The
Federation of Bangladesh Chamber of Commerce and Industry (FBCCI) said
private sector credit will be affected if the government takes the
targeted loan in the proposed budget from the banking sector.
FBCCI
President Mahbubul Alam said this while speaking at a post-budget press
conference at the federation building in Motijheel on Saturday. The
proposed budget has fixed the government bank borrowing target at Tk1.37
lakh crore.
Excessive borrowing by the government from the
banking system hinders the flow of credit to the private sector, with
the governments needs crowding out, in economics language, the private
sector players. When governments borrow, they compete with everybody
else in the economy who wants to borrow the limited amount of savings
available.
"As a result, we fear that there may be an adverse
impact on investment and employment," Mahbubul said. The FBCCI president
said, "The government has adopted a zero-tolerance policy against
corruption. We welcome this initiative. It is very important to maintain
the quality of the work undertaken under the annual development program
and to complete the work efficiently and on time." Apart from this,
efficiency should be taken into account in undertaking projects, so that
the development becomes sustainable, he said.
Mahbubul said, "We
have given several proposals related to revenue for the budget for the
consideration of the government. Several cases were considered but in
some cases the reflection of the proposal was not observed."
The
FBCCI president said that the withholding tax on rice, wheat, potato,
onion, garlic, beans, edible oil, sugar, and nuts has been reduced from 2
percent to 1 percent, which will help control inflation.
"IT
sector tax exemption extended. This will increase the investment in this
sector. Several positive steps have been taken to protect and promote
local industries, which will encourage the sector concerned," he
added. —UNB
