures have been taken to impose additional taxes upon the general masses. Taxes have been imposed on the essential items related to daily lives. Tax has been imposed on mobile talk time and internet consumption, which will increase the cost of the consumers. Import taxes have been increased for the raw materials of AC and LED. So, naturally the prices of AC and TV will be on the rise and people will continue to suffer terribly.
Revenue income:

The National Board of Revenue may be given a task to raise Tk 4,95,000 crore. To do so, the concerned authority has to manage more than 66 thousand crore taka from the existing revised budget. The experts term it as a major challenge for the government. Practically, the revenue policy of the government has become totally dependent on individuals and some specific sections.

Loan and austerity-based budget will hamper investment:
The budget set a limit of 2 lakh 56 thousand crore taka as loans. It is impossible for the government to implement such a loan-based budget. It has been proposed to take loans from the banks to meet the deficiencies. In that case, investment in the private sectors will be disrupted severely and will cause a negative impact on the currency market. It may intensify the liquidity crisis as well. The economic experts viewed the budget as an austerity initiative from the part of the government. The budget has huge deficiency in the budget in comparison to GDP. It may also raise inflation as well.

Loan default:
The budget set no outline to control loan defaulters and it set no punitive measures against the loan defaulters and money launderers. According to the statistics of Bangladesh Bank, the amount of default loan up to last March was one lakh 82 thousand 925 crore taka. The actual amount is bigger than that. To check the cultures of default loans, strict initiative must be taken against the loan defaulters.

The inflation and GDP growth targets set in the proposed budget for the upcoming fiscal year 2024-25 are not realistic as the ground reality has not been assessed properly. Bringing down inflation to 6.5% and achieving a GDP growth of 6.8% is both unattainable. Moreover, the government's target to reduce inflation to 6.5 percent appears overly ambitious in light of the fact that average inflation has remained above 9 percent for two consecutive years. Most importantly, the budget does not provide any detailed roadmap on how to change that.
Options of whitening black money:

Backtracking on its promise to eliminate black money, the government has once again made room to allow both individuals and companies to whiten money without facing scrutiny and by paying a 15 percent tax, a move that drew sharp criticism from economists and civil society. According to the new provision, no authority can raise any question if a taxpayer pays tax at fixed rates for immovable properties such as flats and land and 15 percent tax on other assets, including cash, irrespective of the existing laws of the country. The scope to whiten black money will remain in place till June 2025. But economists and corruption watchdogs said that successive governments allowing the whitening of black money was akin to "licensing corruption".
Income limit:

The government has retained the tax-free income limit at Tk 3.5 lakh for individual taxpayers for fiscal year 2024-25. It should be more than 4.5 lakh, we think. The budget proposes to increase the maximum tax rate from 25 percent to 30 percent by making some changes to the number of slabs, which is also unjustified.

Education Sector:
Education is the backbone of a nation. Conspiracy is going on against the educational system of this country, where 90 percent populations are Muslim. The proposed budget also raised question about its allocation in this sector. Since FY 2021, it has been gradually decreased regularly. Although, the government is demonstrating their maximum allocation to confuse more people.

Agricultural sector:
Agriculture is the driven force of Bangladesh economy. But the proposed budget kept no allocation for the development of agriculture, its expansion and mostly for the farmers. Of the labor class, 43.89 percent are related to farming. But the budget failed to give any assurance to give them proper price of the products. There is no privileges for the farmers in the proposed budget to receive fertilizer, seeds and insecticides more conveniently.

Industrial sector:
no guidelines have been placed in the budget for the development, development and setting up of new industrial establishments. Already due to various global reasons including covid epidemic, Russia-Ukraine war and shortages of dollar, the import of industrial raw materials and machineries have decreased at a massive rate. As a result, new industries are not being established. If incentives were provided in small and medium industries, new industries would have been established and unemployment crisis would have been reduced to some extent. But no incentives for industrial development have been provided in the proposed budget.

On the one hand, the state-owned sector industries are closing one after another with the burden of losses of thousands of crores of takas. The government could not open the closed jute mills. On the other hand, the textile and apparel industry, the largest sector of export earnings, has been neglected. The proposed budget did not mention any support for the development of the textile and apparel industry. Conversely, the duty on imported men's and children's clothing has been reduced which may affect the local industry.

Medical cost will increase:
Severe anarchy is continuing in the medical sector. Earlier, medical equipment was imported with special tax exemption facilities. But the proposed budget recommends to impose raise taxes from existing one percent to 10 percent on at least 200 medical equipment. It will increase the healthcare service cost and the people will be deprived from receiving proper medical treatment. The budget also proposed to increase taxes on the imported raw materials, which will raise the industrial expense as well.

Bank management:
Banks are being looted in Bangladesh like anything. Customers have lost confidence to deposit money in the bank. There is no direction in the budget to curb the tactic of misappropriation of people's deposits by special groups in the name of taking loans from banks.

Unemployment crisis:
One of the main problems of Bangladesh are corruption and unemployment. Reducing corruption will accelerate economic growth. It will increase employment as well and only then, unemployment crisis will be decreased. Awami League came to power in 2009 and promised to provide door-to-door jobs. But during the 15-year rule of Awami League, unemployment crisis have been intense in an unprecedented way. According to Bangladesh Bureau of Statistics, the number of unemployed people in 2023 alone is 24 lakh 70 thousand. The terrible pictures of unemployment among the educated youth of Bangladesh became apparent through various media. In many countries, the government provides unemployment benefits to the unemployed until they manage any job. But this does not have such will and accordingly, there is no action for the unemployed sections in this budget.

This budget will not bring any good news for the people:
All economic indexes are going down now. The public lives are being severely hampered due to inflation. 3 years back, on average, every citizen had a loan of one lakh taka which is now one lakh and 55 thousand taka. So, in just 3 years loan has increased by 55 thousand on average. The amount of loan both in the government and the public sector in June, 2023 was 98.9 billion dollars. In last September, it became 100 billion dollars. The experts anticipate that local and foreign along with interest will be just double in the next fiscal year. The food inflation rate in Bangladesh is 11 percent now, which is more than the bankrupt country Sri Lanka. Only 5.5 percent GDP has been achieved this time which is lesser than 2006.

The finance minister in his budget announcement emphasized on keeping the macro economy stable, bringing down inflation to 6 and a half percent, curbing corruption. But an analysis of his budget speech finds no indication of optimism. There is no certainty as to where the finance minister will come from in terms of expenditure. The finance minister said borrowing from domestic and foreign sources as a source of bridging the deficit of more than Tk 2 lakh crore. The private sector will be at risk if the government borrows more money from the banks. In fact, the budget proposed by the finance minister is just a budget to impose additional taxes on the people. This budget will not bring any welfare to the country and the people.

Dear countrymen,
By analyzing the proposed budget, it is evident that this budget is not presented for the welfare of the people. This budget has been presented to give more benefit and opportunities to the government and its affiliated personalities. This government has no responsibility towards the people as it was not elected by the people. Under the circumstances, the countrymen need an elected government for the overall economic development of the country which can present a balanced budget for the welfare and well-being of the people. As long as this government is in power, it will destroy the country's economy and turn the country into a debt-based country. In order to get rid of this situation, a united movement should be launched to establish a pro-people government.

I am ending my speech by thanking everyone."