No pressure is there on the country's foreign-exchange reserves as the loan-GDP ratio in Bangladesh is still lowest in the region, says Finance Minister AHM Mustafa Kamal. During pre-budget consultation with editors and journalists Thursday, he categorically said the annual external...
No reserves crunch, loan ratio lowest in region: KamalFE REPORT | Published: May 20, 2022 12:27:01
No pressure is there on the country's foreign-exchange reserves as the loan-GDP ratio in Bangladesh is still lowest in the region, says Finance Minister AHM Mustafa Kamal.
During pre-budget consultation with editors and journalists Thursday, he categorically said the annual external debt-servicing liabilities can be met with the remittance the country received in less than two months.
He noted that the country never failed to repay either principal amount or interest on the loans.
Explaining the debt conundrum being talked about in the wake of Lanka fiasco, he said: "Some 77 per cent of our external loan is soft loan, which is not costly, while Sri Lanka took costly commercial loans. So, don't compare us with Sri Lanka."
The finance minister rules out any debt woes in the near future either. He furnished debt-repayment statistics over the coming years, and said the country needs to repay US$ 2.4 billion this year, US$ 2.8 billion, US$3.3 billion, and US$4.0 billion in the subsequent years.
"I just got the information that we received remittance worth US$ 2.0 billion this month (for April). So, we can repay the debt with two months' remittance money," he adds.
Giving recent statistics of the FAO and the World Bank over substantial rise in prices of food globally, he said Bangladesh as a market-based economy also faced its fallout.
Speaking at the virtual meeting, editor of The Financial Express Shamsul Huq Zahid mentioned that the state-run Bangladesh Energy Regulatory Commission (BERC) suggested enhancing bulk-power tariffs by around 58 per cent without any provision of government subsidy.
The move, if approved, will further increase the prices of commodities as a spillover effect. "Is such proposed hike logical under such current situation?" he posed the question.
He also said the central bank recently increased LC margin significantly on import of high-end and luxury products in a move to lessen pressure on forex reserves, and it will impact revenue earnings.
"So, how the government will mobilise revenue required to finance the next budget that is expected to be higher than the existing one," he wondered.
Director and head of news of Channel I Shykh Seraj recommended continuation of subsidy on the agriculture sector considering the matter of food security in the context of climate change and global tensions.
He was suggesting introduction of agriculture insurance for farmers, calling upon the government to pay premium in the initial stages to motivate the growers.
Naem Nizam, editor of daily Bangladesh Pratidin, suggested cutback on the corporate tax for newspaper industry to 12 per cent as enjoyed the readymade garment (RMG) sector.
He was also recommending further cut in import duty on newsprint.
Senior journalist Nayeemul Islam Khan said the government should make a lump-sum allocation for the state-owned entities to clear pending advertisement bills to the newspapers.