ICC,B underlines political stability for higher growth

DHAKA, JULY 13 (BSS) - The International Chamber of Commerce, Bangladesh (ICC,B) underlined political stability as precondition to achieve higher and sustainable growth as targeted in the national budget for the financial year (FY) 2011-12.

The Bangladesh chapter of the international trade body made this editorial comment in its July issue of 'New Bulletin', released today.

The ICC,B observed that the 7 percent growth target is higher, but achievable provided with ensuring political stability and coordinated effort of both public and private sector.

"Even though experts have warned that the ambitious growth target will be difficult to attain, the businesses feel that against a 6.7 percent growth in FY11 (2010-11), the growth target [for the current 2011-12] is achievable with political stability and all out efforts by both public and private sectors," the ICC,B said.

It also suggested ensuring timely and efficient implementation of projects, designed cautiously to expedite the growth prospect and keeping the project selection process out of the political influence.

Referring to the increased revenue collection in the immediate past 2010-11 financial year, the ICC,B said the government would also meet much of its deficit financing by consolidating efforts in increasing revenue collections and by settling huge long outstanding tax and custom cases instead of borrowing from commercial banks.

It recommended steady implementation of the annual development programmes (ADP) from the very beginning of the fiscal year to avoid hasty move to complete many projects in the last quarter, which often cost quality of the projects.

"Besides, in every third quarter of a financial year, the ADP is invariably downsized due to poor project selection and rate of execution," the ICC,B said.

Suggesting speedy disbursement of fund, it said the finance ministry could release at least 25 percent of the total allocation within the first quarter of the financial year and the balance could be given in phases with the progress of the projects.

"It is the high time that the budget preparation mechanism should be revisited and steps initiated forthwith for the selection of projects for inclusion in the next ADP and lining up of necessary funds from the development partners," it observed.

The global trade body also suggested political parties take a
four-year perspective plan in the first year of forming government so they can implement their development plan during five-year tenure.

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