Thursday, 2 February, 2023

Austerity in Private Initiatives to Tackle Recession

  • Pranab Kumar Panday
  • 1st December, 2022 12:51:15 AM
  • Print news
Austerity in Private Initiatives to Tackle Recession

After the Corona pandemic, when people in various countries began to return to everyday life, the war between Russia and Ukraine, which began in early 2022, caused a global economic recession. Due to the impact of this recession, the economies of various countries started to collapse slowly. European countries and powerful states like the United States face various problems due to the economic recession. Economically, Bangladesh was on a solid footing during the first few months of the war but began to feel the effects of the global recession over time. As the foreign exchange reserves have started to fall short of the desired amount, the government is under pressure to cover the costs of imports.

As a result, the government and Bangladesh Bank have undertaken various programs to discourage the import of luxury goods. The government had to undervalue the currency significantly relative to the dollar in order to cope with the issue. However, little pressure has been felt so far to pay for import expenses due to several initiatives implemented by the government. If this trend continues, things could get really nasty next year. However, the IMF has been approached for loans by the government to deal with the emergency. The positive news is that the IMF has given a green signal for the loan, which has been reported in the media.

As the government implements austerity measures in various areas, the Hon'ble Prime Minister urged people to increase their savings. Persons working in government, semi-government, and autonomous organisations are prohibited from travelling abroad at government expense. As a result of the abnormal increase in the price of fuel and edible oil in the international market, the government has been compelled to increase the price of oil in the domestic market and to follow austerity in the electricity supply.

The abnormal increase in market prices has begun significantly affecting people's livelihoods, despite the efforts of numerous government institutions to curb the surge. The impact of the global economic recession has begun to affect the lives of the country's people. We have to remember that next year is an election year. Therefore, keeping this issue in mind, the government should take an influential role in dealing with the situation as soon as possible. As a result of various steps taken by the government, the situation has yet to go out of control. However, government, private, and individual initiatives are essential in dealing with the situation.

Most recently, Bollywood dancer Nora Fatehi's visit to Bangladesh to participate in the "Global Achievers Award 2022" organised by the Women Leadership Corporation has created a lot of controversy. She came to Bangladesh on November 18 and attended the event. Even before attending the event, there were various complications regarding Nora Fatehi's arrival in Bangladesh. A kind of confusion was created about her presence in the programme by presenting various statements on this issue from different levels of government. Later, the government permitted her to attend the programme, subject to conditions.

Another complication arose around the payment of her remuneration for attending the event, as her remuneration had to be paid in dollars. Consequently, the matter reached the NBR to determine how or by what process her remuneration would be paid. Later, a letter was issued by NBR to all concerned authorities regarding the payment of tax at source as per law on her remuneration or honorarium (Kalbella, 14 November 2022). It has been reported in various media that Nora Fatehi was at the venue for a short time, and the organiser had to pay her a considerable sum of money in foreign currency as remuneration.

The current government's efforts to advance women's equality deserve recognition for the significant strides they have made thus far. The Hon. Prime Minister Sheikh Hasina has made a tremendous impact on the advancement of women to positions of power in a variety of areas today. Therefore, it is necessary for the government and private initiatives to take various steps to encourage or empower women. But those who organised such an event needed to think to what extent the presence of Nora Fatehi in such an event was necessary. When the government has taken measures to discourage the import of luxury goods due to dollar crunch, one wonders how logical it was for Nora Fatehi to appear at the event in return for vast sums of money.

There is no denying that the women of our country will be inspired if they listen to the life struggle experiences of other women who have established themselves at different levels in different countries. As this is a reality, most of the country's people think that the decision to spend so much money during the current economic recession for presenting Nora Nora Fatehi as a guest and pay the remuneration in dollars should have been taken more logically.

We have to keep in mind that the foreign exchange reserves in the country have decreased a lot, and if they continue to decrease, an uncomfortable situation may occur in the coming days. In a situation where the government has decided to achieve austerity in various fields, the organisers needed to think a little more about the rationale of undertaking such a program as a private initiative. Bangladesh has many successful women in various fields, who have been established through many struggles. Bringing one of them to this event to share her experience with others could inspire fellow women.

Whether the country is going through a global economic recession or a Corona pandemic, private and individual initiatives must work with the government to improve things. The government should not be solely responsible for saving the country or the state from danger. Everyone should come forward to stand by the government in this crisis. But if private initiatives continue to undertake all such activities, a considerable amount of foreign currency will be spent on those activities, which may be ominous for the coming days.

Therefore, those who will think about organising such events in the future should think about the issue logically and then decide. Even those with various responsibilities at the higher level of the government should permit such an event after analysing the essence of such a programme more logically. If the impact of the global economic recession hits Bangladesh harder, it could create a dire situation for the country. We hope that such a situation can be tackled with the united cooperation of all, which was possible during the COVID-19 pandemic.

(The author is a Professor in the Department of Public Administration at the University of Rajshahi)