Public investment needs to be increased urgently to revitalise economy: Wahiduddin
Emphasising that the past regime had taken up less important projects, he said, "We are approving projects based on the context"
To revive the country's economic activities, public investments need to be increased by swiftly putting new projects in motion, Planning Adviser Wahiduddin Mahmud has said.
Besides, the projects awaiting revisions should be promptly reviewed and approved, he told the media after the National Economic Council Executive Committee (Ecnec) meeting today (7 October).
Amid political transitions, many industrial and banking leaders in Bangladesh are gone, stalling private investments, he added. Besides, public investments also have slowed due to the review of projects from past governments.
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"Both public and private investments are not at healthy levels right now, and this has taken a toll on the overall economy," the adviser said. Even small businesses in rural areas are struggling and require a flow of investment to create jobs.
The state of investment in the country is not good, and this was to be expected after a big political changeover, he added.
The adviser said the development budget would need to be reduced to control inflation, but added that excessive cuts could hinder job creation.
At the Ecnec meeting chaired by Chief Adviser Prof Muhammad Yunus, four projects, including two new and two revised, were approved.
Challenges in government projects
At a press conference following the meeting, the planning adviser noted that loan disbursements to the private sector are sluggish.
He said many government projects are currently under review to determine their necessity and planning accuracy.
Projects deemed unnecessary or politically motivated will no longer receive funding unless nearly completed, he added.
This reevaluation process has slowed government spending, contributing to decreased economic activity.
The adviser remarked that even corruption has economic implications. "For example, transporting people to a rally can stimulate the economy."
He acknowledged that while such practice has diminished under the new government, extortion persists, negatively impacting the economy.
The approved projects
A new rail-cum-road bridge project over the Karnaphuli River at Kalurghat in Chattogram was approved, with funding amounting to Tk11,561 crore with a soft loan from Korea.
The bridge will be built beside an existing old bridge to ensure a smooth and uninterrupted communication system between Chattogram and Cox's Bazar. The project aims for completion by December 2030.
The committee also greenlit the "Resilient Urban and Territorial Project," aimed at developing infrastructure at the upazila level, with a loan of Tk5,901 crore from the World Bank.
Regarding the project, the adviser said infrastructure development in municipalities and city corporations surrounding Dhaka is essential to reduce pressure on the city.
Additionally, a revised proposal to increase the budget for the Matarbari Port Development project from Tk17,777 crore to Tk24,381 crore was approved.
This port, with a draft of 18 metres, will accommodate mother vessels of up to 1 lakh tonnes, significantly increasing capacity compared to the current Chattogram Port, which only handles ships of 30,000-35,000 tonnes.
The meeting also sanctioned a revised proposal for upgrading the Elenga-Hatikamrul-Rangpur highway to four lanes, raising the project cost by Tk377 crore to Tk19,056 crore.
The adviser said costs of infrastructure projects will be closely monitored by the current government. Development partners will assist in oversight, and new regulations will be implemented.
Vehicle accountability
The planning adviser announced that the government has decided to assess the number of government vehicles from upazila to central levels, including their usage and longevity.
He said these vehicles should be repurposed for other projects after their initial use to avoid the need for new purchases.
He noted that while many vehicles are associated with each project, their fate post-completion is unclear; some remain with ministries or are transferred to others, leading to instances where officials possess multiple vehicles.
Government-owned vehicles tend to have a shorter lifespan compared to those bought with personal funds. A report on this matter will be submitted soon by the road and bridges adviser.
BBS capabilities
The planning adviser said the Bangladesh Bureau of Statistics (BBS) currently lacks capacity. "This is not a criticism, as many neighbouring and developing countries also struggle with data collection and professional expertise."
He pointed out that India's statistical system, once strong, has declined due to a loss of autonomy.
He added that weaknesses in data collection impact economic growth and inflation assessments can be influenced by political factors.
However, Adviser Mahmud said the BBS operates independently and he will not interfere in its processes. "New policies are being developed to enhance its capabilities, requiring approval from an advisory committee."
