Economists have laid emphasis on ensuring distributive justice; while allocating resources to various sectors in the upcoming national budget of Bangaldesh.
Economists like former governor of Bangladesh Bank, Dr Salehuddin Ahmed, BIDS (Bangladesh Institute of Development Studies) research director Dr. Zaid Bakth and leading banker Ibrahim Khaled believe that a high GDP figure itself is not enough to bring improvement in the living standard of the common people. There must be a way of ensuring distributive justice in resource allocations as well, they felt.
While recognising the decline in the poverty level in the country in recent years, especially the extreme poverty, they pointed out with dismay the ever widening income gap between the rich and the poor.
The economists, thus, favoured strengthening of the social safety net programmes through increased allocation of budgetary resources.
They felt that the public sector investment was highly instrumental in creating new jobs, which in turn, will help generate income of younger people, they said.
Economists have also found the GDP growth estimates done by the Bangladesh Bureau of Statistics (BBS) for the outgoing fiscal (2013-14) not truly conjunctive to the ground realities as the first half of the fiscal as political troubles caused severe disruption to activities of both services and manufacturing sectors.
The BBS has moreover shown the per capita GDP at Tk 86,731 and per capita GNP at Tk 92510 for the outgoing fiscal.
Dr Salehuddin Ahmed said there is no doubt, the per capita income of the people has increased over the recent years and the poverty level decreased. But the hardship of the common people is also on the rise despite a rise in their income level.
This is because of the fact that the cost of living has been exponentially rising with the rise in income; because of constant rise in house rent and expenditures on food and transportation.
Thus the gap between the rich and the poor is widening instead of declining, he said pointing out that about 10 percent people now control 60 percent of the nations resources and the lower 60 percent may have access to only 5 percent wealth.
He said the government is now in haste to show higher growth to achieve the middle income country status. But the accumulation of power and wealth to handful of persons is going to create wider income gap in the society in the process, he said.
He said the government must make the best use of the budgetary resources to reduce the rich-poor gap and reach more benefits to the common people.
Dr Zaid Bakth said the trickle down effect will not be enough to help the low income people earn incomes necessary to make a decent living. He said that over the recent past the number of extreme poor has declined but income inequality widened.
The number of highly rich has increased through corruption and unearned income. They have exploited political shelter and poor governance to achieve their target. Dr Zaid Bakth said the government has various safety net programmes for the poor but those may not be enough.
He said, “The most important anti-poverty programme may be to encourage public and private investment to create more jobs and income. Livelihood grants or subsidy in our economy may not be sustainable over time”. Dr. Bakth supports the move to levy wealth tax in the budget.
He said political crisis must be resolved to give investment a risk free drive. People are shy of investing funds despite a relative calm political climate. Banks have enough reserves and yet people are not taking interest to go for bigger investment, he said.
Khondker Ibrahim Khaled however observed that the income disparity is narrowing over the past three years and it has not widened any way as some people claim. He said the current budget has over 12 per cent allocations to safety net programmes of various sorts and in terms of money it is too big. It partly attempts at ensuring distributive justice to people in extreme poverty, he said