Businesspeople and economists have urged the government to take steps to spur stubbornly stagnant investment by fixing infrastructure deficits and cutting bank lending rates. Businesses and industries are not being able to do their business amid double digit interest rates, said Syed Manzur Elahi, a former president of the Metropolitan Chamber of Commerce and Industry in Dhaka.“If we can bring the banks’ lending rates down to a single digit it would help immensely,” he said.Elahi said the cost of doing business is going up in Bangladesh compared to China. “Bangladesh can’t go far on the back of cheap labour. If we can give land, gas and electricity to investors, both local and foreign, there will be no dearth of investment.”He spoke at a pre-budget discussion jointly organised by private television channel NTV and the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) at Sonargaon Hotel in Dhaka on Friday.Debapriya Bhattacharya, distinguished fellow of the Centre for Policy Dialogue, said the government is enjoying six advantages in formulating the budget for the next fiscal yeaThe advantages are: the inflation is within the central bank’s target of 6-7 percent; banks’ lending rates are on a downward trend; the exchange rates are stable; the budget deficit is within limits; the overall balance of payments is positive; and the lower prices of petroleum and fertiliser at international markets offer the scope to adjust subsidies, he said.Bhattacharya also turned his attention to the challenges the budget will face. He said the government would have to work to bolster revenue generation, disburse and attract more foreign aid and augment public investment to spur private investment.He also called for the need to implement big projects in time, as their implementation cost goes up if they are not finished timely.Bhattacharya criticised the government for not strongly using the tools under its control to spur investment.Because of the failure in administrative reforms, the allocation under the public-private partnership framework has remained unused, the economist also said.“Besides, questions about financial transparency have surfaced over the PPP projects which have been undertaken to date.”
Source: https://www.thedailystar.net/business/call-steps-boost-investment-81393
