Infrastructure deficits and gas and power supply problems are undermining the performance of all the productive sectors of the economy, said the Metropolitan Chamber of Commerce and Industry on Monday. Frequency of power outages across the country has been on the rise in recent weeks despite a substantial increase in the country’s overall electricity generation, said the MCCI. ‘Businesses are bearing the brunt of frequent load shedding as industrial output is being hampered, while residents are suffering from scorching heat during the fag end of the monsoon,’ said the MCCI in its economic review for July-September period. The MCCI, however, hopes that because of some recent deals with China and some distribution facility updating by the government the problem in the power sector would be resolved. ‘The government should adopt adequate steps to overcome these problems, and achieve and preserve political stability, which are essential for creating an investment-friendly climate, so crucial to achieve higher economic growth,’ it said. The MCCI said remittance inflow in the first quarter of the current fiscal year 2016-17 dropped by 17.82 per cent to $3.23 billion compared to $3.93 billion in the corresponding quarter of the previous fiscal year. ‘The drop in remittances was due to the decline in the income and savings of Bangladeshi expatriates living in the Middle-Eastern countries due to the persistently uncertain political situation in the Middle East,’ it said. The implementation of the Annual Development Programme failed to pick pace in the quarter under review, although the government took a number of initiatives to accelerate ADP implementation, said the MCCI review. ‘The implementation rate in July-September of the FY17 was just 8.75 per cent mainly due to the failure of large ministries and divisions. The low implementation rate can also be attributed to the poor implementing capacity of the agencies concerned. Implementation rate was 6.74 per cent in the corresponding period of the previous fiscal,’ it said. The MCCI said although the net foreign direct investment increased in the quarter under review, industry insiders consider it insufficient. In July-September of the FY17 the FDI increased by 9.30 per cent to $435 million from $398 million in the corresponding period of the FY16. ‘Industry insiders consider this amount of FDI quite insufficient to meet the country’s development needs. Bangladesh’s low labour costs and efficient supply chain, especially in readymade garments industry, appear generally attractive to foreign investors, but of late they have adopted a “go-slow” strategy in making fresh investments,’ said the MCCI. ‘They consider the underdeveloped infrastructure, shortage of power and energy, lack of consistency in policy, procedural bottlenecks, weak regulatory framework, scarcity of industrial lands, lack of proper coordination among government agencies, and political uncertainty as major impediments to new investment,’ it also added.
