DHAKA: World Bank, in a report on Wednesday, said due to not getting expected amount of investment, less power generation in old plants, short of gas and no chance to give up the quick rentals are leading Bangladesh to increase power price.
To come out of these problems, World Bank made some recommendations, like- a policy is necessary focusing on creation of new markets for power, increase of power generation at the old plants, decrease additional pressure on the fiscal year and fixing the power price.
WB Bangladesh office lead economist Zahid Hossain revealed a report titled ‘Bangladesh Economic Update’ in a programme at its office at capital’s Agargaon area.
A six percent growth would be possible, if the power and the transport management are being improved through ensuring the political stability, according to WB.
Zahid said a decrease of trade deficits from 4.3 billon to 2.8 billon and an increase of central bank reserved from 15.3 billion to 19 billion were the positive signs of Bangladesh economy.
But, image crisis in ready-made garment sector, gas crisis, congested highways, and inadequate supply of electricity were the negative signs as well, the WB viewed.
He said: “Obstacles to business-friendly environment, caused by political instability, have been removed, which is not only important for investment, but also for the stability and environment of the future.”
“But the uncertainty has not been removed yet, because investment is a long term aspect,” he added.
Zahid said that a total of 45 days had gone wasted in this fiscal year due to hartal and strike, which is a loss to the gross domestic production.
On the 6.3 percent Gross Domestic Products (GDP) growth predication made by Finance Minister AMA Muhith, the WB lead economist said: “He is a manager of economics, he gave his opinion, and he might have logics behind it.”
“Every finance minister always makes a prediction, which does not historically match with the Bangladesh Bureau of Statistics (BBS) all the times. I think BBS works independently and predicts on the economy,” Zahid added.
Though political stability has appeared, but investment in private sector remains uncertain; in addition, the flow of remittance has been lessened, according to this WB economist.
As per the WB prediction, a 5.4 percent GDP growth would be recorded for the current fiscal year while government fixed the growth at 7.2 percent.
On April 1, Asian Development Bank predicted 5.6 percent GDP growth citing political instability and decrease in the remittance flow as the reasons for low growth.
Current fiscal yr of BD
WB forecasts 5.4% GDP growth
BDST: 1645 HRS APR 09, 2014
