Prominent economist Dr. Rehman Sobhan said, ‘We need a rule-based institutional framework, not an individual-based institution. Many do not believe that there are any rules in Bangladesh.’
He said, ‘If we really want to understand why foreign investment in Bangladesh is less than in Pakistan despite our high growth? We should investigate the reasons for the absence of credible institutions.’
‘Is the Bangladesh Paradox Sustainable?’ organized by the South Asian Network on Economic Modeling (SANEM) at BRAC Center in Auditorium on Sunday (21 April). He said these things at the unveiling ceremony of the book. Dr. edited the book. Salim Raihan, Dr. Francois Bourgogne and Dr. Salam Umar.
Prime Minister’s economic affairs advisor Dr. was the chief guest at the event. Mashiur Rahman. Honorable guest was the chairman of the Center for Policy Dialogue (CPD) Professor Dr. Rehman Sobhan and Professor of Development Economics at University of Ulster, UK. SR Osmani. In the event Dr. Salim Raihan and Dr. Umar Salam discusses the book. Eminent economists and academicians participated in the open discussion after their speeches. Among them were Professor Mahbubul Mokaddem Akash, Dr. Mirza M Hasan, Dr. Kazi Maruful Islam, Dr. Manjur Hossain and Dr. Sayema Haque Vidisha.
Dr. Rehman Sobhan said, ‘Other countries can be included in a broader analytical framework. When considering growth we note not only the paradox of Bangladesh, but also the paradox of Vietnam and China. They are moving forward economically despite having very weak institutions.’
He said, ‘We need to analyze institutions that are not rule-based, that do not operate according to written laws. Institutional failure occurs when there is a departure from a normative system. People then refuse to trust any institution.’
In the speech of the chief guest. Moshiur Rahman emphasized the important link between tax legitimacy and effective tax collection. He said that tax policies should also come under scrutiny. He also called for supplementary duty and value addition, as well as a more specific application of excise duty before revenue growth. He expressed concern about the turnover tax, suggesting that its primary function is to protect business people rather than to raise revenue. He also pointed out that informal financial transactions inhibit savings and informal financial transactions also lack economic utility. Besides, he discussed the complications of loan repayment in the banking sector.
Research Director of Bangladesh Institute of Development Studies Dr. Manzoor Hussain insists that if there is a paradox, there should be a fixed time-frame when the paradox can disappear. If Bangladesh were to achieve middle income status, this paradox would not survive.
He also said that considering the neo-classical situation, the political regime has a great impact on the institutional situation. Focus should be on export diversification, trade liberalization.
Professor Dr. Siddiqur Rahman Osmani highlighted an important aspect of the methodology and said that the project emphasized on identifying ineffective institutions. But there was not much discussion about the effective institutions. Why don’t we discuss the institutions that are actually doing well? It is even more paradoxical than the paradox of Bangladesh. We must deal with both effective and ineffective institutions simultaneously.
Professor of Dhaka University. Kazi Maruf said, in the chapter on the judicial system, we tried to find out why so many people lose their land. Courts are indeed important, but they have countless cases to handle. About 4 million cases are pending. Regarding the problems of the court, he said, not having enough judges, not being independent, not having people who know about the law. If these conditions are not good, the judicial system will stop the progress of Bangladesh.
Sanem research director and professor of Dhaka University talked about the banking sector in the book. Sayema Haque Vidisha. He highlighted the inefficiency of banking and the inefficiency of the judiciary. points out that inequality is often under-reported in official statistics. Dr. Bidisha said that Bangladesh’s performance in terms of access and financial inclusion is surprisingly good. He identified the lack of central bank autonomy as a significant problem, suggesting a strong, independent central bank could solve many problems. Dr. Bidisha also cited weak corporate governance as a concern. Highlighting the problem of bank mergers, he emphasized the importance of internal reforms.
Chairman of the Policy Research Institute. At the beginning of Zaidi Satta’s speech, he compared the hope of the newly born Bangladesh that he saw as a young person with the reality of Bangladesh that has passed 50 years. He said, when Bangladesh became independent, I was working as a young civil servant. I had some hope then, despite the many limitations of our country, that Henry Kissinger might disagree with. There was no expectation of Bangladesh transitioning from an LDC or becoming the second largest exporter of ready-made garments. Today after 50 years, various countries including the World Bank identify our economy as successful.
Crediting the hard work of Bangladeshi workers. Sattar refrains from characterizing it as a paradox. He points out how population, which was initially considered a problem, is now seen as an asset.
Professor Dr. MM Akash said the book concludes that sustaining the paradox depends on improving the institutional sector. He emphasized the inadequacy of easily granting autonomy to the banking sector, noting that negative forces often overwhelm positive forces, making reforms difficult.
Senior Research Fellow of BRAC Institute of Governance and Development (BIGD). Mirza M Hasan said that there is not much secret about what is happening in the global banking sector. He noted that state capture has been going on for some time, affecting private sector regulatory policies. He asks whether the dominance of the logic of capital in the banking sector is moving towards liberal capitalism like the US or political capitalism like China in terms of political cronyism? He commented, ‘We are seeing a very rapid assimilation of the dominant party state in Bangladesh.’
EAR/KSR/GKS
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