MONTHLY Bangladesh Economic Update, June 2016
The Unnayan Onneshan (UO), an independent multidisciplinary think-tank states that the proposed budgetary measures for the year of 2016-17 fall flat in addressing the exceptional circumstances of investment stagnation, infrastructural deficit, rising unemployment and escalating inequality amidst institutional fragility
“The budget speech seems to lack providing prudent and farsighted solutions to the current challenges except it earmarks an ambitious target of uplifting private investment of uplifting private investment amidst lack of business confidence,” says the organization in its rapid assessment of the proposed national budget for the FY 2016-17.
The Unnayan Onneshan points out that private investment has been remaining stagnant and has stood at 22.07 percent of GDP in FY 2014-15 and 21.78 percent in FY 2015-16, while increase in public investment from 6.82 percent in FY 2014-15 to 7.6 percent in FY 2015-16 has not succeed to create much needed crowding in of private investment.
Observing the declining trend in national savings, the research organisation finds that total national savings stood at 29.23 percent of GDP in FY 2013-14, 29.02 percent in FY 2014-15, and 30.08 percent in FY 2015-16, and warns that such trend may induce national output to decline.