Finance Minister SAMS Kibria and one of his advisors are at loggerheads over the recent performance of the national economy.
Reacting sharply to claims of a poor economic situation made at the Prime Minister's question-answer programme on the BTV last week, the finance minister dismissed the dismal portrayal of the economy.
In a letter to Prime Minister Sheikh Hasina recently. Kibria termed confusing the observations made by economist Dr
Debapriya Bhattacharya, who is also his adviser.
When contacted. Dr Bhattacharya however stood by his observations based on Bangladesh Bank statistics and gave a detailed picture of the situation.
"It was not my intention to Eut up details of mere statistics, ut 1 wanted to highlight the recent economic depression in the country." he said. "Debating on statistics is counter productive. It is rather wise to act to find ways out of the depression."
The finance minister in his letter addressed five of the Is-
sues raised at the TV programme by Dr Bhattacharya, who is also executive director of the Centre for Policy Dialogue.
On Industrial credit How, the minister contradicted Bhattacharya's remark that it has declined in the first six months of this fiscal year. According to Kibria. term-loan flow has rather increased by six per cent during July-September period of the current fiscal year. During the period. term-loans stood at Tk 277 crore against Tk 256.67 crore of the correspondIng period last fiscal year.
Opposing Bhattacharya's view that Industrial production has declined by 1 1 per cent in the first four months of this fiscal year. Kibria said It has rather increased by 5.23 per cent. During the first four months of fiscal 1998-99. the industrial indices stood at 196.93. which increased to 207.23 this year. The minister observed that the confusion was created as Bhattacharya com pared June. 1999 indices (226.62) with that of October. 1999(199 68)
About ADP Implementation. Ihr minister said during the Ursi three months of this fiscal year. Tk 1727 crore was utilised against the target of Tk 2723 crore, indicating that 63 per cent of the target was achieved.
About Bhattacharya's remark that hardly any foreign direct Investment (FDI) came to the country during the first four to five months of this fiscal year. Kibna said the FDI figures for this year arc still not available. However, a major portion of the FDI projects which were in the pipeline last year will be Implemented this year.
On the government s borrowing. the minister contradicted Bhattacharya's figures. The economist had claimed that the government borrowings Increased by Tk 4000 crore. But the minister said during July-December. 1999. the government borrowed Tk 2508 crore against Tk 469.30 crore during the same period last year. So. the borrowing increased by Tk 2038 crore.
Bhattacharya however stood by his figures and gave a detailed explanation.
According to him. term-lending in the first quarter of this fiscal year was Tk 272 crore.
"If this trend continues, the lending would stand at Tk 594.20 crore during the first six months of the current fiscal year. 10 per cent below Tk 603.99 crore lending during the same period of last fiscal year," he said.
"But last year was a flood year and the first quarter of 1998-99 is not comparable with this year. It should have rather Increased this year."
About industrial production. Bhattacharya said the claim of 5.2 per cent growth this year is not meaningful as floods hit production last year. "The in-dlce was 223.68 in June, 1999. which declined steadily to 199.80 in October. 1999 This reflects an 11 per cent decline."
About ADP implementation, he said the finance minister's own figures show a 37 pier cent shortfall. "I rather quoted a lesser shortfall figure." he said.
On FDI. the economist said that during fiscal 1998-99. the
net FDI How (Direct, portfolio and EPZ Investment) was 26 21 crore which was 18.03 per cent lower than that In the previous year "The total FDI figures for this year are not available till now But up to October. It was less than one crore dollars in the EPZs This la about one seventh of the FDI in EPZs last year Had it been one third of last year's figure, we could call it satisfactory."
About government borrow Ing. Bhattacharya said balance of the total borrowing in De cernber, 1998 was Tk 9741 30 crore, which stood at Tk 13797 crore In December. 1999. showing a Tk 4000 crore Increase “This comparison was made to assess the revenue Implication of flood in 1998 vis-a-vis this year."