Akhaura-Agartala Rail Project Attaining Base

The ball has started rolling in favour of the historic India-Bangladesh rail connectivity with the Railway Ministry contemplating to undertake topological survey for the extension work. The alignment for the proposed Akhaura (Bangladesh) to Agartala (India) has already been accepted by the Bangladesh Government, the Assam Assembly was informed on March 30, 2011, according to a report in The Assam Tribune.

The report also said, an amount of Rs 251 crore will be spent for commissioning the Indo-Bangla rail link and the project will be financed by the Ministry of External Affairs (MEA) of India and DoNER, said Industries and Commerce Minister Jitendra Chowdhury in reply to the Assembly.

He said that the project is expected to get implemented within the next three to four years. The General Manager of Northeast Frontier Railway (NFR), Construction had visited Akhaura to oversee the alignment of the dream railway project.

Chowdhury informed the House that the Bangladesh Government is also seriously thinking of finalising a modality to allow India, Nepal and Bhutan to use Chittagong Sea Port. It may be noted that Chief Minister Manik Sarkar had urged the Bangaldesh Prime Minister Sheikh Hasina to allow Tripura to use Chittagong Port during his visit to Dhaka in March last year. The issue also came up for discussion during the visit of Bangladesh Foreign Minister Dr Dipu Moni during his visit to Agartala in November last year.

On setting up of a bridge on river Feni, he said that a joint team had already visited the proposed site and an organisation has been asked to prepare a detailed project report at the earliest.

The bridge would connect Sabroom in South district with Bangladesh’s Ramgarh directly ushering a wide opportunity for bilateral trade. As part of goodwill gesture, the State Government would bear expenditure for setting up the bridge.

He further said the re-opening of waterway between Tripura and Bangladesh is also under active consideration of the Ministry of Shipping. The Centre has already incorporated it in the Northeast Vision 2020.

Bangladesh-Tripura Trade to Double than Last Year

Business between Tripura and Bangladesh was recored at Indian Rupee 300 Crore in the current fiscal as against Rs 163 Crore in 2009-10, while export of eight items registered a five fold increase this year, according to Central Chronicle report.

According to Tripura Commerce Minister Jitendra Chowdhury, in 2007-08 the export business of Tripura with Bangladesh was recorded at Rs 1.51 Crore and next two years it reduced to only Rs 32 Lakh and Rs 42 Lakh respectively but in 2009-10 it increased five fold to Rs two Crore.

The import business of seven items from Bangladesh has increased over the years, Mr Chowdhury said, adding that in 2010-11 Tripura imported goods of amounting Rs 294 Crore from Bangladesh, which was Rs 163 Crore in 2009-10, Rs 129 Crore in 2008-09 and Rs 84 Crore in 2007-08.

''The highest amount was spent for importing cement followed by small fish, broken stone and Hilsa fish, while the highest amount of export earnings was recorded from vulcanised rubber thread followed by heat resistant latex rubber thread and craft paper and paper board,'' Mr Chowdhury stated.

Tripura also exported flat rolled products of iron, woven fabrics of synthetic filament, raw hides and skin of bovine, dry fish and citrus fruits and imported bricks, flavour drinks and float glass besides, major import items.

He however, pointed out that the Union Home Ministry was considering the proposals of starting border huts to boost border trade between Tripura and Bangladesh, while launching of flight service on Agartala-Dhaka-Chittagong route was also on active consideration of the Ministry of Civil Aviation. To enhance the connectivity, both sides have already finalised the alignment of Agartala-Akhaura railway link and technical survey would begin soon.

The Ministry of External Affairs would spent Rs 146 Crore for track laying work in Bangladesh side and Rs 105 Crore would be spent by DoNER for construction in Indian side, he added.

Bangladesh Economic Freedom Score 53 in 2011 Index

Bangladesh's score is 53, making its economy the 130th freest in the 2011 Index of Economic Freedom. The Wall Street Journal and The Heritage Foundation, Washington's preeminent think tank, have tracked the march of economic freedom around the world with the influential Index of Economic Freedom.

The Economic Freedom Index covers 10 freedoms from property rights to entrepreneurship in 183 countries. Since 1995, the Index has brought Smith's theories about liberty, prosperity and economic freedom to life by creating 10 benchmarks that gauge the economic success of 183 countries around the world. With its user-friendly format, readers can see how 18th century theories on prosperity and economic freedom are realities in the 21st century.

Bangladesh's overall score is 1.9 points better than last year, mainly reflecting improvements in business freedom and investment freedom. Bangladesh is ranked 27th out of 41 countries in the Asia–Pacific region. Bangladesh’s economy remains overly dependent on agriculture, which accounts for almost 20 percent of GDP and employs more than half of the labor force. State-owned enterprises are a significant presence in most productive sectors, including those that are usually dominated by the private sector in other economies.

The Ten Economic Freedom Scores of Bangladesh:

Economic Freedom	Score	Avg. Score
Business Freedom	65.0	64.3
Trade Freedom	58.0	74.8
Fiscal Freedom	72.7	76.3
Government Spending	92.4	63.9
Monetary Freedom	68.6	73.4
Investment Freedom	55.0	50.2
Financial Freedom	20.0	48.5
Freedom From Curruption	24.0	40.5
Labor Freedom	54.3	61.5

Top Ten Investing Countries as FDI in Bangladesh

United Arab Emirates, Kingdom of Saudi Arabia , United Kingdom are the top investor in Bangladesh from 1977 to 2010, according to FDI statistics of Board of Investment (BOI) of Bangladesh. Foreign Direct Investment (FDI) is an investment involving a long-term relationship and reflecting a lasting interest and control by a resident entity in one economy in an enterprise resident in another economy. FDI Components are the equity capital as direct investor's purchase of shares of an enterprise in another country, intra company loans as debt transactions between parent enterprises and affiliates and reinvested earnings as direct investor's share of profits not distributed as dividend or remitted to it which is reinvested.

The top 10 investing countries in terms of investment amount from 1977 to 2010 are as follows:

Country	No of Units	Investment in (USD millions)	Employment opportunities (in person)
United Arab Emirates	6	2229.898	6,513
Kingdom of Saudi Arabia (KSA)	4	1850.406	2,154
United Kingdom	45	952.035	26,194
United States	23	735.376	3,881
The Netherlands	7	351.197	595
Egypt	2	177.149	243
Malaysia	7	162.006	833
South Korea	88	123.708	46,089
India	43	93.803	7,982
China	54	55.622	7,071

Board of Investment (BOI) of Bangladesh is the principal investment promotion agency engaged mainly in investment promotion, facilitation, and policy advocacy support for the policy makers. BOI has endeavored in to portray a brief on Foreign Investment registered from 1977 to 2010 for Joint venture investment and from 1990-2010 for the 100% foreign investment projects. FDI in Bangladesh mainly comprise 100% foreign owned investment and Joint venture between a Bangladeshi investor and a foreign investor. The investment comes in the form of equity, borrowings and reinvested earnings of the existing projects.

First Phase of 18th UP Election Going On Peacefully

Elections to Union Parishads (UP), the lowest tier of local government system, are going on peacefully in 190 unions of 24 upazilas in 12 coastal districts of Chittagong, Khulna and Barisal divisions on Tuesday, 29 March, 2011. Polling taking place in 190Union Parishads of 24 upazilas under 11 districts. According to the decision of the Election Commission, in the first phase, elections were scheduled to be held in 594 of the total 4,505 Union Parishads in the coastal belt from March 29 to April 3, 2011. But the this figure has come down to 568 till 27 March as elections in three Union parishads of Patharghata upazila under Barguna district have been postponed on the day due to widespread violence while elections were earlier postponed in 26 Union Parishads for different leagal complications including fault in the voter list.

The countrywide elections to Union Parishads, an important tier of the local government bodies, are being held in the wake of the municipal polls. The term of most of the country's 4500 Union Parishad bodies have expired as elections to over 4000 Union Parishads were held last between January and March 2003. The Election Commission has decided to hold local elections in Union Parishads (UP) across the country in two phases from March to May this year.

The elections to the local government bodies are very important as the role of these bodies is vital in local development under a democratic set up, because these elections ensure direct participation of the grassroots people in the development activities at the lower tier. The holding of elections to the local government bodies have been delayed due to lack of necessary laws. The ordinances issued in this regard by the caretaker government were not enacted as laws by the present Parliament. However, new laws were enacted, but it took time.

While wishing every success of the upcoming Union Parishad election, it should be mentioned that holding countrywide Union Parishad poll is a gigantic task. Yet the election to Union Parishads must be held in an ambience free from muscle power. Use of any sort of force and firearms must be stopped and a congenial atmosphere free from threat, intimation and fear for exercise of the people's voting right ensured to make the elections free and fair.

Meanwhile, for ensuring accountability and transparency of local government bodies including Union Parishads the political commitment of the government is the prime need. The local government bodies have all along been exploited for political purposes by the ruling circles. This has been a wrong and deceptive practice. To strengthen the local government bodies and ensure peoples participation in the development process all local government bodies must be made free from political influence and they must not be used for political purposes by any group. Under all circumstances local government bodies should be allowed to function independently without any interference from anybody or any quarter. The independent character of the local government bodies and their smooth functioning should be strictly ensured to make them functional and effective.

Bangladesh Sent Relief Materials for Japan

Bangladesh sent relief materials mainly medicine for the Japanese tremor and tsunami victims at the morning on 29 March, 2011. An air force transport plane flew for Japan on with essential commodities under prime minister's instructions as a mark of friendship and deep sympathy. On Mar 16, 2011 the director general for health of Bangladesh announced that process of formation of a medical team to be sent to Japan was underway.

SC to Postpone Hearing on Yunus Appeal till April 4

The Supreme Court (SC) of Bangladesh on March 28, 2011 postponed till April 4 the hearing on the appeals filed against the High Court verdict that upheld a Bangladesh Bank order removing Muhammad Yunus from the office of Grameen Bank managing director. The seven-member bench of the Appellate Division headed by Chief Justice ABM Khairul Haque passed the adjournment order as the petitioners did not get the certified copy of the HC verdict.

Nobel Laureate Dr Yunus and nine board members of the microfinance bank on March 9 filed two separate provisional leave to appeal petitions with the apex court seeking a stay on the operation of the verdict and the central bank order. Yunus was unceremoniously relieved of his duties on March 2 through a Bangladesh Bank letter sent to Grameen Bank Chairman Khondoker Muzammel Huq.

The central bank said Yunus failed to seek its approval when he was reappointed as the managing director in 2000, violating one of the statutes of the partly state-owned Grameen Bank.

Bangladesh Government Approves Hajj Policy

The cabinet of Bangladesh Government approved National Hajj Policy and package 2011 fixing Tk 2,39,942 for each Hajji this year in a weekly cabinet meeting, chaired bay Prinme Minister Sheikh Hasina on 28 March, 2011.

A total of 1,20,000 pilgrims, including 15,000 under government management and the rest under private management, will go to Saudi Arabia to perform hajj. This year, each pilgrim going under government management will have to take extra Tk 30,000 with them.

NBR to Automated Taxation System

The National Board of Revenue (NBR) will introduce automated taxation system in all the customs houses to help businesses on cargo clearance and advance declaration of products. The National Board of Revenue is set to start installation of ASYCUDA-world system in all the customs houses in 2011-12 fiscal with the Technical assistance of UNCTAD (United Nations Conference on Trade and Development).

The finance ministry recently held a meeting on taking reform programmes for reducing cost of doing business in the country. The NBR has pledged to introduce the automated system to expedite trade activities. Delay at customs points has been identified as one of the major reasons of high cost of doing business. World Bank and Bangladesh Tariff Commission (BTC) are conducting two separate studies to identify reasons of higher cost of doing business in the country.

Bio-Based Dressing to Cure Faster Acid, Burn Victims

Dr. Azam Ali

A Bangladeshi scientist now living in New Zealand has brought good news for the people with severe wound and similar physical injury from acid attack and fire incident. Dr Azam Ali, senior scientist in the bio-based materials science team at AgResearch’s Lincoln Research Centre, has invented a bio-based wound dressing, which cures severe wound 40 percent faster than any other conventional medicine currently available on the market.

The breakthrough innovation of the Bangladeshi scientist won the globally reputed Bayer Innovation of the Year Award in 2010. His work focuses on utilising and reengineering bio-based materials into various products, notably wound care devices. His innovation of three wound care devices has already obtained FDA, TÜV and CE marking approval. These products are commercialised and are being sold as wound dressings, particularly for chronic wounds, in New Zealand. The products are also approved for use in the USA, EU and Australia. A leading pharmaceutical company from Bangladesh has already contacted the scientist to introduce the new product on the local market.

Dr Azam holds a PhD degree in polymer science and engineering from the University of Science Malaysia and four years postdoctoral experience from the University of North Carolina. Over the last 17 years he has been devoted to research and development activities, and authored more than 37 publications including journal articles and book chapters.

Japan to Delay Providing Credit for Padma Bridge

Padma Bridge, Bangladesh

Japan will delay supply US$400 million to the construction of Padma Bridge as Tokyo plans to scale back overseas aid and mobilize all resources to reconstruction of its quake and tsunami-battered economy. "Japan has formally informed us that it will process Bangladesh's loan package next financial year, which starts from this April," secretary of the Economic Relations Division said to Financial Express.

Japan is Bangladesh's largest bilateral donor. Its loans are hardly tagged with any conditions and the interest rate is very nominal, usually starting from 0.01 per cent. Tokyo joined an international consortium of donors led by the World Bank last year to agree to bankroll the $2.9 billion Padma Multipurpose Bridge after the government sought soft loan from the development partners.

Development lenders World Bank, Asian Development Bank and Islamic Development Bank are three other lenders to the project. World Bank alone has committed to provide $1.2 billion. The government said the bridge would narrow the inequality divide between the country's relatively developed central and eastern zones with the impoverished southern and southeastern districts.

On March 11 the country was hit by a 9.0 degree quake, its worst since 1923, which triggered a 30 feet high tsunami that left a trail of devastations including a meltdown at a nuclear power plant in north-east Japan. The tragedy has killed more than 10,000 with another 15,000 still missing. The World Bank has said the triple disasters would cost the Japanese economy nearly US$235 billion and would take years to reconstruct.

Bangladesh, Bhutan to Mutual Benefit

Bangladesh Prime Minister Sheikh Hasina and Bhutan's King Jigme Khesar Namgyel Wangchuk discussed regional cooperation in generation of electricity and management of waters of common rivers for mutual benefit on March 25, 2011 in Dahaka, reports UNB.
They discussed a new project for generating hydro power through joint collaboration between Bangladesh, Bhutan and India. Bhutan, rich in hydro power, has already signed a project with India for generation of 10,000 MW of electricity by 2020.
On water management, Prime Minister Hasina and King Jigme Khesar stressed four-nation collaboration among Bangladesh, Bhutan, India and Nepal. Briefing reporters after the meeting, Foreign Minister Dipu Moni said that if this cooperation becomes fruitful, "many tensions among us will be diffused and all will be benefited."
The two leaders also discussed increasing trade and commerce and connectivity between Bangladesh and Bhutan. They also discussed cooperation in the pharmaceutical sector as Bangladesh is strong in pharmaceuticals while Bhutan in traditional medicines. Bhutan earlier had proposed to recruit specialist and general physicians from Bangladesh to improve their health sector. Dipu Moni said much progress has been made in this matter, according to UNB
Bhutanese King Jigme Khesar Namgyel Wangchuck on Friday visited Bangabdnhu Memorial Museum and the Liberation War Museum in the city as he passed the second day of his five-day official visit in Bangladesh.
The 31-year-old King paid rich tributes to the Father of the Nation Bangabandhu Sheikh Mujibur Rahman and the freedom fighters of the country, according to BSS.
Bhutan is the first country that gave official recognition to Bangladesh as an independent country on December 3, 1971. King Jigme Khesar started his day's programme with the visit of Bangabandhu Museum, placed wreaths at the portrait of the Father of the Nation, stood in solemn silence for over a minute and saw the picture of Bangabandhu as his eyes were full of deep respect to the great leader.

ADB to Provide $1.04b Soft Loan to Bangladesh

Asian Development Bank (ADB) is presumably to provide US$ 1.04 billion soft loans to Bangladesh for 2011-2012 under its Country Operations Business Plan (COBP) 2011-13. The total will be around US$ 521.37 million each for calendar years 2011 and 2012. It is assumed that allocations for 2013 will be at the same level as for 2012, According to UNB.

The suggested ordinary capital resources (OCR) allocations for 2011-2013, including those for multi-tranche financing facility sub-projects, are $400 million per year. Under the COBP, the ADB will also continue its support for transport, energy and power sectors apart from building local government planning capacity, delivering local services, urban primary healthcare, agriculture and rural development, enhancements to revenue and expenditure management, and financial market development.

ADB will step up support for regional transport connectivity and power exchange. It will also initiate efforts to promote public-private partnerships by supporting institutional development and transactions in key infrastructure sectors. In line with its Country Partnership Strategy (CPS) 2006-2010 priorities, ADB will seek to step up its private sector operations during 2011-2013 in addition to exploring co-financing possibilities with the other development partners.

According to the ADB's COBP, the Manila-based multilateral lending agency is likely to offer a total of US$ 1045 million against six projects under its indicative assistance pipeline for lending products for calendar year of 2011. These are Primary Education Sector Development Programme, Energy Efficiency Improvement Project , Transport Corridors Project, Railway Sector Investment Programme MFF-2, Khulna Water Supply Project and Chittagong Hill Tracts Rural Development Project II.

These are Teaching Quality Improvement Project II, Public-Private Infrastructure Development Facility Project II, Greater Dhaka Sustainable Urban Transport Corridor Project , Sustainable Urban Primary Health SDP II, Financial Sector Development Project and Development of Bank Reform Project.
Under its indicative assistance pipeline for non-lending products (grants) for 2011, ADB is likely to offer US$ 8.2 million against 16 projects of different sectors including education, energy, finance, public sector management, transport and ICT, water supply, other municipal infrastructure and services.

Bangladesh to Generate Over 10000mw Power by 2024

The Information Technology (IT) Adviser to the ruling Awami League (AL) President, Sheikh Hasina, who is also the Prime Minister of Bangladesh, Mr. Sajeeb Wajed, said in Washington since its assumption of office, the present government has taken initiatives to set up 15 government-funded and 19 private power plants, reports UNB, quoting a press release issued by the Bangladesh mission in the US capital and received in Dhaka on Thursday.

Sajeeb Wajed stated this last Wednesday at a meeting organised by the Washington-based, the US Chamber of Commerce, to focus on the Asia Society Report on US-Bangladesh Trade and Investment Relations.

A group of officials, business leaders and academics attended the meeting.

Bangladesh Ambassador to the USA Akramul Quader and Ms. Tami Overby, Vice President (Asia) of the US Chamber of Commerce, also addressed the meeting.

Jack Garrity, Executive Director of Asia Society, Washington, presented the report that also covered an update on important trade and investment statistics.

Sajeeb Wajed said the present government in Bangladesh envisages generating over 10,000 mw of electricity by 2014.

About various measures taken by the government to bring down the cost of doing business in Bangladesh, he said the processes, now being followed for acquiring land for setting up factories and accessing loans to banks, are "much simpler than in the past".

Sajeeb Wajed said the government has "a grand plan" to modernise highways, introduce cargo flights for Biman, and construct a deep sea-port, with all modern facilities, and a new airport with the required cargo facilities.

Addressing the meeting, Ambassador Quader urged the US investors to take advantage of the investment-friendly regime, particularly in the potential and promising sectors such as pharmaceuticals, information technology (IT) and electronics in Bangladesh.

He said it is a welcome sign that Bangladesh's export to the US crossed US$4.0 billion mark in 2010. The export figure could be even higher had there been no tariff burden there in the US market on Bangladesh's main export items, he noted.

The Ambassador said the US is Bangladesh's time-tested friend, while expressing the hope that bilateral relations between the two countries would further deepen in future.

Presenting the updated facts on the scope of doing business in Bangladesh, Jack Garrity mentioned that Bangladesh's investment potential was yet to be fully tapped.

To help overcome the risks involved in an excessive reliance on the performance of one single sector in Bangladesh's export trade, the speakers suggested that Bangladesh should think of developing backward and forward linkages in the readymade garment (RMG) sector and enhancing capacity for growth in other non-traditional sectors like processed food, pharmaceuticals, ship-building, IT and so on.

In response to a question on education sector reforms, Ambassador Quader said the female education in rural Bangladesh, besides being free, also provides for giving cash incentives to the parents of female students to help arrest the trend about drop-outs.

This article is a news of Financial Express on March 25, 2011.

Government Have to Immediate Priority to Education

A nation cannot stir advance without good education, and it can not have a good education without skilled and qualified people working in the education sector. This present government has emphasized technical education. A large number of schools and colleges have no principals, vice-principals, head teachers, assistant head teachers and teachers of some key subjects. Due to the politicization, corruption and the very poor salary structure for teachers, qualified and skilled people can not be attracted to the education sector.

The ruling government declared their commitment to ensuring quality education and promised a separate pay-scale to be given to teachers. But instead, it recently reduced the non-government teachers’ salary, delay in payment is a regular occurrence and it is the very poor salaries the teachers get compared to other countries in the world.

The thousands of teachers, who have been receiving increased salaries for a few months due to the time-scale, are now getting neither the increased salaries nor their previous amount. As they can not survive with the salaries they receive, most of them have to be involved with the business of private tuition, coaching etc, though many don’t like these. Teachers should be given importance through the introduction of a new salary scale while retaining their time-scale.

Micro-Credit Programs to Come Under Strict Investigation

Bangladesh government has decided to strongly monitor micro-credit programmes of non-governmental organisations amid widespread allegations that the NGOs are charging high interest in the name of service charge from the borrowers of small loans, said a government official to the reporters. The cabinet division has called an inter-ministry meeting for March 31, 2011 to work measures to stop NGOs from charging high interests in the name of service charge during micro-credit programme operation, so that the poor people do not lose everything in the process,also added the official.

The move came at a time when the government is facing huge pressure from international communities such as the US government to resolve, through a compromise, the issue of Muhammad Yunus’s removal as managing director of the Grameen Bank, which has about 80 lakh borrowers under its micro-credit programmes.

Non-governmental organisations now need to take licences from the Micro-credit Regulatory Authority for micro-credit programme operation. More than 1,000 NGOs are running such programmes to alleviate poverty. There has been a common allegation that the poor borrowers of small loans sometimes need to sell their belongings and homesteads to pay the micro-credit instalments.

Macro Economic Stability to Affect as Middle East Unrest

A large number of Bangladeshi workers are in foreign countries. Most of them are in Middle East countries where a country after another are going to unrest to get democracy. So, workers from those countries  would return home which already done for Libya. Bangladesh have no enough infrastructure to employ them. As a result, a large number skilled and experienced workers will staying home without work.

Remittances from that workers have emerged as a key driver of economic growth and poverty reduction in Bangladesh and a vital source of foreign exchange and a key contributor to the Bangladesh economy. This volatility in Libya, Bahrain and other Middle East nations will threaten the country's overseas labour market. These nations are the main recruiters of our workers.

Bangladesh need for a contingency plan to offset the fallout of the Middle East unrest to look for new labour markets to spur the growth of remittance.

Bangladesh and Bhutan Bilateral Trade

SQ5V5PWUUBFW Bhutanese King Jigme Khesar Namgyal Wangchuck has arrived Dhaka on March 24, 2011 on a five-day visit in Bangladesh to attend the 40th anniversary of the country’s independence. Relations between Bangladesh and Bhutan developed steadily since 1971. Bhutan recognized Bangladesh on 07 December 1971. Since the inception of Bangladesh, both the countries have been actively engaged in strengthening the bilateral relations through exchange of high level visits.

The following table shows the trade position between of Bangladesh and Bhutan over the last few years:

Year	Imports from Bhutan	Exports to Bhutan	Balance
2004-05	8.59	5.10	(-) 3.49
2005-06	12	1.72	(-) 11.66
2006-07	10	1.40	(-) 8.58
2007-08	13.74	1.35	(-) 12.39
2008-09	12	0.61	(-) 11.39

(In million US dollar) Source: Bangladesh Bank.

While trade volume is still on a modest scale initially, there is potential for rapid expansion based on mutually beneficial complementarities, strong economic growths in both the countries and expected improvements in overland transportation between them. The balance of trade has always been in favor of Bhutan. With the granting of duty free access of some Bhutanese products its export to Bangladesh is expected to further increase. Bangladesh offers quality and competitive products from wider basket of consumer goods, plastic, electrical and electronic products, software, ready-made garments, pharmaceuticals, tea, and light engineering products. The Trade Agreement between the two countries signed during the visit of the Prime Minister of Bangladesh to Bhutan in November 2009 is projected to add momentum to bilateral trade volume. Besides, under SAPTA and SAFTA, there is also large scope for expansion of trade between the two countries. Alongside trade excellent opportunities exist for the entrepreneurs of both the countries to undertake joint ventures in wide ranging manufacturing and service sectors of small and medium scale.

10 Comments About Microcredit: Opinion

Women are waiting for microcredit in rural Area of Bangladesh

Earlier this month, Bangladesh Government removed Mohammad Yunus from the post of Managing Director of Grameen Bank. Yunus went to court against government decision and Yunus has challenged his removal before the Supreme Court. When Yunus make it as a matter of law, US asked Bangladesh Government to find a compromise with microcredit pioneer Muhammad Yunus.

With Yunus Grameen Bank and microcredit become a buzz in media. More comments and questions are raised about this. M.M. Akash, economics columnist, professor of economics at Dhaka University write a column in BDNews24.com as following:

1. I shall begin with an old saying: “If a drop of water falls on a lake, it loses identity, if it falls on lotus it shines, if on a shell it becomes a pearl. The drop is same but company matters.”Microcredit is neither a panacea nor a devil; it all depends on the context! Taken simply, 
2. “Microcredit” is a very old thing — it is a micro sized credit. So it must be financing at least initially only micro activity satisfying micro needs. But human nature is such that as soon as a micro activity and/or micro need is fulfilled he/she will aspire for a larger credit and will try to fulfil richer human needs. The question of graduation from micro to macro is an inherent necessity attached to each microcredit borrower. A constant vulnerability is another essential problem of the microcredit borrower.
3. There is therefore an important failure or limitation of microcredit — it ensures only limited mobility and that mobility is generally non sustainable.
4. The supporters of microcredit claim that micro-macro graduation is possible by reinvestment of the surplus by the micro borrowers. The savings of poor borrowers and interest paid, savings accumulated, etc. actually prove that they do generate surplus.
5. And here lies the bone of contention. It is beyond doubt that the ability to move upward will depend upon how effectively the surplus is used to generate additional income and how that additional income is distributed. This obviously will depend on how the surplus is distributed as well as on the internal capacity of the micro borrower and the external constraints within which he/she has to operate.
6. One school of economists claim that MC manager/social entrepreneurs have taken away the lion’s share of the surplus, enjoying high income, fame and luxury and also maintaining status quo or managing poverty to ensure political stability. At least they fail to stop the increasing relative gap between rich and poor based on unjustified distribution of surplus/income.
7. Another school claims the MC entrepreneurs have saved the poor from further deterioration, from the clutches of the so-called bloodsucker Mohajons. It not only prevented deterioration and maintained status quo, but also increased their income, smoothened their consumption, increased their social capital, human capital, physical capital, and finally made it possible for them to graduate above poverty line. This debate has to be solved on the basis of objective facts.
8. Even if somebody accepts the above positive claims, the question remains “How Much” and more importantly “How much more can be done by proper institutional changes and through proper regulation of the micro credit entrepreneurs.” Then only one begins a proper search for a more effective model of microcredit!
9. Indian model of self help group is naturally the most preferred model for the poor if a minimum management capacity exists among the poor members of the group and also if external political intervention can be checked.. And that is better because by that they become the subject of their life and no more remain a target object in need of so called safety nets! It is ideally a self-owned, self-managed and self-appropriated collective model of “Micro Credit”.
10. NGO models and GB model of micro-credit in our country deals with the micro man but they have generally failed to turn him/her into an independent macro/meso subject. Perhaps the degree of failure in case of GB model is lesser because at least it has legally given De jure ownership of the bank to the micro man!

N.B. Any unauthorised use or reproduction of bdnews24.com content for commercial purposes is strictly prohibited and constitutes copyright infringement liable to legal action.

Bangladesh Bank to Full Automation of CIB

Credit Information Bureau (CIB) of Bangladesh Bank (BB) is going with full automation from April, 2011 and Banks and Financial Institutions can get the mandatory reports on borrowers concerned in a few minutes by a click after logging on to the automated CIB.

The Bangladesh Bank (BB) launched the automation project of its Credit Information Bureau (CIB) on December 6, 2009 aiming at providing credit information in a faster and efficient way. The automated CIB went into trial run in October, 2010. After a long waiting, it is going to be a history next month with the full automation. A credit amounting to a minimum of $725 or Tk 50,000 comes under the provision for the reporting to the CIB, which was set up in August 1992 to improve the credit risk management and reduce default loans. World Bank funded the establishment of the bureau at that time.

BB data show the CIB had a huge backlog of over 60,000 inquiries for credit information in early last year. The central bank under a "crash programme" removed the backlog in June that year, making the information updated. To deal with the problem, the BB appointed SouthAsia Enterprise Development Facility as consultant of the project, funded by UK Department for International Development (DFID), while Italian CRIF was appointed as the vendor to implement the project two years ago.

SDP Finalized to Ensure Safe Water and Sanitation in Bangladesh

Bangladesh Government has finalized Sector Development Plan (SDP) to ensure safe drinking water and sanitation for all by 2025. The Local Government Division (LGD) under the Ministry of Local Government, Rural Development and Cooperatives will implement the project. About US $21 billion investment package for implementing the plan.

This project ensure people's access to safe drinking water having modern supply system and hygienic and quality toilets by next 15 years. The SDP has been prepared by the Policy Support Unit with inputs from major stakeholders from government, NGOs and development partners and with funding from Denmark. The SDP describes the water and sanitation sector in Bangladesh, its institutions and legal framework, financial allocations and plans until 2025 and addresses institutional, economic and social challenges in the sector.

Bangladesh to Build Floating Platform in Bay of Bengal

Bangladesh government has taken a resolution to build a floating platform in the mid-sea of the Bay of Bengal to allow oil tankers to unship petroleum and crude products in an effort to cut soaring cost of oil handling and speed up fuel import, according to the Financial Express news. The state-owned refiner Eastern Refinery Limited (ERL) is going to appoint a German consulting firm to help design, locate and formulate the project for the country's first Single Point Mooring (SPM) in the Bay.

The firm will charge Taka 700 million as fees for its work. The construction of the SPM may cost at least US$200 million to be financed jointly by the Islamic Development Bank (IDB) and the Government of Bangladesh (GoB).  An ERL officials said the SPM will take two years to construct. They have primarily selected the area around the Kutubdia island, situated 70 kilometres west of Chittagong port for possible site of the platform.

ADP Implementation Status is Inadequate at January, 2011

Annual Development Program (ADP) implementation in the budget of fiscal year 2010-11 is not progress up to January as the Finance Minister's budget statement. After 7 month, it is utilized only 32% of Tk. 385 billion.

The development challenge lies in veritable implementation of ADP. In recent years, ADP implementation has always been much lower than its target. The size of ADP has decayed by half in relation to GDP over the years. At the end or start of the fiscal year, government always utter, they should proper utilize the ADP allocation in next budget. In concluding speech on the supplementary budget for the current fiscal year, Finance Minister Abul Mal Abdul Muhith told the ADP implementation in the next budget would be closed to the target. But the consequences are similar at the close of every fiscal year. When revised budget debated and declared, government attempted to expenditure a large percent of the ADP allocation in a short time. From that perspective, government unable to do more on monitoring and evaluation.

ADP Allocation and its Expenditure in First 7 Months (June-January) of Fiscal Year:

Fiscal Year	ADP (Tk. in Billion)	RADP    (Tk. in Billion)	Expenditure        July-January	Expenditure% July-January
2007-08	265.00	225.00	65.2	24.60%
2008-09	256.00	230.00	78.85	30.80%
2009-10	305.00	285.00	106.99	35.07%
2010-11	385.00		126.41	32.83%

Bangladesh Remittance to A Serious Setback

Remittance from the worker is the most important sector for government income which was increasingly in the few last year. But Country's remittance earning that witnessed a balanced trend in recent months might face serious setback in the coming days due to uprising in Libya, which forced many Bangladeshi workers to return home.

According to the Bureau of Manpower, Employment and Training (BMET), about 83,000 Bangladeshi workers in Libya from 1976 to 2009 which was 1% of total overseas employment of Bangladesh. Bangladesh earn remittance from Libya US$ 95,194 million it was 1.33% of total remittance for the same time. 12,000 employees went to Libya in first six months of 2010.

Bangladeshi workers mostly technical and skilled, had been working in Libya. The workers from strife-torn Libya have started returning home and if this continues Bangladesh will be deprived of a substantial amount of remittance. According to Bangladesh Bank report, Bangladesh earn remittance Tk. 10.45 crore in the fiscal year 2009-10 and Tk. 4.76 crore in July-January of the year 2010-11. Bangladesh will loss this amount of remittance if they will not restore their to other country. 

Bangladesh Biman Lost it's Customer

Bangladesh Biman (BB) launched in February 1972 is the flag carrier airline of Bangladesh. Its main hub is at  Shahjalal International Airport in Dhaka. In the decades following its founding, the airline expanded its fleet and destinations, but it is adversely affected by corruption and mishaps. After the rise in fares in January 2011, Biman lost around 50 percent of its passengers on different routes, which prompted the authorities to bring down the fares.

Bangladesh Biman provides international passengers and cargo service to Asia and Europe, as well as major domestic routes. It has air service agreements  with 42 countries which was wholly owned and managed by the Government of Bangladesh and it was transformed into a public limited company by the government in July 2007.

Biman has already incurred a huge loss due to the fare increase in the name of surcharge, while analysts said the airliner will have to bear a long-term consequence for the decision. The airline has suffered heavy financial losses, and has a reputation for poor service because of regular flight cancellations and delays caused by its ageing fleet. For safety reasons, some of Biman's long-haul aircraft have been banned in the United States and the European Union. Annual Hajj flights, transporting non-resident Bangladeshi workers and migrants, and the activities of its subsidiaries, form an important part of the carrier's business.