Subsidies, Tax Waiver to Loan Defaulters

Social inequality to rise: Speakers

Staff Correspondent

24 June, 2019 12:00 AM printer

Subsidies, tax waiver and providing facilities to loan defaulters are actually contributing to expansion of social inequality in the country, said speakers at a dialogue on the proposed budget on Sunday.

“It is laudable that poverty saw a drastic fall in the country recently, but at the same time income inequality and social inequality have also increased, which need discussions,” said Prof Rehman Sobhan.

“We’re providing subsidies, tax exemptions and giving benefits to bank loan defaulters—the facilities which are actually creating social inequality,” commented the noted economist while chairing the budget dialogue.

Centre for Policy Dialogue (CPD) organized the dialogue at a city hotel where Planning Minister MA Mannan attended the event as the chief guest.      

Prof Rehman criticized that most budget discussions are limited to allocations but discussions should shift focus on what the outcomes of the budgetary allocation are.

Speaking on the occasion Planning Minister MA Mannan claimed: “There is no society in the world where there is no inequality, but the government is trying to address the issue creating a wider social safety net.” 

He also criticized the economists and researchers, saying: “You teach in your books that inequality evolves in the way of development.”

Budgetary allocations are made after discussion with marginal people who say that the country has developed much in the last 10 years, but some people criticize the budget sitting at fancy hotels, offices and the Press Club. 

“Games played on different grounds yield different results; never similar results,” the minister explained the issue of budget analysis among different segment of people.  

The minister also said budgetary allocations are made according to the demands of “market lords,” which drew huge flak at the dialogue.

Former commerce minister and also a BNP leader Amir Khasru Mahmud Chowdhury said: “The minister has said decisions are taken depending on the market demands but crony capitalism as well as the market is not the same thing.” 

According to him, the market lords are a section of people comprised of the ruling lawmakers, businessmen and men in politics. 

Khasru raised question about the source of GDP growth, saying that the growth source figures are not in consistent with the growth rate. 

“Then where did the 8 percent plus growth rate come from? Such a high growth is actually a bubble,” he remarked.   The former minister also alleged that the growth figure is being utilized as a political tool.

Although it is being said that now time is for Bangladesh, private investment remains sluggish and no jobs are being created while people’s actual income in on the decline, he noted. 

In its budget analysis, CPD said the proposed budget will increase the living cost of low- and middle-income people while leaving enough room for the well-off segment. 

The important issue of urgent reforms to banking and financial sector has not prominently come, CPD said, adding that the issue of good governance and judicial reforms are also neglected in the budget.