Hossain Zillur Rahman is an economist and a former adviser to the caretaker government. Now the chairman of Power and Participation Research Centre (PPRC), he spoke to Prothom Alo on the budget for the fiscal 2019-20.
Prothom Alo: Do you see any difference between the budget unveiled by the present finance minister AHM Mustafa Kamal and the ones proposed by former finance minister Abul Maal Abdul Muhith?
Hossain Zillur Rahman: It is a budget of continuity, with little difference. If we see the budget as an economic philosophy, and not only as income and expenditure, we would notice that exaggeration has been the norm since the days of former finance minister Muhith.
Budget means big talks, undertaking big projects and showing big statistics. At the end of the year, it gets downsized due to non-implementation. So the budget plan is kind of unrealistic. Despite this, the budget deficit was limited to five per cent in the past decade. The poor are mostly affected when the budget is downsized while the influential get benefited. As a result, the strategic plan of economy is damaged. If we consider the context of the budget of the fiscal 2019-20, there is an important change. Earlier, the economic management team of the government was comprised of bureaucrats and politicians. This time, the finance minister, the commerce minister, the state minister for energy, the textile and jute minister and the prime minister’s private sector affairs adviser are from the business background. It was expected that a pragmatic budget would be proposed because they would realize what is containing investment. But in reality, they are stuck by old spirit.
Prothom Alo: What are the prospects and problems if businessmen become ministers?
Hossain Zillur Rahman: It was perceived that at least we would get a pragmatic budget if businessmen become ministers as they would adopt pragmatic strategies. But that did not happen. Government organisation BIDA said the expenditure for trade and commerce will increase further due to the budget. As a result, the investors would be discouraged.
Prothom Alo: Many say the budget of this year has been pro-businessmen instead of pro-business.
Hossain Zillur Rahman: But the budget could not facilitate all businessmen. It has facilitated a section of businessmen. Had the budget facilitated all businessmen, it would have been a pro-business budget. It has been a budget for a vested quarter. It has not been investment-friendly. So the risk of investment remains.
Prothom Alo: Do you want to say that this budget will not accelerate the economy?
Hossain Zillur Rahman: In perspective of our desire, the acceleration of economy has to be judged. It is no more a desire that the people of the country will not starve. We have passed that stage. Now our expectation is to become a middle income country. There are no guidelines in the budget to face challenges.
Prothom Alo: What are these challenges?
Hossain Zillur Rahman: The capacity to spend money is the first challenge. We are undertaking big projects. But we don’t see big impact on society and economy due to wastage, corruption and procrastination. Billions have been invested in the communication sector. But it cannot be said the communication system has improved a lot. Additional money is being allocated due to incapacity of expenditure.
The second challenge is that we could not create skilled human resource. We are stuck in a philosophy of education, which is called low quality universal education. This education is unable to generate skilled human resource. As a result, thousands of educated youths are unemployed. Our education budget should be divided into two. These are: allocation for infrastructure and allocation for the improvement of quality. Coming out of the low quality universal education, we have to concentrate on timely and quality education. The finance minister has announced that he would hire teachers from abroad. But we don’t see any programme to create qualified teachers in the country.
Prothom Alo: How do you view the allocation in the education sector?
Hossain Zillur Rahman: A demand for education has been created in the society. Poor people also want to give their children education. But nobody cares whether they are receiving quality education. The allocation for the education sector has increased due to inclusion of MPO. Besides, technology has been added to the education. It is a bureaucratic trick. According to research, the quality of education at primary and secondary level has fallen. We expected that there will be a separate allocation to ensure quality education. There is a huge shortage of skilled human resource. A large number of foreigners are entering our labour market. The investors say the local people cannot meet the requirements. There is no plan to create skilled manpower in the budget like in the past. I think the secondary education is very important. Many enter job market from the secondary level. MPO system should be reviewed.
Prothom Alo: Why investment is not increasing despite the growth of GDP?
Hossain Zillur Rahman: Our big challenge is to increase investment. Currently the political environment is peaceful, indomitable government. There is no opposition and there is no anarchy on the road. Still investment is stagnant. The solution will not come through the investment by the government. The genuine investment does not increase if Tk 1,000 is spent in the project of Tk 100. The business process has to be made easier. We have been hearing about one stop service for long. But in reality, that is too many stops.
Who are the main drivers of our 6-7 per cent GDP? Expatriates and RMG are playing role for 30 years. New drivers have to be created to become a middle income country. That is possible only to analyse the reality properly and take proper plans. That sort of plans is missing in the budget. The income from the expatriates and RMG may come down after 10-15 years. We are neglecting the agriculture and considering agriculture as a means of food security. But due to geographical location, the agriculture may be a new driver of our economy. Unfortunately we have no strategic outlook towards the agriculture. The farmers did not get due price by producing records amount of paddy this year.
Another challenge is discrimination. Bangladesh is progressing economically. A small group of people are being benefited of it. The large group of people is deprived. This discrimination is seen between rich and poor, village and towns and Dhaka and rest of the country. It is necessary to find out the cause of discrimination. Most of the allocation of the budget is spent in big cities, especially Dhaka. The local government is assigned to obtain SDG but the allocation is much lesser for it. Primary healthcare, public transport, housing for low income group and skill development are getting priority in the allocation for town.
We do not want higher allocation for any sector, but we want coordinated allocation. We want strategic development philosophy, which will take Bangladesh ahead. If we cannot face these challenges, we won’t be able to achieve anything big.
Prothom Alo: I saw in the newspaper that 30 per cent youths are not involved in work, not in training.
Hossain Zillur Rahman: The youths are in such situation not like that they are idle. They want to do something but they are not getting the scope. The progress of Bangladesh has to be judged as to how far we have progressed in comparison to our competitors. How far our neighbor and other countries have progressed. We are failing in the competition with our competitors. 30 per cent youths are not getting jobs but their issue is not in our policy. It is the responsibility of the government to encourage investment and to create environment. We wanted a credible economic philosophy so that the challenges can be tackled. But that philosophy is missing in the budget.
Prothom Alo: Many say the budge of this year will create pressure on the middle and low income group. The higher income group will be benefited.
Hossain Zillur Rahman: The discrimination is also behind it. The indirect tax is more than the direct tax. The middle income, low income and poor people have to bear the burden of indirect tax. General investors are the force of the banking sector. But a vested quarter is getting loan.
Prothom Alo: How do you view the allocation for the health sector?
Hossain Zillur Rahman: Everyone wants affluent and improved life. The health sector is very important. If you are healthy and strong, you can work hard. Strategic importance has to be prioritized in the health sector. And that is not only the responsibility of the finance ministry, the health ministry has to shoulder the responsibility to determine their necessity. The infrastructural change of the health ministry is necessary. We have massive infrastructure in the health sector, but that remains unutilized. There are no necessary physicians and nurses in many hospitals. What is the benefit of these infrastructures? We have to concentrate on both infrastructure and manpower as well. There are hospitals at upazila level but no manpower. There is electricity in the village. But public hospitals remain closed after 2pm. It is one kind of wastage.
Prothom Alo: Allocation has been increased in different sectors than the last year, but the allocation for the CHT region and religious minorities has fallen.
Hossain Zillur Rahman: I have not seen the estimation. If there are such inconsistencies, that should be removed. There is discrimination too here. We have to go forward with all.
Prothom Alo: You are talking about the financial discipline or the rule of law. But the question of democratisation is also related to it. Is it possible to establish rule of law in absence of democracy?
Hossain Zillur Rahman: The issue of rule of law is important. There must be accountability to increase skill. There are two sides of good governance. One is objective and another is media. The objective is democratisation. But I highly value the media to tackle the challenges. How will the quality of education be ensured if the head teacher is humiliated by cadres of the students’ organisation? The deficiency of rule of law is hampering our pace of development. The civil society or the opposition parties are talking about the democracy or the rule of law, but they are not talking about the media. The absence of accountability creates deficiency of good governance, which is a threat to the development and investment.
Prothom Alo: Thank you.
Hossain Zillur Rahman: Thank you too.
*Sohrab Hassan is a joint editor at Prothom Alo. This interview, originally published in Prothom Alo print edition, has been rewritten in English by Rabiul Islam.