begum zia state of the economy. 2010

8/9/2019 Begum Zia State of the Economy. 2010

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Bismillahir Rahmaneer Rahim

Distinguished colleagues, Excellencies, Ladiesand Gentlemen,

Aassalamu Alaikum

A warm welcometo youall

As youareaware,two tragic incidentsat Nawabkatraand Begunbariinthe capital has ledto thedeath of overonehundred fifty people ofdifferentages. Many arestill moaninginpain from severeburnsand injuries. Theentire country is inastate ofdeepshockandmourning. May Allah Rabbul Alameengiveusthe courageand fortitudeto overcomethis

national tragedy..

The warningsignalsunderlyingthesetwo accidentsmustnotbe lostsight of. Wehavetoexerciseextreme cautionso thatsuch calamitiesdo notbefall usinthe future. Wehavetotakemeasures for theprevention ofsuchaccidents in the future. Wehave to find waysandmeans to limit the loss of lifeandproperty at theminimum levelspossibleshouldsuch calamitiesbefall usinthe future. This will requirethatimmediatestepsbetaken forthe deployment of required personnel and provision of essential equipment. I amrequestingthatadequatemoney forthisbeprovidedunderthenew budget.

Ladiesand Gentlemen

Sincethehanding overoftheresponsibilities ofthegovernmentby the BNP-ledalliancein 2006, weall have witnesseda continuousdegradation of Bangladeshinall aspects. Somuch so, that the nation is now in the grips of a serious crisis. The incompetence,despotism, poor governance, corruption, politics of division and discord and seriousdeterioration ofthe law and ordersituationhas furtherdeepenedthe crisisandhasspelttotal failure ofgovernanceandthegovernment.

We are most concernedby the systematic assault on the very institutions that are thepillars of a just and democratic country. The independence of the judiciary and theeffectiveness ofthebureaucracy havebeen totally underminedby partisan interventions

and intimidations. Themedia isunder serious threat, the Parliamenthasbeen renderedineffectiveandthepolitical cultureinthe country hasbeen vitiated.

Energy crisis has led to the closure of industries, fertilizer factories and the onceflourishinggarments industry isunderseriousdifficulties.Dueto theerroneouspoliciesofthegovernment, overseasemployment of Bangladeshishasbeen onasteepdeclineandmany arereturninghomeempty handed.


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Ladiesandgentlemen

None of theseaugur well for the country. There isa real danger that theeconomy willfalterand collapseinthe coming years. Ourpoliticsis forthe welfare ofthepeople,andwedo not wishto seethemgo throughdays ofeconomic andsocial hardships.

Withthatin view, I havedecidedto placebeforethenation ourviewsandthoughts onthenextbudget,primarily reflecting ourdesireto extend cooperationto thegovernment. Wehave offeredsuch cooperation on various issues ofnational interestinthepastas well,but withoutany avail.

Unfortunately, the attitude andbehavior of the members of the treasury bench do notprovidea congenial environment forhealthy discussions onmatters ofnational interestintheparliament.. I have thereforedecided to offer our thoughts andproposals throughyou.

I believe minimal good intentions on thepart of the government to pay heed to ourproposals willputthisgovernmentbackontrack.

Bangladesh Nationalist Partys Philosophy for Economic Development ofBangladesh

Theeconomic history ofindependent Bangladeshis fourdecades old. The firstthreeandhalf years of thisperiod, ruledby the Awami Leagueand its laterday metamorphosisknownas BAKSAL, weredepictedby a Bangladeshieconomistas the lostmoments.Some also termed the new country as abottomlessbasket.During those years, in thename of socialism, state capitalism became the cornerstone of all economic policieswhich createdunbridled opportunities forsquanderingnational wealthandresources. A

whole new class of rent-seeking individuals and groups emerged who were leastconcernedabout fosteringproductiveactivitiesintheeconomy.

Theemergence of President ZiaurRahmanduring late 1975, ledto thedismantling oftheautocratic one-party rule ofthe Awami-BAKSALites,andthe lofty ideals ofmulti-partydemocracy and politics of participatory economic development were put back intopractice. Development initiatives weredecentralizedatthe local levels,andbeneficiaryparticipation in rural infrastructure construction was promoted. However, during thesubsequentautocratic nine years of General Ershadsrule,theprocessessetinmotionbyPresident Zia werereversedandasystem of crony capitalism was forgedto supporttheautocratic regime. Thenationstill continuesto suffertheadverseeffects of that.

BNPs overarchingphilosophy for economic development of Bangladesh is distinctlydifferent from what was espoused by both the Awami- BAKSAL and Ershadgovernments. It firmly believes that policies and programs for economic growth inBangladeshmustbeunderpinnedby the followingpremises:

y privateentrepreneurship,initiativesandinnovativeness,supportedby anenablingpublic policy regime,arepotentagents foreconomic growth;

y broad-based employment and income generation is essential for povertyalleviation;


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y affirmative action is necessary to mainstream the relatively disadvantagedsegments ofthepopulation irrespective ofgender, caste, creed,religion orethnicorigin;

y equitable incomedistribution is importantnot only for fairplay andjusticebutalso forexpandingdomestic market;

y efficient and environment friendly production of goods and services gearedtowardsmeetingthe increasingdemands inthe largedomestic marketas well asforexportsareimportantelementsindevelopingaselfrelianteconomy;and

y complementarities in the use of public and privately (individual/group/cooperative) owned resources have thepotential to enhance resource useefficiencies.

BNP firmly believesthatagriculture,industriesandtheservicessectors will haveto playincreasingly importantroles inachieving thedesiredeconomic development objectives.Bangladeshbeing a highly populated country withnearly 80% of itspopulationbeingrural, we dont see any alternatives to achieving food autarky, and diversification of

agriculture into higher value cropsand livestockproductsby exploiting theunrealizedpotential in theagriculturesector. Likewise, wedo notseeany alternative to buildingaknowledge based society and interfacing with the global knowledge economy as aninstrument forthepursuit oftheabovestateddevelopmentpriorities..

BNP, therefore, believes that skills formation and technology development throughsustainedpublic investmentsineducation,research,andinformationand communicationtechnology wouldbepivotal forachievingthedevelopment objectives outlinedabove.

Socio-economic Development Under two BNP-led Governments

BNP hadtheunique opportunity ofbeingthe firstelectedgovernment (1991-96)undera

pluralistdemocracy, followingthedemise ofanearly decade longautocratic rule. Majorpolicy andstructural reformsto openupand liberalizetheeconomy,rationalization oftheduties and taxation regimes, introduction of VAT, establishing the Securities andExchange Commission fordevelopingthe capital marketarea few oftheexamples oftheepochmakingreforms that were carried out.

Notwithstanding the obstacles (close to 250 hartal days, street agitations,parliamentboycottetc) imposedby the then oppositionparty, soundmacroeconomic managementandsector investments yieldedanannual GDP growthrate in theneighborhood of 4%,poverty reduced at an annual rate of about 1%, stipends and free tuition for girlsdramatically increased theirparticipation in Secondary schools (from 34% in 1990 to47% in 1996 and 53% in 2000);total fertility ratedecreasedto 3.3% (1997), comparedto

6.3% earlier.

The achievements of the 1991-1996 government are widely acknowledged to haveushered inanera ofeconomic rejuvenationandprogressandput inplace thebuildingblocks foracceleratedgrowthduringthesubsequent years.

The BNP led 4-party alliancegovernment (2001-2006) furtherexpanded,sharpenedandstrengthenedtheeconomic developmentprogramsandreforms ithad initiatedduring its


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previous tenure. Some of the key economic indicators at the last year (2006) of thegovernmentareas follows:

y HighesteverGDP growth of 6.7% (average 5.7%pa)y Inflation containedat 7.2% despitehighinternational pricesy Budgetdeficitbroughtdownto 3.7% (6.3% in 2001)1y Foreign financing ofdeficitreducedto lessthan 1% of GDPy National savingsrateincreasedto 27% of GDP (22% in 2001)y ADP allocations of 5.5% of GDPy ADP expenditure of 79.5% of original and 90.6% ofrevisedbudgetsy Domestic investmentsteadily increased 25.3% of GDPy Total FDI (2002-06) US$ 2671m (US$ 831m1997-2001)y Incidence ofpoverty reducedto below 40% (1.8%perannum)y Highesteverindustrial sectorgrowth of 10.8% (average 7.8%)y Agriculturalproductionincreasedby 5.03% (3.1% in 2000)y Overseas workers remittances increased to US$4.8 billion (US$1.8 billion in

2001)2

y Degree of openness3 of theeconomy estimatedat 43.3% ( 16.8% in 1991 and

33.4% in 2001)

y Extent ofglobalization4 oftheeconomy estimatedat 55.6% (24.9% in 1991 and41.4% in 2001)

Prime MinisterSheikh Hasina claims thatduringherpreviousgovernment (1996-2001)food self-sufficiency hadbeenachieved. But this is farthest from truthbecauseduringthose five yearsaverageannual imports ofrice were 2.4 milliontons, withan importashighas 5.5 milliontonsin 1998-99.

Clearly, the BNP led government of 2001-06 achieved much higher rates of GDP,

industrial andservicessectorgrowths, containeddomestic inflationto substantiallybelowthedoubledigit,maintained foodsecurity, increasedemployment opportunitiesathomeand facilitated overseas employment, substantially improved itsposition in the humandevelopment index,successfully mitigated thepost- MFA phase out crisis facedby theready made garments and, most importantly, made significant reductions in humanpoverty.

The economy was poised for a take off to a higher level, and we believe that had the

process not been interrupted by the imposition of the army controlled unconstitutional

government on January 11, 2007, Bangladesh would have achieved and sustained a

growth level that would have been adequate for the country to have graduated to a

middle income country by the year 2015.

1including foreigngrants..2this wasdueto streamlining oftheremittance facilitiesandprocedures3 value ofexportsandimportsas % of GDP4 all types ofexternal flowsas % of GDP


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Unfortunately, however, most of the key macroeconomic indicators have significantlyworsenedsince 2006,andit will take well structuredandsustainedeffortsinall frontstoputtheeconomy backontrack.

The Catastrophe of January 11. 2007

Notwithstanding the pre-meditated anarchy and violent street agitations (leading tomerciless killings)by the Awami league and its cohorts, thenation was ready for theelections to the Ninth Parliament rescheduled for January 22nd, 2007. Catastrophe,howeverbefell thenation whenFakhruddin-Moinuddinusurpedpowerand installedanunconstitutional CaretakerGovernment on January 11, 2007.

This illegal government, on theplea of eradicating corruption and improving law andorder and governance, embarked on a planned program of arrest, harassment, andinternment ofpeople from all walks of lifeparticularly politicians,political workers,businesspeople, traders, professionals, students and labor leaders. Traditional ruralmarkets,humanhabitatsandurbanslumdwellings weredemolished,thusdisruptingthelivesand livelihoods ofthepoorpeopledependant on therural andperi-urban informal

economies.

Largesegments ofthepopulation who hadearliercrossedthepoverty barrier, wereagainthrownbackbelow thepoverty lineasaresult ofthisunjustifiableandthoughtlessactionof the then caretaker Government. According to World Bank estimates,nearly fourmillionpoorpeople were thrownbelow thepoverty lineasaresult oftheseactions. Tomake things worse,uncontrolledgeneral and foodprice inflationdroveup theprice ofrice,basic stapleand wagegood,to TK 45/kg, creating livelihoodproblems formillionsofpooras well asmiddleand low income families.

Seventeen Months of 14 Party Alliance Government: A Dismal Score Card

Prime Minister Sheikh Hasina gleefully boasted that the so-called one-elevengovernment was the harvest of herpolitical movement and agitation. Subsequenteventsproved how true she was, as she was able to collude with theunconstitutionalFakhruddin-Moinuddin caretakergovernmentandhad the 14-party allianceelected tothe 9thparliamentatthegeneral electionsheld on 29thDecember, 2008,the credibility ofwhichisstill opento legitimatequestions..

Thepresentgovernment, sworn in on January 6, 2009, takes comfort in comparing itsperformance so far with that of thepost-one eleven caretaker government. But themeaningful bench mark for comparison must be the achievements of the BNPgovernments of 2001-2006 and with that of 1991-19996. I wouldnow like to highlightsome ofthe outcomes ofthe 17 months ofthepresentgovernmentinthat lightas well asagainstthebackdrop oftheirelectionpromises.

Despitedownturnintheprices ofinternationally traded commodities,thegovernmenthasfailed to contain inflation which now has reached double digits. When I handed overpowerto the caretakergovernment on October 27, 2006,theretail prices of coarsericewas Taka 17/18 perkg,pulses (masur dal) Taka 60 perkg,soybean oil Taka 55 per literand importedpowdermilk Taka 380 perkg. Total inflationpeaked at 7.17%,despitehighinternational prices.


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Atpresent,however, coarsericesellsat Taka 29-30 perkg (electionpledge forTaka 10perkg),pulsesat Taka 85-120 perkg,soybean oil at Taka 80-85 per literand importedpowdermilkat Taka 520 perkg ,although international pricesare substantially lowerthan what was facedby my government.

Prime Minister Sheikh Hasinapromised free distribution of fertilizers. Urea currently

sellsat Taka 12 perkg, compared to Taka 6 perkgduringmy government, TSP amdMOP at Taka 22-27 per kg, compared to Taka 15 per kg during my government. Anumberof fertilizer factorieshavebeenshutdowndueto powershortages. Many farmerscomplainthatimported fertilizersare oftenadulteratedand of low potency.

Exports during the first eight months of the current fiscal year went downby 3.25%(4.96%, during the first six months) compared to the corresponding periods in theprevious fiscal year. To comeatpar with the last fiscal yearsexports,another US$ 7.2billion inexportearnings will be required, whichdoesnotseemplausibleat this time.Chronic energy crisishasprecipitatedthissituation. The largergarments industrieshavesomehow managedto keepuptheirexportproductionsby maintainingpowersupply withtheirowngenerators,butmany small andmediumsizeunitshavenotbeenableto do soandproductions have ceased. Power shortages have also interrupted anddisrupted theproduction schedule. In order to avoid cancellation due to delays in delivery, manygarment manufacturers have to resort to costly (US$ 6.5 per kg) airfreight of theirproducts.

Remittancesby overseas workersarealso comingdownasthegovernmenthas failedtonegotiate with the traditional manpower importers (Malaysia, Korea Saudi Arabia andother Middle Eastern countries) for continued recruitmentand retention of Bangladeshiemployees. Despite repeated assurancesby the Prime Minister, theproblem of Iqama(employment contract) transfer for our migrant workers in Saudi Arabia hasntbeenresolved. Consequently many of our overseas workersare returningat theend of theircontracts as they can notbe reemployed. Thisproblem ispeculiar to the Bangladeshiworkers only.

This year total employment overseas in the four countries of Middle-east have comedown to amere 56,275 (only 2255 in Saudi Arabia) compared to 419,355 (132,124 inSaudi Arabia)two yearsago.

ForeignDirect Investment (FDI)havedeclinedalarmingly. According to a BangladeshBank survey, FDI during January-June of 2009 declinedby 40.61% compared to theprevioussix months. Themuchheraldedandhighly expensiveroadshow to attractFDIwasapparently anexercisein futility.

After fifteenmonths ofinaction,thegovernmentsuddenly decidedto award contracts forpurchasing electricity from rental power generation units, without going through thenormal biddingprocessandrespondingto unsolicitedbids. It wouldnotbe out of linetosuspectthatanartificial powercrisis was createdby the vestedinterestssurroundingtherulingparty to justify thisso-calledemergency procurement, floutingthe letterandspiritofthe Public Procurement Regulations.


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The Public Procurement Regulations, enactedby my government and internationallyacclaimed,to bringtransparency and faircompetitioninpublic procurement ofgoodsandservices,havebeendrastically amendedto allow cronyismandrentseeking. The WorldBankand otherdevelopmentpartnershave objected to these changes,but withoutanyavail. Itis worrisometo notethatthegovernmentisnow contemplatingto make changes

in the Telecom Regulatory Commission and, suspiciously enough, just when thegovernmentisplanningto give licenses fortheprofitablebusinessin VOIP.

Law and ordersituationandrule of law hasdeterioratedalarmingly. Incidents ofdaylightrobberiesandmugging,kidnapping,storebreakin,hijackingetc havebecomeevery dayaffair. Morethan 50 highereducation institutionshavebeen closedsine die inthe wakeof factional fightsinthestudentgroupsaligned withthe Awami League, onissuesrelatedto procurement of goods and services, allocation of space in the student hostels,admissionsto academic programsandextortions of varioustypes. Therearealso reportsof forcing girl students from colleges into immoral activities involving thepowerfulpolitical functionaries.Daily newspapersabound withsuchnews.

Thereisasinistereffortunderway to mufflethe voice ofdissent,andthe freedom ofthemedia isunder ominous threat. One of themost widely viewed television channel hasbeen closed, the face-book on the internet hasbeenbanned, andjust a few days agopermission for apopular Bengali daily, Amar Desh, was revoked, its offices raidedduringmid-nightandtheeditorarrested onridiculously flimsy grounds. Clearly andtrueto thepasthistory oftheparty inpower,thegovernmentneitherwants to hearnorreadthe voices ofdissent.

The wings ofthe Anti-corruption Commission,establishedby my government,havebeendrastically clippedand itsstatusasan independent constitutional body hasbeenreducedto bea lameduck. High Courtjudgesarebeingappointedinanon-transparent way, writbenchesarebeing constituted withjuniorjudgesbypassing the seniorandexperiencedones, and the Attorney General is interfering with the judicial process illegally andimmorally.

The various cases instituted against politicians by the Fakhruddin-Moinuddingovernment arebeing disposed off administratively and onpartisan grounds. So farmore than 5000 casesagainst Awami League leadershavebeenquashed, while only ahandful against BNP politicians. Convictionsagainstmany offendershavebeensetaside,whilemore than 50,000 peopleaccused of serious criminal offences includingmurder,rape,extortionand corruptionhavebeenset free withoutthedueprocess of law. All theseare raising seriousand legitimate concernsabout the neutrality of thejudicial process,equality ofall intheeyes of law andaboutthepotential formiscarriage ofjustice.

It seems that the present government is determined to demolish all the institutions that

guarantee good governance, rule of law, basic citizens rights and healthy democraticprocesses.


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We are concerned by the myopic nature of the governments foreign policy. It isinexplicably focused on adhering to the desires and demands of India, often to thedetriment of the national, territorial and socio-economic interests, and cultural andemotional prideandaspirations ofthepeople of Bangladesh. Ourgoodwill and friendshipfor thepeople of India isunquestionable. We remember thesupport of thegovernment

and Indianpeopleduring ourwarof liberation. However,asit is with other countries ofthisglobal village, weaspire to havemutually beneficial relationship with India on thebasis ofsovereignequality,nationalpride,transparency andmutual respectandtrust.

Keeping the above in view, we feel that the three agreements and a fifty pointmemorandum ofunderstandingexecutedduringtherecent visit ofthe Prime MinistertoIndia havebeendone withunduehasteand without the required consultation with theparliament,political partiesand thepeople at large. Theseagreementsand MOU haveceded to Indiaanumber ofprivilegessuchas theuse of Chittagongand Monglaports,land corridorthrough Bangladesh forthetransportation ofgoodsandservicesto and fromthe territories of India, access to the fiber optic submarine cable in Bangladesh, and

import of 250 mw ofelectrical power.

Wearenotaware ofhow the incremental costs consequential to the implementation oftheagreements will bemet. Cateringto theneeds of India will require largeinvestmentsinupgrading the facilitiesat the Chittagongand Monglaportsas well asat theborderlandports. Thehighways connectingthe Indianborderpoints with ourport citiesas wellasthe Jamuna Bridge will haveto besubstantially upgradedto allow expandedandheavyvehiculartraffic.

Wearenotaware of what financial andeconomic benefits will accrueto Bangladeshandwhetherthe longstandingproblemssuchasthehugetradeimbalancesin favorof India,tariffandnon-tariffbarriersto exports from Bangladesh,sharing oftheinternational riverwaters that flow through Bangladesh, Indias plans to construct at least six morebarrages/dams on rivers flowing through Bangladesh,delineation of landandmaritimeboundaries,and wantonkillings of Bangladeshisby the Indian Border Security Forceswill beaddressed withthesame vigorasthosebenefiting India.

Perspectives on the implementation of 2009-2010 Budget

Thebudget for2009-2010 wasbased ofanestimated GDP of Taka 686,730 crores. Totalexpenditure wasestimatedat 16.6% of GDP,revenueearningsat 11.6% of GDP,non-ADP expendituresat 12.1% of GDP, ADP expendituresat 4.4% of GDP,andabudgetdeficit of 5%. Meanwhilepoorimplementation ofthe ADP has ledto a 7% reduction inthe ADP to Taka 28,500 crore.

Notwithstandingtherhetoric,the objectivesandtargets ofthe lastbudget weremodestinview of the development imperatives. Considering the current state of the economy,discussed earlier, one can not but come to the unfortunate conclusion that theimplementation of the budget by and large has failed to achieve the stipulatedmacroeconomic and sector development objectives. It has notbeen able to arrest the


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deterioration ofthemacroeconomic fundamentals followingthe completion ofthetenureofmy governmentin October2006.

Annual GDP growth is likely to bearound 5.5%, which issubstantially lower than thegovernmentprojection of 6.7%, as well as those of 2008-09 (5.9%), 2007-08 (6.2%),

2006-07(6.4%)and 2005-06 (6.7%).M

ore worrisome is the fact that for the first timein 15 years GDP growth has fallen four years in a row. This doesnt augur well for our

fundamental development objective of poverty alleviation.

Weneed to achieveandsustaina GDP growth ofbetween 9-10%,at least forthenextfive years in order to position Bangladesh fora leap into theranks ofamiddle incomecountry. Given the Awami League governmentspast record (average 5.34% during1996-2001)and currentperformance it isunlikely that they will beable to achieve thisrequired GDP growthinthenear future.

Themomentum createdby my previousgovernmenthasbeen lostand it will takemore

than rhetoric andgrandiosepromises to restart, warmupandaccelerate theengines ofgrowth.

Growth objectives fortheindustrial sector,i.e.increasingitsshareinthe GDP from 28%to 40%,hasnotbeenachievedas thesectorhasgrownatapaltry rate ofaround 4.5%,compared to 10.8% in 2006.Despite all the talks ofbeing an agriculture and farmer-friendly government,agriculturehasgrownatadismal rate. Thebudget objectives forbringing down both the unemployment rate and the proportion ofpopulation belowpoverty line to15% havealso notbeenmet. On the contrary,governmentsurveysshowthat some 2.8 millionpeople havebecome unemployed, and the situation is likely tofurtherworsenbecause of loss ofjobs overseas.

Proposals for creating a Taka 100 crore Infrastructure Investment Fund didntmaterialize due to a lack of clear principles and procedures for its implementation.Likewise, a Taka 100 crore Public Private Partnership Fund and a Taka 300 croreViability Gap Fund didnt take off as these couldnt attractprivateparticipation orinterest, perhaps because of faulty conceptualization, design and implementationguidelines. Out of the Taka 700 crore Climate ChangeFund, only Taka 46 crorehasbeen spent, again due to indecisions in the relevant government agencies and lack ofimplementationplans.

Thebudget,to start with, waspessimistic abouttheperformance of theexportsector inFY 2008-09 andpredicted that itsgrowth ratemay comedown to 12%. In factexportgrowthduringtheprevious fiscal yearcamedownto 10.31%. Alarmingly enough,exportgrowthduringthe current fiscal year,hasbeenestimatedat (-) 3.2%. I would like youtonote thatduring the final year ofmy 2001-2006 government,exportgrowth clockedat23.1%.

Investments havebeen in doldrums. An investment level of 24.65% in 2006 has nowfallenbelow 24% ofthe GDP.ForeignDirect Investmentsduring July-February of this


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fiscal year was only US$232 million, as against US$722 million during thecorrespondingtimeintheprevious fiscal year.

Webelieve the Annual Development Program (ADP) of Taka 30,500 crores was theminimum level that should havebeenbudgeted. This was, however, reduced to Taka

28,500 croresdue to implementation constraints. In the first nine months of the fiscalyearonly about 44% and,as ofdate, 60% oftherevisedallocationshavebeenexpended.This is a dismal picture and represents anunacceptable degree of inefficiencies in theplanningandimplementationmechanism.

The government has miserably failed to mitigate the key maladies that have hindereddevelopment activities: chronic and deepening energy crisis, labor unrest and

anarchy in the ready made garments sector, urban congestion, deteriorating law

and order situation, unfettered rent seeking and hooliganism by those connected

with the ruling party, and an administration that is becoming increasingly

moribund due to political victimization of administrative and managerial staff at all

levels of the bureaucracy.

Some 400 officershavebeensetasideas Officers on Special duty,meaningthey havenoassignedposition,andmany havebeentransferredto posts withno important functions ordeprived of due promotions to higher positions. Many are under constant threats,surveillanceandintimidations. Thisisnota congenial environment forthebureaucracy tofunctioneffectively andefficiently.

Victimization ofpublic servants on flimsy political grounds serves no useful purposeotherthandemoralizingthemand forcingthemto come closeto onepolitical party ortheotherasasafety-net. Public servantsservethe cause ofthe Republic andhaveto loyallycarry outtheprograms of whicheverpolitical party holdsthereigns ofthegovernment. Ifthis ismisconstruedandpenalizedaspolitical alignment,thenmostpublic servants willloosetheirmotivation forgivingthenationtheirbestunderanypolitical government.

A numberof Ministrieshavean Advisor inaddition to the Ministerand State Minister.This is inconsistent with the relevantprovisions in the Constitution and has createdseriousproblems of coordinationand chain of commandinthese Ministries. Itisnot clearwho has theprimary responsibilities for decision making and conducting the day tobusiness,particularly with respect to the Minister and the Advisor. This dual-headedstructure has clearly contributed to delays in the decision makingprocess asboth theincumbentsare fighting for turf. The currentstalemate in the Ministry of Education ongrantingsalary subventionsto privateschoolsand collegesisa caseinpoint.

The Budget for the FY 2010-2011

Asa responsible leader of the oppositionand former Prime Minister, I do not takeanycomfortandpleasure from the failure of thegovernment inaddressing theproblems ofthe country. I do,however,hopethatthegovernment, in formulatingnext yearsbudget,


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will takedue cognizance oftheproblemsthathave contributedto thenon-realization ofthe objectivesandphysical targets ofthe current yearsbudget.

As we all know,budgets for a developing country like Bangladesh is not simply anexercise inarithmetic forbalancingprojectedrevenueearningsandexpenditure. Itmust

be designed as an instrument for promoting welfare of the people, fostering socio-economic developmentandenhancingproduction ofgoodsand services. Allocation ofresources to available alternatives mustbe guidedby theprinciple of most efficientapplication of limited resourcesamongsectors of clearly definedpriorities. Within thisconceptual frameworkandguidingprinciples,my specific proposalsareprovidedbelow.

Power and Energy. Thepresentgovernmenthasbeen talking of itsgrandioseplans fornew electricity generation. However nothinghashappened so farexcept for the recentinitiatives forsettingup rental powerunits, theprocurement of which isbeingdone inviolation ofestablishednorms. Weare concernedthatthehighpurchaseprice (Taka 14 to16 perunit) ofpower from theproposed rental units will, in theabsence ofsubstantial

subsidies to PDB, result in much higher tariff to the users, thereby affecting theprofitability of the industries sector,particularly the small andmediumenterprisesandtheagriculturesector,apart from causinghardshipto household consumers.

Shouldthegovernmentdecideto providesubsidies,inthe coming yearaloneit will entailanestimated Taka 7,000-9,000 crore, which ismore than triple the total allocations for(Tk.2600 crore) forthe last fiscal year,andis likely to behigherthanthetotal allocationsforthe coming fiscal year. Variousprevailingsubsidiesaccount forasubstantial portionof our public expenditure. This additional burden of subsidy will entail reducedallocations forotherequally importantsectors oftheeconomy. Thegovernments willfuldelaysto justify anunsolicitedandshady procurement oftheserental units will causethiswastage ofscarceresources.

The Governmenthasenteredinto an Agreement with Russia forestablishinga 1000 MWnuclearpowerstation. Itisstill in very early stagesandthedetailsare yetto be workedout. While wehaveno objectionsto thisinprinciple,and lookuponthisasa longertermsolutionto ourpowerandenergyproblem, I would,however, liketo raiseasafety relatedissue. Bangladeshbeingadensely populated country,it will beimperativeto ensurethatfull-proofsafety measuresareenforcedto protectthepopulationagainstany eventualitiesarising fromtheuseandhandling ofradioactivematerials,particularly withrespectto thedisposal of nuclear wastes. In the US a ten mile exclusion area surrounding a nuclearplant is required where no human habitation is allowed.Yet, the world has witnessedhumanmiseries ofuntoldproportionsresulting fromaccidentsevenunder conditions ofstate-of-thearttechnology andhigh levels oftechnical and operational expertise.

I,therefore,suggestthatinstead ofrushinginto theproposedproject,moreasastuntandpalliative, the government should first carefully evaluate relevant financial, economic,technical, operational and safety related issues, while concentrating on economicallydefensibleneartermsolutions ofthepowerandenergy crisis.


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Without discounting the importance of establishing new capacities and exploringalternative energy sources such as nuclear, solar, wind, geothermal etc., I would,however, liketo point outthatitshouldbepossibleto generateand feedinto thenationalgridanestimated 700-800 MW ofadditional electricity within 7-8 monthsthroughmajoroverhaul, repairs and routine maintenance of some 40 units that are 20 years old.

Enhancingthe capacities ofthedistributionsub-stations will also allow smootheningthesupply of electricity. These would be definitely preferable solutions in the interimcomparedto payinghighpricesto rental units. Wesuggestthatthegovernment considersthisand othersuch options formitigation oftheprobleminthenearterm,intandem withplannedinvestments forgeneratingadditional capacities forthe future.

Wesuggestthattheproposedbudgetgivestoppriority to exploration ofnew gasreservesin orderto easethesupply ofgas forpowergenerationas well as forfertilizerproduction.Towards that end, the technical and financial capabilities of Petro-Bangla should besuitably enhanced. Optimumuse of ournational reserves of coal forpowergenerationshouldbeensuredby expeditingextraction of coal,albeit withappropriatemeasures for

mitigating theenvironmental hazardsas well as for rehabilitationand compensation oftheaffectedpeopleintheminingareas.

Education. Theachievements ofmy two previous Governments inthe field ofeducationhavebeen widely recognized nationally and internationally. Ourbudgets gave highestallocation fortheeducationsector. Ourpolicies were focused onexpanding institutionalcapacities forbothgeneral and technical/vocational education, ensuring gender equity,enhancing quality of education at all levels and ensuring thatpoverty will notbe animpedimentto access.

As a result, net enrollments at Primary schools reached over 95%,proportion of girlstudents at primary, secondary and higher secondary levels increased to over 50%,quality ofprimary andsecondary school teachersatentry wasensured,teacherssalariesandbenefits wereenhanced,passratesandquality atpublic examinationsspectacularlyimproved, vocational andtechnical education (including computerscience) insecondaryschools and madrashas was strengthened, 24 polytechnic institutes, including three forwomen, were established, and implementation of aproject for establishing vocationalschoolsatupazillashadstarted.

Under the aegis of apublicly fundedbut autonomous Quality Education Foundation,nearly 50 model English medium schools were established in some districts andupazillas, but sadly enough, the present government has withdrawn support on theFoundation.

Bangladeshallocatesabout 2.5% ofits GDP foreducation whichis lowestintheregion.Moreover, nearly 80-90% of the funds are used for salaries, wages and infrastructuredevelopment, leaving very little for teachers training,purchase of learning materials,equipmentandteachingaides. Wesuggestthat futureallocationsshouldbeincreasedandexpendituresrationalizedto addresstheseproblems.


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Public andprivateuniversitieshaveexpandedsignificantly, yetexisting capacitiesallowonly about 4-5% oftheeligibleaspirantsto beablesecureadmissionsto theuniversities.Moreover,thereisnow aseriousshortage of well qualifiedandexperiencedteachers forhigher level teaching and research. With World Bank assistance, my governmentprepared a 20-year strategic plan for expansion and qualitative improvements in

university education. Weexpectadequate fundsto beallocated foritsimplementation ofthisproject. I also proposeallocations foradedicated fund of Tk200 crore foroverseastraining of university teachers. A rigorous selection of awardeesbased on merit andappropriate incentives for their returnupon completion of their higher studiesmustbeensured.

Science Education, Research and Development.Theseaspects oftheeducationsectorhave sufferedbenignneglect,andstudentnumbers insciencesubjectsat thesecondaryand higher secondary schoolshavebeendeclining. Thereareanumber of science andagricultural research institutions which suffer due to insufficient funds for research asmostallocationsareexhausted on salaries and wages. My proposals for this important

sub-sectorofeducationareas follows:y One-percent oftheindustrial GDP shouldbeallocated forimprovingscienceand

technology researchand one-percent oftheagricultural GDP shouldbeallocatedforagricultural researchanddevelopment;

y Establish (strengthen where already existing)Technical Teachers TrainingInstitutesattheDivisional level to improvethequality ofteachersattheupazillaVocational and Technical Institutes,;

y Setupa Tk. 650 crore Academic InnovationFund forimprovinguniversity levelresearchandtraining,and fordevelopment ofspecialized libraries;and

y Allocate funds fordeveloping learner-friendly sciencetext-books,audio-visuals,and for conducting refresher courses for science teachers at the secondary and

higher secondary schools in order to popularize science education belowuniversity levels. I proposeanallocation of Taka 200 crore fortheseactivities.

Inadditionto measuresto improvethequality ofinstructionattheschools, collegesanduniversities, weproposemore effectiveuse of television for thispurpose. A separatechannel in the Bangladesh Television (or via the studios of the Open University)dedicated to the transmission of model instructions (lectures)by reputed scholars andteachers on various subjectsbased on theapproved curriculaand syllabus isproposed.Theseprograms couldalso bereproducedas CDsanddistributedto studentsatmoderatecosts.

Information and Communication Technology.Recognizing the critical importance ofscience,andinformationand communicationtechnology inmeetingthe challenges ofthe

21st century,my governmentestablishedaseparate Ministry of Scienceand Technologyin 2002,and formulateda National ICT policy. ICT wasdesignatedas one of thrustsectorsanda National TaskForce withmyselfasthe Chairperson was formed. In 2006,the Parliamentpassedthe Informationand Communication Technology Act.


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We connected Bangladesh withthe worlds informationhighway throughthesubmarinecable. Variousactivities forhuman resourcedevelopment were carried out through theBangladesh Computer Council. We believe that priority should be given to fasterexpansion ofthe ICT infrastructureanddevelopment ofhumanresources. Inthis context,I amproposingthat (a)the currentzero-duty facilities forall ICT relatedequipmentand

materialsbe continued,andthat (b)public sectorsupportbeprovidedto themany privatesectorICT training centersin orderto improvetheirquality anduniformity.

Health and Family Planning.During 2001-2006, we increased thenumberof beds ingovernment hospitals at different tiers by 6524, provided 285 X-ray machines, 270Ambulances and many other essential equipment, and expanded the facilities forspecialized treatment of cancer, cardiac and kidney diseases, and burn injuries. Wesignificantly increased the number of doctors (2687), nurses (2000), health assistants(3000),andupazila family planning officers. Additionally, we createdposts fornearly16,000 moredoctors,healthassistantsandnurses. The EPI coverageincreased from 52%to 63%. Infantmortality andmaternal deaths were reduced,but the incidence of child

malnutritionandunderweight childrenremainedat 16% and 46%,respectively.

Wemademajorrestructuring ofthe familyplanningprogram, which wasinabadstate ofmanagementand lostits focusduringthe 1996-2001 government. The HealthDirectorateand theFamily PlanningDirectorates weregiven separate responsibilities forprogramimplementation. We restored the door-door delivery of family planning materials andincentivesprograms. These steps restored the lost momentum of the family planningprogram. Ouraim is to bringdownpopulationgrowth rate to 0% within then next tenyears.

I proposethatappropriateprovisionsbemade for (i) increasingthesupply ofpopulationcontrol servicesandmaterials, (ii)programs for furtherreductionsininfantandmaternalmortality, (iii)improvingthestatus of childmalnutritionandunderweight, (iv)expansionofhealthservices coverage fortherural andurbanpoor,and (v) forintroducingahealthinsuranceprogram.

Youth and Women Development.Unemploymentamongthe youth,particularly amongthe educated ones, is creating apool ofpeople who suffer from frustration, and oftenbecome victims of antisocial activities. Their youthful vigor and energy are gettingdissipated and theirpotential contribution to the society and economy are getting lost.Thesolutionto theprobleminthemediumand longterm wouldrequiretheeconomy togrow ata faster rate creatingemployment opportunities foran increasing labormarket,andaneducationsystemthat wouldproducejob orientedskills. To addresstheproblem,weproposethe following:

y Theexisting youthtraining centersshouldbeadequately resourcedandthescopeand content of their training programs should be revamped to develop skillsrequiredby thedomestic and overseasemploymentmarkets. Training in foreignlanguage,asappropriate,shouldbeapart oftheprogram;

y Loansshouldbeprovidedandtrade licenses facilitated forthetrained youthto beableto establishtheirownbusinesses;


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y The unemployed youth shouldbe organized to provide community services onpayment ofstipends/honorariumsprovidedby the local government;and

y Fundsshouldbeprovided for community counselingagainstdruguseand otherantisocial activities,and forpromotingstrong familybondsandrelationship.

Ourproposals forwomensdevelopmentareas follows:y Increase scope and quality of free health services at the government health

facilities,especiallypreandpostnatal services forexpectingmothers;

y Establishgynecological wardsattherural health centers,y Institute special quotas for women at the technical and vocational training

institutes;and

y Introducespecial busservicesandestablishdormitories forworking women;andSocial Safety Net.Duringmy 2001-2006 government, coverageunder thesocial safetynetprogramincreasedsignificantly. In 2001,anestimated 700,000 beneficiariesreceivedatotal sum of Taka 100 crore. In 2006,thetotal numberofbeneficiariesincreasedto 2.8

millionhardcorepoorpeople who receiveda total amount of Taka 600 crore. I proposethat the ongoingprograms shouldbeexpanded to includemore of thehardcorepeopleandper capita allocationbe increasedby 20%. I also propose that in the light ofpastexperiences,targeting ofbeneficiariesshouldbeimproved,allocations foradministrativecostsbeincreasedandeffectivemeasuresto rectify any leakagesand corruptpracticesinthe listinganddistributionshouldprocessshouldbetaken.

I amalso proposingthat inadditionto the oldageallowance,apilotscheme forsettingup a contributory Old Age Pension Fundbe undertaken. Individuals who have non-pensionable incomes, wouldbeeligible to openanaccountagainsthis/herNational IDcard and make periodic deposits to this Fund throughout his/her working life. The

proceeds of theFund will be invested forprofitand theparticipants will bepaidbacktheirentiredepositplusaccruedprofitattheend ofhis orherwork life. I amproposinganallocation of Taka 100 crore forthescheme.

Small and Medium Enterprise Development (SME). Labor intensive small andmedium industries have the potential to provide employment and income alongsideagricultureand large capital intensive industries sectors. SMEs require relatively smallinvestments,uses locally produced raw materials,direct foreign requirements are low,andhavestrongbackward linkages. Experiencesshow that SMEshavenotsignificantlyaffected by the global economic downturn; on the contrary they have thrived andsuccessfully met domestic demand for consumer goods during this crisis. Appropriate

training, readily available technology, supportivepolicies and infrastructure, and easyaccessto credithavethepotential to makethissectorbecomedynamic.Development ofthesegeographically dispersedenterprises will also relievethedemographic pressure onDhakaand othermajorcities.

In consideration oftheabove, I would liketo proposethe following:


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y Job and business oriented training of potential entrepreneurs and technicalpersonnel onmanagement,technology andmarketingshouldbe organized. Suchtraining couldbeplannedatthe various Vocational Technical Institutes;

y Doublethe seedmoney facility at Bangladesh Bankin orderto helpexpandthelendingandrefinancing operations forSMEsby the commercial banksand other

financial intermediaries;y Furtherrelax therate ofinterest forlendingto SME enterprises,andincreasethe

loanrepaymentperiod;

y Giveprioritiesto womenentrepreneurs andy Strengthenresearch onpriority aspects of SME development.

Agricultural Support Services. Althoughagriculturesectors contribution to the GDPhas been declining, its role in ensuring food autarky and production for exports,providing a diverse but nutritionally balanced diet, and generating employment andincome forthebulkofthepopulation livinginrural areas,remainasimportantasbefore.In view ofthedecliningavailability of limitedagricultural lands, continuousincreasesin

theproductivity of fixed and variable resources will be needed to maintain a level ofagricultural productionthat will effectively sustainthe livesand livelihoods ofagrowingpopulation. Additionally, agricultural potentials (crops, livestock and fisheries) of thewetlandsand the vast Haors5need to be fully exploited,albeitwithdue cognizance ofthespecial environmentalprotectionneeds.

Agriculture is the largest private sector in Bangladesh with millions of individualparticipantsguidedby socio-economic rationale. We,therefore,believethatmaintainingareliablesupply ofquality inputs,provision of technical supportservicesandensuringefficientmarketing ofproduceatpricesthattheproducers will considerto beprofitable,wouldbe the only way to increaseproductivity andproduction in thispredominantly

smallholdersubsistenceagriculture. We,therefore,proposethe following:y All fertilizersubsidiesshouldbe furtherincreased;y Quality and potency of imported fertilizers should be strictly monitored, and

local dealers fordistributionshouldbeappointed onthebasis ofrelevantbusinesscredentials,andnotsolely onpolitical considerations,asitisbeingdonenow;

y Subsidies fordiesel-run irrigationshouldbe increased inanamountthatisequalto thedifferenceinthesubsidies fordiesel-runandelectricity rununits;

y Increasedproduction,storageanddistribution ofquality seedshaveto beensured;y Diversification of cropagriculture into highervalue commercial cropsshouldbe

mademoreextensivethroughbettermarketing,storageandprocessing facilities;

y One ormore (asrequired) coldstoragesshouldbeestablishedineachupazilla forperishableagriculturalproduce;

y Procurementprices forcropsshouldbeannouncedtimely,procurementshouldbedirectly fromproducersinsteadmiddlemen/processors,andmalpracticesby partycadreshaveto beprevented;and

5 Low lyingareasthatareunderwaterduringmonsoonsdueto impededdrainagebutare cultivableduringdry season.


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y Supportservicesandincentivesstructure forincreasingtheproductionandsupplyof fish,poultry,eggs,meatandmilk in order to address theproblem of Protein-Energy-Malnutrition (PEM)amongthepopulationhaveto bestrengthened.

In order to encourage theproduction ofprotein foods, we recommend thatappropriate

tradeand tariffpoliciesbe instituted to protect thedomestic producers from the Indianimports (through formal and informal trade). We also propose that rearing of milchbuffaloes in suitable agro-climatic zones of the country be encouraged throughappropriateincentivesandtechnical supportservices.

Land Use Planning and Development of Rural Settlements. Theavailability of ourvery limited agricultural lands isdiminishing at a rate ofabout 1% per annum due tourbanization,physical infrastructure and industrial development, construction ofbrickfieldsand othernon-agricultural uses. Whilethesearenormal features ofanagriculturaleconomy in transformation, Bangladeshs special circumstances warrant plannedmeasures formitigation ofpotentially adverseeffects onthe livesand livelihood ofrural

andperi-urbanpopulation. Weproposethe following:y Anagricultural andrural landuseplanningbody shouldbesetup withexperts

onthissubjectand powersto delineateanddesignateareasthatshall notbeputto any use other than agricultural production (crop, livestock, poultry andfisheries);

y A pilotproject, withanallocation of Taka 250 crore,be initiated forplanneddevelopment ofrural settlements onnon-agricultural landsasdeterminedby theabovementioned landuseplanningbody. The settlements will haveprivatelyand orcommunally ownedmultistoriedhousing (financedby loansthroughthebanking system),publicly providedbasic social and economic services, andprivatelyprovided otheramenities of life. These clusters wouldalso beideal for

installingalternativesources ofrenewableenergy,suchsolar,bio-gasand wind,and would be a much more effective option for their demonstration anddisseminationthaninstallingthem on largepublic buildingsinDhaka.

Preservation and Optimum Use ofPublic lands, Water Bodies and Forests.

A largeportion ofpublicly owned lands, waterbodiesand forestareasarenow illegallyoccupiedandused for incomeby theso-called landgrabbers. Extraction ofsand fromriverbedsisimpedingnatural flows of water,thereby leadingto erosionanddestructionofriverbanks. Total denudation of forest lands,uncontrolled fishingin waterbodies,anddraining out of wet lands are resulting in resource depletion as well asdestruction ofenvironmentandbio-diversity. I proposethatthe laws ofthe landshouldbeappliedto its

fullest extent to evict illegal occupants of suchpublic resources, and consider leasingthese out to landless laborers, fishermen,marginal farmers,destitute womenand othervulnerablesegments ofthepopulation. Secondly,a longtermpolicy andstrategy shouldbe formulated fortheprotection, conservationandefficientuse oftheseresources

Agricultural Insurance. I amproposing agricultural insurance to support marginalfarmers mitigate the risks ofproduction failure due to weather or any other factorsbeyondtheircontrol inthe following fields:


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y Crop Insurancey Fisheriesandpoultry Insurancey LivestockInsurance

An Agricultural Insurance Company withprivateandpublic sectorsparticipationandaninitial subvention orequity participationby thegovernmentmay beestablishedassoon

aspossible. Anallocation of Taka 100 croremay bemadeinthe comingbudget forthispurpose.

Challenges of Global Warming and Climate Change. Bangladesh is one ofthemostvulnerable countries to suffer from the likely adverse effects of global warming andclimate change. Some two crorepeopleand the floraand fauna in the coastal and lowlyingareas will beadversely affecteddueto inundationby sea water,salt waterintrusion,scarcity of drinking water and soil salinity. This will affect the agro-ecology, eco-systems,biodiversity,humanhabitationand livelihood.

Intheabsence ofashort,mediumand longtermstrategic planto mitigatetheeffects of

thepredicted climate change,ad-hoc arrangements likethe creation ofa Climate ChangeFund, is going to be nothing more than tokenism. We would like to propose thefollowing:

y An integrated strategic plan of action dealing with land reclamation,problemsintrusion of surface and subsurface salinity, strengthening and increasing theheights of the coastal embankments and their afforestation shouldbepreparedwithinputs from world-classexperts;

y Priority research fordeveloping salt tolerant varieties ofagricultural crops,andarrangements forproductionandmultiplicationseeds/cultivars forsuch varieties;

y Training of extension agents and farmers on crop and livestock productiontechnologiesandhusbandrypracticesunderconditions ofsoil salinity;and

y Raising awareness of the people on community action for the continuousmaintenance and repair of embankments, dykes, cross dams, roads drainagestructures,as well asmaintenance of forestryplantations.

Intheabove contextitmay also benotedthatthe construction oftheFarakkabarragebyIndia on the river Ganges 35 years ago, has already inflicted upon some 30 millioninhabitants in Southand South -Westernregion of Bangladesh thesame calamities thatthe international communitiesarepredictingdue to likely climate changes 30-40 yearsdown theroad. Theproposed Tipaimukhdamandbarrage in the North Easternstate ofMonipurisgoingto createthesameunmitigateddisasterforhuman livesandecosystemsinthe Meghna-Kushiarabasinin lowerriparian Bangladesh.

Cyclone Aila and Disaster Management: Nothingepitomizesmore theadministrativeincompetence inherent in this government than the currentplight of the cyclone Ailavictims. The inhabitantsare livingundersub-human conditions ofimmenseproportions.They are virtually prisoners in pockets that are inundated by saline water. Manydwellings still remain flooded inside. Peoplebathe and wash in the waterpollutedbyhuman and animal excreta. Women and children have to travel far on rafts to fetchdrinking water. Thereareno efforts to rehabilitateand strengthen costal embankments,


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resulting in further damage to the structures by wave action. It is alleged by theinhabitants thatreliefand rehabilitationactivitieshavebeenstalleddue to infighting ofthe ruling party political activists in the area. We request the government to takemeasures forremovingtheimpedimentsto implementation ofthereliefandrehabilitationactivities.

Wepropose that special allocationsbe made in the comingbudget for constructing/rehabilitating/strengthening the drainage structures and protective embankments,providingmaterials for constructing/repairing ofdamagedhouseholds,and for revivingagricultural developmentactivities.

Water Resources Management. Overall water demand in Bangladesh has beenincreasingdue to populationgrowth,urbanization,development of irrigatedagriculture,fisheries,industrializationetc. However,availability ofsurfaceandsub-surface waterhasbeen dwindling. Vast expansion of tube well irrigation has led a serious depletion ofaquifer. Against this background, it is important that a multimodal water resource

managementplanispreparedto ensureadequateprovision ofsafedrinking waterfortheurban, peri-urban and rural population, and for meeting the needs of agricultural,livestockand fisheriesproduction. Webelievethateffortsshouldbegearedto:

y Harnessand conserveall availablesurface water through construction of controlstructuresandreservoirsto storeexcess waterduring floodingandmonsoons;

y Deepening rivers, rivulets, canals and other water bodies to increase theircapacities forwaterstorageduringmonsoons;

y Disseminatingavailable technologies forrainwaterrecharge ofaquifers inurbanas well asrural areas;

y Dissemination ofavailabletechnologies forrainwaterharvestingand conservationby familiesas well asgroups;

y Greaterutilization ofnearby riverwaters forurbandrinking watersupply throughinstallingproperfiltrationandpurificationsystems;andy Fostering regional cooperation between Bhutan, China, India and Nepal for

planned augmentation of water in the Ganges-Brahmaputra and in the Surma-Kushiara-Meghnariverbasins.

Roads, Railways and Inland Water Transport Development. Inadensely populatedcountry like Bangladesh,thereisno betteralternativethanto developa well designedandintegrated multi-modal transport system comprising of railways, roads and waterways.Despite major expansions of the road network, it has been rendered inadequate andinefficientby aneverincreasing volume ofgoodsandservicestraffic. Majorinter-district

roadsandhighwaysremain clogged with vehiculartraffic,resulting inexpensivedelaysin commutingtimes.

Increasinguse oftheextensiverailwaysnetworkwouldrelievethispressure onroadsaswell as allow faster and cheaper inter-district transportation ofpassengers, goods andservices. But this will require major upgrading and rehabilitation of the centuries oldtracks, increasingandmodernizing the rolling stockand locomotives,betterequipping


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andmodernizing theexisting railway workshopsand,most importantly, improving theoverall management ofthesystem.

Therelativeimportance ofriverinetransporthasdeclined overtimepartly because oftheexpansion ofroadnetwork,andpartly becausemany rivers, their tributariesand canals

havebecome non-navigable due to reduced flow and siltation arising from unilateraldiversion of waterby upstream structures in India. A technically soundprogram ofdredgingsome ofthemajorwaterwaysthat wouldimprove connectivity ofthe waterwaysshouldbeundertaken. Largerivercrafts (launchesandsteamers)play animportantroleinconnecting the metropolitan cities with the south and southwestern districts and somecoastal settlements. Safety of travel by these river crafts are open to question due todeficiencies in their engineering design, and operational problems arising frominexperienced crew, overloading and violation of navigational rules. Theseproblemsneedto beaddressedas well as capabilities fortimely andeffectiveresponseto accidentsonthe waterwaysneedto beimproved.

Urban Transportation Management. Unprecedented traffic congestion in Dhaka anditssuburbshavenot only made civic lifeunbearable, ithasalso imposedeconomic andsocial costs. More time is wasted onpoint-to-travel than inproductiveactivities. Withdilapidated and antiquated vehicles and sub-standard services,public transportation ofacceptable quality and comfort is virtually absent. Hence many travel by private cars,auto rickshaws, ormotorcycles. Roads werenotdesigned to carry this large volume ofmulti-modal traffic.

Sincetheexistingroads cannotbe widened oralternativeroads constructeddueto landconstraintsandunplanned construction ofbuildings,the feasiblesolutions foreasingtheproblem will be to construct elevated roadways, monorails, circular railways, anddeveloping a vastly improvedpublic transport system including fast commuter trainsconnectingDhaka with cities withina fifty milesradius. Wealso initiateda circularwaterways foreasingthepressure onroads. Thismay made fully operational.

Developingself containedsatellitetowns,de-concentratinggovernment offices fromtheirexisting locations,introducingschool andhospital zoningsystem,aresome ofthepolicyandinstitutional measuresthat canalso be considered overthemediumand longterm.

The Police Force. Anhonestandefficientpolice forceisasin qua non forensuringruleof law and improving the internal law and order situation. In Bangladesh, the ratio ofpoliceandtotalpopulationisabysmally low. They haveto workunderextremely difficultconditionsand for longhours. My previousgovernment increasedthesize ofthe Policeforce and also equipped them with new vehicles, equipments and better arms andammunitions. Moreneedsto bedone forupgradingandmodernizingthe Police force.Weproposethatthebudgetshouldprovide for

y Recruitment ofadditional policepersonnel at all levels to improve the ratio ofpoliceto totalpopulation;

y Expansion and upgrading of thephysical facilities and training services at thePolice Training Academy andpolicetraining centers;


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y Modernizing the scope and content of the training programs with greateremphasis on issues relating to the socio-cultural aspects, conflict resolutionandhumanand citizensrights;

y Improvingthequality andquantity ofrationsand living conditions;andy Providing an adequate complement of logistic support including vehicles, arms

andammunitions,and communicationequipment.

Most importantly, I would urge the government to provide an enabling environment

for the police to work without any undue political interference or intimidation in

discharging their duties.

The Armed Forces.The ArmedForces of Bangladeshmustbe suitably expandedandstrengthened to be an effective deterrent against any assault on national security,sovereignty andterritorial integrity of Bangladesh. Eachandevery branch ofthe ArmedForcesmustbeequipped withmodernarmsandarmaments. The irreparableand tragiclossinflictedby the BDRuprising,haveto berecoupedby anacceleratedandexpanded

program for recruitmentand training. Each and every individual has to be trainedandmotivated to be a valiant soldier and anuncompromisingpatriot. The capabilities andskills oftheintelligenceapparatusandpersonnel mustbe vastly strengthenedto forestallany subversiveactivitiesagainstthearmed forces. In view ofthesignificant importanceof the maritime boundaries of Bangladesh, from thepoint of territorial security andprotection of off shore resources, immediate steps mustbe taken to put inplace a tri-modal naval defensesystem.

Bangladesh Rifles.The incomprehensibleand tragic failure of thisgovernment to dealwith the BDR uprising swiftly and decisively will remain as a dark chapter in thecontemporary history ofthis country. Intheaftermath oftheuprising,there wasnothing

left ofbordersecurity worthy of itsname. Quickreorganization ofthe BDRto restoreitto itspreviousglory andeffectivenesshasbecomeanurgent imperative in view of theunhindered smuggling of goods, drugs, alcohol, arms and ammunition, together withillegal and reckless activities of the Indian Border Security Forces. Bangladeshis havebeenindiscriminately killedby BSFduringthe last 17 months ofthisgovernment.. Thegovernmenthas failedto takeany effectivemeasuresto protectthe livesandproperties oftheinhabitants otherthanaskingthemnotto tread within fivekm oftheborderatnight.

Broad Guidelines for Rationalization of Taxation policies. Bangladeshhas one ofthelowest Tax-GDP ratio, whichneeds to be increased to generateadditional public sectorresources. However, webelieve that a rational taxationpolicy wouldbe one that will

encourage taxpayers to pay taxes rather than avoidance. Moreover, the governmentsobjective shouldbe to increase the total proceeds of tax revenueandnot to encourageavoidancethroughahightax rate. We would liketo proposeas follows:

y Instead of increasing tax rates, performance of tax administration should beimproved to increase collection at prevailing rates. If necessary, taxadministrationshouldexpandedand/orrestructured;


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y In view ofthepresentinflationary pressuresanderosion ofpurchasingpowerofthe commonpeople, I amproposing that forpersonal income tax purposes,anannual incomeupto Taka 2,40,000 shouldbemadetax exempt;

y Forwomentaxpayerstheexemption limit shouldbe fixedat Taka 2,70,000,andfor individuals withany disability,pensionersand oldpeopleshouldbehavean

exemption limit of Taka 3,00,000;y Tax deduction at source for Savings Certificates, 5-year Savings Bond and

Bangladesh Savings Bondsshouldbe withdrawn;

y Imposition ofany new taxes on ICT relatedgoodsshouldbeavoided;y Prevailing taxes on textbooks, reference books, educational, scientific and

researchjournalsandperiodicalsshouldbe withdrawn.

y An Investment Bond should be issued for foreign currency earnings ofBangladeshis living abroad as well as foreign nationals of Bangladeshi origin.Proceeds of the Bond may be invested in important national developmentprojects.

y More transparency and accountability shouldbe ensured for the utilization ofblockgrantsandany otheropenendedallocations.

Our Vision for a Peoples Bangladesh

Against all odds, the valiant freedom fighters and thepeople of this country foughtalongsidethethenpolitical andmilitary leadershipto createanindependent Bangladesh.Betrayal of the blood, sweat and tears of millions during the early years afterindependence still haunts us as a dark chapter in our history. Today, we stand on theashes of a stifling one party democracy, an authoritarian Presidential form ofgovernment,andthepost-oneelevenunconstitutional usurpergovernment. Establishmentofapluralistdemocracy by President Ziaur Rahman,and thegeneral elections of 1991,

broughtthisnationbackto theideals forwhichmillionssacrificedtheir livesinthe 1971warof liberation ---democracy, freedom,dignity andprosperity.

Our dream and vision for the future, therefore, is a globally integrated andenvironmentally sustainable Bangladesh that will be free from hunger, malnutrition,illiteracy,social injustice, violation ofhumanrights,exploitation ofmany by aprivilegedfew,discriminationbased onreligion,ethnicity, cultural heritage oronany othergrounds,andaBangladesh that will have a rightful place of honor and dignity in the globalcommunity within this coming decade. To fulfill thisdreamand vision:

WE envision the protection and consolidation of a multiparty democracy in its

truest sense throughirrevocableguarantees fory Elections to the Parliament and other elective bodies with unquestioned

credibility andbeyondany reasonabledoubt ofpartisaninterferences;

y A Parliament that will function as per the norms of civility, parliamentarypracticesandaccountability to thepeople;

y Anindependent,efficientandincorruptiblejudicial systemunfetteredbypoliticaland/orvestedgroupinterests;

y Theprotection ofhumanrightsandthedoctrine ofequality ofall before law;and


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y Anindependentandimpartial Election Commission, free frompolitical,partisanorany otherinterferences orinfluences

WE envision an economic management and policy regime that will position

Bangladesh, by 2015, on a fast track for transition into the ranks of a middle income

country throughy Usingprivate entrepreneurship, initiatives and innovativeness in a competitive

environmentastheprimary engine ofgrowth;

y Significant increases in theproduction,diversificationand commercialization oftheagriculture sector to maintain foodautarky,provideadiverseandnutritiousdiet,and contributeto foreignexchangeearnings;

y Higheranddiversifiedgrowth in themanufacturingsectorto meetdomestic andexportdemands;

y Broad based income and employment generation for reducing poverty at anannual rate of over2% perannum;and

y An expanded safety net for the vulnerable and disadvantaged segments of thepopulation

WEenvision ahuman resources development policy that will

y Removeilliteracy withinthenextdecade;y Removeany social, cultural,genderandeconomic barriersto accessto education

atall levels;

y Ensure access to appropriate education for the physically, mentally andemotionally challenged;

y Develophumanresourcesatall levels with theskillsand competenciesrequiredfor the domestic as well the global job market, imbued with social skills,patriotismanduniversal moral values;

y Instill amongthestudentsandteachersthe imperatives foran inclusive,humane,tolerant,justandequitablesociety;

WE envisiona health and family welfare policythat will

y Provideincentivesandmaterial support forbringingdownthepopulationgrowthrateto zero duringthenextdecade;

y Improve the scope, coverage and quality of preventive and curative healthservices,particularly to thepooranddisadvantagedsegments of thepopulation,andthereby makeitanation ofhealthypeople;

y Improve childandmaternal health services to further reduce childandmaternalmortality ratesandtheincidence of childmalnutritionandunderweight;

WEenvisiona public administration distinguishedby

y Itsprofessionalism,honesty and commitmentto theservice ofthe Republic anditspeople;

y Transparency, accountability and freedom from any political and/or partisaninfluencesinits functioning;

y Extensiveusee-governance,e-commerce;


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y An independent Anti Corruption Commission,unfetteredby any political and orpartisaninfluencesasthenationhad witnessedduringthepost-oneelevenperiod;

y A well equipped, trained and provisioned police force with high levels ofintegrity andimpartiality;

WE envision an Armed Forces that willy Distinguish themselves with the highest levels ofprofessionalism at home and

abroad;and

y Zealously protectthe territorial integrity,sovereignty,national resourcesand thepeople of Bangladesh fromall kinds ofexternal threats.

Above all, we envision a Bangladesh that will always stand upright and put above

everything else its national interests and pride, territorial integrity, and sovereign

equality in building its relationship with other countries in the region as well as with

those across the seven seas.

My fellow Countrymen, let usput our head, heart and soul together in the relentlesspursuit of ourdreamand vision fora Bangladeshas I have outlinedabove.

Allah HafezBangladesh Zindabad

Dhaka 7th June, 2010

begum zia state of the economy. 2010

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