In addition to giving priority to the priority sector, the CPD also recommended the formation of a commission on agricultural commodity prices, a bank commission and a task force to implement incentives.
The Center for Policy Dialogue (CPD), a non-governmental research organization, has suggested budgeting for the next 2021-22 fiscal, giving priority to four sectors: health, social security, agriculture and small and medium enterprises. The company is also in favor of ‘expanding’ the next budget.
The CPD said that since government debt is still about 35 per cent of gross domestic product (GDP), expansionary budgets can be made. Economists generally consider the debt-to-GDP ratio to be as safe as 40 percent.
The CPD said this while conducting an independent review of the country’s economy on Monday ahead of the budget for the next 2021-22 financial year. CPD Special Fellow Mostafizur Rahman, Research Director Khandaker Golam Moazzem spoke on the occasion. Taufiqul Islam Khan, Senior Research Fellow of the company, highlighted the overall aspects of the economy under the direction of Fahmida Khatun, Executive Director of the company.
Recommending steps to be taken to stop tax evasion and money laundering without imposing new taxes for the next financial year, the CPD said policy planning should come out of the GDP growth concerns. And it is now imperative to form a task force with all parties involved in implementing the incentives. The CPD also recommends an intermediate plan to address the economic challenges posed by the epidemic and eliminate inequality.
Highlighting the need for a price commission in the agricultural sector, the CPD said, “If it exists, farmers will be able to sell their produce directly and get a fair price.” There are such commissions in India.
CPD’s long-standing recommendation to commission a bank. The company has made that recommendation again with the next budget in mind. They said the government has backtracked on commissioning banks even with the initiative. But it is needed. What is seen as a picture of a defaulting debt cannot be called transparent.
CPD Special Fellow Mostafizur Rahman said, “Our budget is 16 to 18 percent of GDP.” But government spending is 22 percent in Pakistan, 26 percent in India, 26 percent in Afghanistan, 32 percent in Bhutan and 31 percent in the Maldives. As such, our government expenditure is low.
CPD executive director Fahmida Khatun said the social security sector accounts for 3 per cent of GDP. This includes pensions and interest subsidies on savings certificates. In reality, the actual allocation for the poor will be one and a half percent.
Khandaker Golam Moazzem, CPD’s research director on commodity price commissions, said it was needed. It is unfortunate that there is a tendency in the government to sidestep any issue of reform.