Focus Writing

Habib Adnan

Habib Adnan
1. Bangladesh : Towards a Middle Income Country Opportunities and
Challenges
Bangladesh is now accredited as one of the next 11 emerging economies. Since the
1980s, the country has averaged 5%6% annual gross domestic product growth.

Its per capita income is now 1466 us dollar and foreign investment is nearly $2.23
billion. Women participation in labour force has increased to 41%, literacy rate to
63% while school dropout rate has reduced to 20.4%. There are now 143 schemes of
social safety net. Poverty rate is also on the decline.

This growth was accompanied by a signicant decline in poverty, an increase in

employment, greater access to health and education, and improved basic
infrastructure. As a result, the once poor country is now considered middle income.

The next goal is to reach upper-middle-income country status by 2021. This

ambitious initiative will require annual GDP growth of 7.5%8% and will entail
overcoming signicant obstacles and seizing on new opportunities brought about by
changing global circumstances.

It means our country is experiencing economic boom. Six ongoing mega projects
testify such claim. First of all, with a cost of $2.9 to $3.7 billion, Padma bridge is
expected to open before the end of 2018 Secondly, Metro Rail Project (rail route from
Uttara to Bangladesh bank) will smoothen the communication system within the
capital. Thirdly, Ruppur Nuclear Power Plant will bring about some huge changes in
the national power productivity. Moreover projects like Rampal Power Project, Paira
Deep Sea Port and Matarbari Coal Power Plant will denitely change our economic
condition for better.

Bangladesh is also a leading global exporter of ready-made garment products.

McKinsey recently predicted that apparel exports could gross $36 billion by 2020.
Goldman Sachs highlighted Bangladesh as one of the next 11 emerging economies
and JP Morgan identied it as a Frontier Five regarding the booming economy.

Moreover relations with India and China have opened avenues of cooperation due to
the landmark visits of our prime minister to both these countries. Relationships with
Nepal and Bhutan have considerably been improved.
The government has tackled the chronic power and energy scarcity taking different
short, mid and long-term plants. Now Bangladesh can generate 14980 megawatts
power. The telecom sector, with nearly 100 million cell phone subscribers, has
attracted FDI. Now the number of internet subscribers are 6.36 crore.

Apart from these achievements, Bangladesh has also taken a leading role in the UN
peacekeeping missions to enhance peace, promote dialogue and encourage
cooperation. Bangladesh has become a brand name in UN peacekeeping as a top
contributor participating in more than 51 missions involving 1,21,407 peacekeepers
since 1988. Bangladesh is also the birthplace of microcredit, pioneered by the Nobel
Peace Prize recipient, Professor Muhammad Yunus the founder of Grameen Bank.
The Banks approach has been replicated in more than 100 countries.

About 10 million Bangladeshis are now working overseas in 155 countries. The
reserve of the country has reached 31.7 billion dollars, according to the data
provided by Bangladesh Bank in the last month, because of their remittance.

However Bangladesh has some challenges as well. The political scene during the
last few decades has been full of bitterness, animosity and violence. There is little
energy left for giving constructive views on the national issues in the parliament. We
should not forget that democracy consists of free media, rule of law, transparency of
all government decisions, accountability of the government to the mass people and
independent judiciary. Peaceful co-existence, tolerance and mutual respect are the
basic elements of democracy. And these are also essential for ensuring a booming
economy.

Meanwhile the widening disparity between rich and poor within the country is
shattering the dream of the mass people. According to Bangladesh Economic
Association, 50 percent people are landless, while 6.2 percent families own 40
percent of the total land in the country. It is also mentionable that corruption has
been widespread in the country. Combating corruption is necessary for stimulating
economic growth and social development.

Under such circumstances a few steps may help us to get rid of these problems.
Firstly, the government will have to ensure a stable political situation. Secondly,
experts have opined that information and communications technology (ICT) will be a
crucial sector for economic development in Bangladesh. So Bangladesh has to
focus on service sector through information and communications technology.

Habib Adnan
Thirdly, remittance earning may increase if the government could send more skilled
and trained workers abroad. In that case the overseas employment ministry needs to
be more active in encouraging vocational training.

Finally, Bangladesh must create adequate jobs for its unemployed population to
defeat poverty. Over 2 million labour forces join Bangladesh job market every year.
New job opportunities should be created for them so that they can also contribute to
the economy. In the meantime government will have to encourage local and foreign
investments.

2. Recent Flood In Bangladesh

Flood Forecasting and Warning Centre- FFWC

90 Flood situation monitoring station.

Bangladesh experienced disastrous flooding in 1987, 1988,1998,2004 and 2007.

Three most serious were 1988, 1998,2004

The flood of 1988 was the worst. Two third of the country remained submerged
for nearly 3 months.

The flood of 2017 is more severe than 1988. It is worst in last 40 years.

Flood hits 32 out of 64 districts. Around 8.1 million people affected.

18 rivers were flowing above danger level.

In 1988 water level of jamuna rose to 20.62 metres and it crossed the level last
year to 20.71 metres. But this year water level went up 20.78 metres.

140 people killed and 700000 houses were destroyed. 1000 educational
institutions have been closed.

Nilphamari, Lalmonirhat, Dinajpur, Kurigram, Rajshahi, Rangpur, Manikgonj,

Panchagarh, Gaibandha, Bogra, Jamalpur, Tangail Sunamgonj Sylhet are some of the
affected districtss.

Nearly 100 metres of a dam in manikgonj was washed away

Highway trafc has been severely hampered due to the floods

Rail service in Dinajpur was shut down.

10630 metric tonnes of rice and Tk 31million distributed by the govt.(Disaster

Management Minister)
Source : The daily Star, DhakaTribune, New York Times and website of Red Crescent

3. Banking sector for sustainable growth

Bangladesh's nancial sector is dominated by the banking sector. The dominance of
the banking sector makes the nancial sector vulnerable on the one hand, but
highlights the crucial importance of the sector in resource mobilisation and
economic growth, on the other. The role of the banking sector in accelerating growth
is contingent upon the soundness and depth of the sector. In Bangladesh the
banking sector has travelled through a journey where the sector has experienced
several ups and downs. Reforms measures have been undertaken in an attempt to
improve upon the structural constraints of the sector.

Such measures have been driven by objectives such as: *increasing the capital
adequacy of banks,

streamlining guidelines for rescheduling of various types of loans,

tightening provisions for non-performing loans,

strengthening disclosure requirements and

improving accounting system.

At present, key performance indicators of commercial banks in the country reflect

the poor health of banks. Most banks have not been able to show signicant
improvements on indictors such as :

capital to risk weighted asset,

non-performing loans,

expenditure-income ratio

return on asset,

return on equity, liquid asset and excess liquidity despite several measures taken

Habib Adnan
 by the central bank.

Since large nancial irregularities in Sonali and BASIC banks, monitoring and
inspection of Bangladesh Bank have increased. The central bank has also appointed
observers in 14 banks and nancial institutions, both state-owned and private to
check further deterioration of these banks and supervise closely to improve their
governance.

Protability, measured by return on asset and return on equity, has been negative
for the state-owned banks (SCBs).

For private commercial banks, though these indicators are positive, but very low.

In case of non-performing loans (NPL) similar performance is observed.

Though the share of NPL to total loans in SCBs has slightly declined in 2016 from
2015 the rate is still as high as 21.82%. On the other hand, NPL in private
commercial banks (PCBs) and foreign commercial banks (FCBs) have increased.
Because of high NPL, state-owned banks have to make larger provisions. The
government has to inject capital into these banks to keep them going. Clearly,
implementation of BASEL III requirements that call for capital adequacy ratio to be
raised to 12.5% of their risk-weighted assets by 2019 will be challenging for the
SCBs. As of 2016 capital adequacy ratio of SCBs was only 6.2%.

The advance-deposit ratio has been little over 70% in November 2016 even though
banks are allowed to lend up to 80% of their total deposit.

The incidences as hallmark group,Bangladesh bank heist have affected the

effectiveness of various measures taken to improve the governance of the banking
sector. Flexible measures, including loan rescheduling policy favouring powerful
people and lack of punishment for fraudulence in banks have worsened the
situation.

In view of this there is a need for setting up a commission for the nancial sector.
The commission will scrutinise the overall performance of the sector, assess the
need of customers and the economy, identify the current problems and emerging
challenges and suggest concrete recommendations for prudential banking to be
implemented in the short to medium terms.

Recently, there has been some discussion at the policy level as regards setting up a
'Financial Sector Commission' for the improvement of the sector. The broad terms of
reference of the commission should be to critically assess the problems and
weaknesses of the banking industry in order to nd whether there is any disconnect
between demand of the growing economy and the realities of a back dated nancial
system that is failing to meet the emerging need. On the basis of a comprehensive
scrutiny, the commission will prepare guidelines and make recommendations as
regards automation, risk management, internal control, the role of various players in
banks and other nancial institutions.

In 1998, a Commission on Banking and in 2002, a Banking Reform Committee were

formed to make recommendations for the improvement of the performance of
banks.

The banking sector has achieved considerable success due to the reforms in the
1990s, 2000s and afterwards. However, the sector will have to prepare for the next
generation of global regulatory framework and meet emerging clients' needs.

4. Prospects and challenges of Blue Economy in Bangladesh

The concept of Blue Economy has opened a new horizon for economic development
of the coastal countries through utilizing sea and marine resources at national and
international level. The concept has become a buzzword for sustainable
development particularly in drafting the post-2015 development goals. Estimates
suggest some 30 million Bangladeshi directly depend on oceanic economic
activities like sheries and commercial transportation. Coastal and Island
developing countries have remained at the forefront of this Blue Economy advocacy,
recognizing that the oceans have a major role to play in humanity's future.

Blue Economy conceptualizes oceans as 'Development Spaces' Where spatial

planning integrates conservation, sustainable use, oil and mineral wealth extraction,
bio-prospecting, sustainable energy production and marine transport.

Bangladesh's economy is sea borne to a good extent and with $130 billion GDP the
country's economy stands the 44th. Sovereign rights have been established on more
than 118,000 sq km of maritime territory, 200 nautical miles (NM) of exclusive
economic zone, and 354 NM of continental shelf after positive verdicts in
international courts. In the same way , the verdict with India declared on 7 July 2014
also allowed Bangladesh's sovereign rights on all the living and mineral resources of
the Continental Shelf extending up to 354 nautical miles.

Fundamental principles of Blue Economy:

1. Optimizing the benets received from the development of their marine

environments eg shery agreements, bio prospecting, oil and mineral extraction.

2. Promoting national equity, including gender equality, and in particular the

Habib Adnan
generation of inclusive growth and decent jobs for all.

3. Having their concerns and interests properly reflected in the development of seas
beyond national jurisdiction, including the renement of international governance
mechanisms and their concerns as States proximate to seabed development.

Bay of Bengal partnership:

The Bay of Bengal is the largest bay in the world that forms the north-eastern part of
the Indian Ocean. The foreign minister gave an idea of the collaboration that could
take place and said "it must be based on certain universal principles of
engagement-mutual trust, respect, mutual benets, and equitable sharing of
benets."

The role of marine resources are :

poverty alleviation,

acquiring autarky in food productions,

protecting environmental balance,

facing adverse impacts of climate change and

other economic possibilities are unlimited. But with the potentialities and
possibilities the challenges also accompany. The following may be the
challenges:

Ensuring the sovereignty over the total coastal area.

Maintaining the security over the economic area.

Establishing marine friendly infrastructure for marine tourist.

Protecting the area from the international smugglers and sh pirates.

Maintaining investment friendly environment in the awarded area.

Sustainable use of biodiversity.

Maintaining marine and coastal ecosystems.

Preserving mangrove and sea grass.

Addressing climate change and managing carbon emission.

Maintaining sea level rise and change in ecosystem and temperatures, from
 coral bleaching.

Addressing ocean acidication and blue carbon.

Keeping the sea area free from pollution and marine debris. And

The growing human population, intensication of agriculture.

Potentialities of Blue Economy in Bangladesh:

o Food security:

One billion people in developing countries depend on seafood for their primary
source of protein. Bangladesh can have it now.

o Fisheries:

Globally 350 million jobs are linked to marine sheries, with 90 per cent of shers
living in developing countries. The value of sh traded by developing countries is
estimated at $25 billion, making it their largest single trade item.

o Marine and coastal tourism:

Marine and coastal tourism is of key importance to many developing countries.

Despite the global economic crisis international tourism continued to grow.
International tourist arrivals increased by 4 per cent despite the global economic
crisis and constituted 9 per cent of Global GDP (direct, indirect and induced impact).

o Harvesting power generation:

Researchers have recently completed the rst ocean tests of a system that uses a
so called articial muscle to generate power from the motion of a buoy riding up and
down on the waves.

o Energy from waves:

A new device being developed by the UK-based Checkmate SeaEnergy could help tap
an important portion of this wave power. The device is a long, water-lled rubber
tube closed at both ends. It will be capable of generating one megawatt of power at
about 12 cents (BDT 9.30) a kilowatt-hour, which is competitive with electricity costs
from other wave-power technologies.

o Shipping and port facilities:

Eighty per cent of global trade by volume, and over 70 per cent by value, is carried by
sea and handled by ports worldwide. For developing countries these percentages are
typically higher. World seaborne trade grew by 4 per cent in 2010 despite the
economic recession.

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o

o Biotechnology:

The global market for marine biotechnology products and processes is currently
estimated at $2.8 billion by 2017.

o Submarine mining & exploration of oil and gas:

The world is gearing up for the exploration and exploitation of mineral deposits on
and beneath the seafloor.The primary assessment indicates few trillion gas in a few
zones available within our premises.

o Port tax or levy:

At present, around 600 ships arrive in Bangladesh per year and anchor in the ports of
Chittagong and Mongla. With this new opening of Blue Economy, obviously, a huge
number of ships will anchor in the ports of Bangladesh, and earning from this sector
is likely to increase tremendously.

Steps to be taken

The prime minister said steps have been taken to strengthen Bangladesh Navy and
Coast Guards to resist illegal use of animal and mineral resources in the exclusive
economic zone as well as to keep international sea line open and safeguard the free
movement of commercial ships.

Coordination agency is to be established. Bangladesh Navy must be able to

coordinate with other maritime forces, which include coast guards and other
government agencies charged with sovereignty, security, law enforcement and
constabulary functions at sea.

Given the current global and regional security environment comprehensive

maritime security is required. It includes Bangladesh ports, shipping, shing,
off-shore oil and gas facilities and shipping lanes in Bangladesh water.

Maritime space belonging to Bangladesh has to be secured from military and

non-military threats.

Besides national efforts, regional or global cooperation is also necessary to ensure

maritime security, in particular against transnational non-maritime security, in
particular against transnational non-military threats.

Blue economy is a relatively new jargon in Bangladesh but very common in global
economy even in Indonesia. This is a hope and means of development in the near
future. Experts opine that Bangladesh can rise to a middle income country by using
this Blue Economy concept.
5. Digital Bangladesh:achievement and trends
DigitalBangladesh is one of the nation's dreams, and so special emphasis is given
on the application of digital technologies to realise Vision 2021, which we commonly
call Digital Bangladesh. By 2021, after 50 years of independence, our goal is to be a
middle-income country with peace, prosperity and dignity. The government of
Bangladesh implemented a large number of projects relating to digital technologies
and a number of these are already underway. National ICT Policy-2009 was
developed with a view to achieve middle-income status of the nation by 2021 and
developed status by 2041.

The World Bank classies economies as low-income, middle-income and

high-income groups. The Per Capita Gross National Income (GNI) is the basis of the
classication. Low-income and middle-income countries are referred to as
developing countries. Per Capita GNI is the dollar value of a country's income in a
year, divided by its population. As of July 1, 2014, low-income economies are
dened (in 2013) as those with GNI per capita of USD 1,045 or less (World Bank
Atlas Method) and middle-income economies with a GNI per capita above USD 1,045
(but less than USD 12,746). (According to this classication of the Word Bank,
Bangladesh should be very close to the middle-income group now and our target
should be the upper middle-income group by 2021.)

According to the National ICT Policy-2009, short-term, mid-term and long-term plans
consisting of 306 action plans have been identied for the realisation of Vision 2021.
Digital Bangladesh is an issue regarding which there is no conflict or difference of
opinion between the government and the people all are working hand-in-hand for
its realisation.

Achievements

The slogan of Digital Bangladesh of the Government of Bangladesh has special

signicance for national development. Digital Bangladesh with Vision 2021 is a big
impetus for the use of digital technology in the country. In spite of several
bottlenecks and limitations, works are in progress for the realisation of Digital
Bangladesh. Several projects for digitalisation have been completed and a big
number of projects are under progress. The nation now, with over 12 crore mobile
subscribers and 4.3 crore Internet subscribers, enjoys the fruits of digitisation in
numerous areas of activities. The ultimate objective is to make more and more
services available at the doorsteps of the people with increased digitalisation where

Habib Adnan
possible.

A few examples of available digital services are: registration for admission to

academic institutions, publication of results of examinations, registration for jobs
abroad, registration of pilgrimage, collection of ofcial forms, online submission of
tax returns, online tendering, etc. Online banking systems have sped up the nancial
activities of the country. SMS services for lodging complaints to police stations,
online bill payments for utility services, instant communication with persons working
abroad, and e-passports are some more examples.

Telemedicine services, videoconferencing for the treatment of diseases, and video

conferencing for administrative activities are examples of e-services available to
rural Bangladesh. Setting up of nearly ve thousand Union Information Service
Canters is a great boost for Digital Bangladesh, especially for rural areas. Turning
eight thousand village post ofces and approximately ve hundred upazila post
ofces into e-centers and the introduction of mobile money order and postal cash
cards are signicant achievements in the recent past. Union Information Centers,
District Information Cells, National Information Cell are also revolutionary additions.

There are many more developments in the line. Deputy Commissioner Ofces in
districts and UNO ofces in upazilas provide a large number of e-services to rural
clients. Direct digital services eliminate middlemen and save both time and money.
Without such online services, our cities and towns would have turned into difcult
places to live in.

ICT Trends

A noteworthy trend in ICT is that numerous devices with new and updated
technologies are rapidly replacing older devices. New technologies for the near
future include 3D printing, thumb printing, increased smartphone storage, expanded
use of IPv6, broadband services for consumers, cloud computing, quantum
computing, real-time speech transaction, nano-computers, wearable devices and
networks, cyber security, smart cities, Internet of Things (IoT), etc. New trends,
techniques and devices will massively involve online activities affecting our lifestyle.
IoT interconnects all sensors and smart objects to interconnect in such a way as to
make them intelligent, programmable and capable of interacting with humans.

More and more smart machines and processes will be required for decision-making
in business, administration and education, and they will impact our lifestyle and the
jobs of decision-makers signicantly. All types of jobs, including business and
administration, will be more and more digitised. We in Bangladesh will be forced to
use and adapt new technologies and will require expertise in new technologies like
cloud computing, 3D printing, Big Data, gaming, animation, outsourcing, etc.

Internet services require radical improvement in terms of speed. Starting from

e-commerce, the internet is used for numerous applications and a higher speed for
internet services is of great signicance for rapid economic growth. Most nations of
the world now give special emphasis on the improvement of Internet speeds.
Average internet speed of users is above 10 Mbps in many countries (South Korea:
25.3 Mbps, Hong Kong: 16.03 Mbps, Japan: 15 Mbps).

It is encouraging that the ICT Division of the Ministry of Posts, Telecommunications

and Information Technology has undertaken all-out efforts for the development of
ICT human resources through countrywide training. Some examples of these
trainings include Learning and Earning, Training for Mobile Apps, Leveraging ICT for
Growth, Employment and Governance Project, and ITES Foundation Skills Training.
Special emphasis is given to ICT education up to high school. Also, the ICT policy is
being updated to face new trends. Ambitious projects like development of the
National ICT Infrastructure for Bangladesh Government (Info Sarkar), National Data
Centre and IT Parks will bring about radical improvements in e-services,
e-governance and software development in the country.

Actions to be Taken

Bangladesh has an impressive track record of growth and development and aspires
to achieve middle-income status by its 50th birthday. The country needs faster
growth which depends on increased investments, development of human capital and
enhanced productivity.

We have mentionable progress in ICT considering our previous condition. But

keeping in mind our current rank and status in comparison with other nations and
the rapid development of ICT, the journey ahead for Digital Bangladesh will not be
smooth. Each new technology requires new skills and training. Human capital is a
key factor to develop and adapt innovative ideas and technologies. Quality ICT
education as well as ICT-based education from the primary to tertiary level, along
with the orientation of general mass in ICT should receive top priority.

Elimination of the digital divide between rural and urban areas and between
Bangladesh and other nations is essential in order to be at par with middle-income
nations. A peaceful political environment is essential for intellectual, social, cultural
and economic development. Time and time again, the nation's dream for Vision 2021
and Digital Bangladesh has been shattered by the turbulent political situation. The
country dearly needs a tranquil political environment for the development of all

Habib Adnan
sectors, including ICT, and for the realisation of Vision 2021 and Digital Bangladesh.

6. Banking Sector and Economic Growth

(Strength and weakness policy and recommendations)

Bangladesh's nancial sector is dominated by the banking sector. The dominance of

the banking sector makes the nancial sector vulnerable on the one hand, but
highlights the crucial importance of the sector in resource mobilisation and
economic growth, on the other. The role of the banking sector in accelerating growth
is contingent upon the soundness and depth of the sector. Banking sector growth
due to:

increasing the capital adequacy of banks,

streamlining guidelines for rescheduling of various types of loans,

tightening provisions for non-performing loans,

strengthening disclosure requirements and

improving accounting system.

These have undoubtedly improved the soundness of the sector over the years.
However, the performance of the banking sector in the recent past has not been
satisfactory. At present, key performance indicators of commercial banks in the
country reflect the poor health of banks. Most banks have not been able to show
signicant improvements on indictors such as

capital to risk weighted asset,

non-performing loans,

expenditure-income ratio,

return on asset,

return on equity,
 liquid asset and

excess liquidity despite several measures taken by the central bank.

Since large nancial irregularities in Sonali and BASIC banks, monitoring and
inspection of Bangladesh Bank have increased.

The central bank has also appointed observers in 14 banks and nancial
institutions, both state-owned and private to check further deterioration of these
banks and supervise closely to improve their governance.

Protability, measured by return on asset and return on equity, has been negative
for the state-owned banks (SCBs).

For private commercial banks, though these indicators are positive, but very low. In
case of non-performing loans (NPL) similar performance is observed.

Though the share of NPL to total loans in SCBs has slightly declined in September
2015 from June 2014, the rate is still as high as 21.82%. On the other hand, NPL in
private commercial banks (PCBs) and foreign commercial banks (FCBs) have
increased. Because of high NPL, state-owned banks have to make larger provisions.

The government has to inject capital into these banks to keep them going. Clearly,
implementation of BASEL III requirements that call for capital adequacy ratio to be
raised to 12.5% of their risk-weighted assets by 2019 will be challenging for the
SCBs. As of September 2015, capital adequacy ratio of SCBs was only 6.2%.

Lower prots in SCBs are mainly due to :

bad assets, inefciency and political interference.

In case of PCBs, stricter compliance requirements by the central bank and low
appetite for credit by the private sector due to sluggish business environment are the
major reasons for lower prots.

.The advance-deposit ratio has been little over 70% in November 2015 even though
banks are allowed to lend up to 80% of their total deposit.

Despite these Concerned authorities have been slow to take action against the
identied people for embezzlement of money from banks.

The Hallmark group has not returned any money to the bank till now.

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More frustrating is that bank authorities do not even expect to get back the
misappropriated money.

Flexible measures, including loan

rescheduling policy favouring powerful people and

lack of punishment for fraudulence in banks have worsened the situation.

In view of this there is a need for setting up a commission for the nancial sector.

The commission will scrutinise the overall performance of the sector,

assess the need of customers and the economy,

identify the current problems and emerging challenges and

suggest concrete recommendations for prudential banking to be implemented in

the short to medium terms.

Recently, there has been some discussion at the policy level as regards setting up a
'Financial Sector Commission' for the improvement of the sector. . The broad terms
of reference of the commission should be to critically assess the problems and
weaknesses of the banking industry in order to nd whether there is any disconnect
between demand of the growing economy and the realities of a back dated nancial
system that is failing to meet the emerging need. On the basis of a comprehensive
scrutiny, the commission will prepare guidelines and make recommendations as
regards automation, risk management, internal control, the role of various players in
banks and other nancial institutions. In 1998, a Commission on Banking and in
2002, a Banking Reform Committee were formed to make recommendations for the
improvement of the performance of banks.

The banking sector has achieved considerable success due to the reforms in the
1990s, 2000s and afterwards.

7.Financial Inclusion

BANGLADESH has made a broad social commitment for inclusive, equitable and
environmentally sustainable socioeconomic growth 'leaving no-one behind', as
espoused in the new sustainable development goals. The government has
accordingly led pro actively with the country's progress in sustainable development,
with policy thrusts on massive digitisation to support nancial inclusion and
inclusive growth, alongside mitigation and adaptation response to climate change
threats.

Despite having world economic shock in the recent past, Bangladesh has maintained
a stable performance on macroeconomic indicators by registering a growth rate of
more than 6 percent for the last few years. Bangladesh has targeted the new
trajectory of 7 percent plus growth from the current scal year. Major
macroeconomic indicators such as inflation, exports, remittances and scal
position remained benign over the last decade.

Along with sound macroeconomic fundamentals, performance on the social

indicators has been quite commendable, particularly in

* poverty alleviation,

* education,

*income and gender equality,

*adaptation to climate change,

*reduction of infant and maternal mortality

*and women's empowerment. With steady economic and social performance,

Bangladesh has proudly joined the (lower) middle income group. The country is
proceeding steadfastly to attain the upper-middle income status in the coming
decade or so.

With all these policies in mind, to reap the benet of a digitised economy,
Bangladesh has introduced:

*developed and implemented broad-based networking,

*Union Information

*and Service Centre, Enterprise Resource Planning,

*Open Data Initiatives,

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* Enterprise Data Warehouse,

*highly interactive website for government entities, e-tendering, e-education,

e-learning and various apps to provide optimum opportunities to citizens.

Bangladesh Bank, the country's central bank, is supporting the government's efforts
with its own initiatives by promoting nancial inclusion and environmentally
sustainable nancing. In recent years, the core banking solution for the central bank
and commercial banks, Credit Information Bureau's online services, electronic fund
transfer, cheque imaging and truncation based automated clearing, and national
payment switch for interoperability of all plastic card-based services have been set
up. Mobile nancial services have become the key tool of nancial inclusion
initiatives.

Moreover, in most cases, money is being channelled from urban to rural areas,
helping the rural economy. After shaping up all these retail channels, Bangladesh has
recently launched real-time gross settlement or RTGS for high value payment. Under
the present system, high-value interbank payments are done on the same day. But
under RTGS, interbank high-value claims and obligations will be settled instantly.

The cumulative outcome of these steps is quick service and skill development in the
nancial sector, which has now been into a single thread. Moreover, transparency in
the nancial transaction has also been increasing steadily. A new dimension has
also been added to the supervisory framework to combat corruption. All these
concerted efforts to digitise the country have ensured rapid, transparent,
decentralised and qualitative customer services.

For the last few years, Bangladesh has been trying to ensure sustainable growth
through alleviating poverty by reaching out to a large number of people at the bottom
of the pyramid using different development tools. In connection to these broad
objectives, Bangladesh Bank has adopted diverse initiatives to accelerate the pace
of nancial inclusion through formulating and implementing inclusive policy
measures. Bangladesh Bank has issued different circulars regarding the opening of
no-frills accounts for underserved segments such as farmers, freedom ghters,
government subsidy-holders, city corporation cleaners, garment workers, physically
challenged people, small life insurance holders, natural disaster affected people,
students and street children after completing simplied KYC formalities, agent
banking, and disbursement of loans under renance schemes.

To keep pace with those visions, need-based regulations have been formulated for
agriculture, SME, sustainable banking and other environment friendly and productive
sectors. The unique opportunity of opening no-frills bank accounts is actively serving
as a channel to disburse safety net programmes funds or other allowances from
government, collect utility bills, provide salaries, collect remittances, make payments
on behalf of customers, and disburse adequate credit including easy agricultural
loans from renancing schemes. These accounts also encourage the users to enter
the legal nancial system and develop a habit of saving.

In Bangladesh a great many of the "newly-banked" are women, low-income families,

rural people and members of marginalised groups such as religious and ethnic
minorities. Bangladesh, however, has become a role model for nancial inclusion,
thanks to the regulatory moves by its central bank for guiding the banks, both private
and public, in embracing nancial innovative inclusive products even during the
challenging time of global nancial crisis.

Ten-taka (12 cents) bank accounts for millions of farmers and social safety net
beneficiaries,

bank-led mobile banking, school banking, SME loans for women entrepreneurs and
green banking are some of the inclusive nancial products

8. Climate Change and Bangladesh

Climate change, already set in Bangladesh, is expected to wreak havoc on the

country in the not-too-distant future. Bangladesh is projected to be 0.5 to 0.20 C
warmer than today by the year 2030. The mean summer temperature then will be
27.50 C and it will be relatively higher during the monsoon than during summer,
experts say. Winter is the driest season. At the time the mean winter rainfall will
amount to about 64mm with a variability of around 53 per cent. By 2030, the best
estimate projection is for monsoon rainfall to increase by 10 to 15 per cent and
winter rainfall by 5 to 10 per cent.

Habib Adnan
Experts of the Met Ofce have already recorded a rise in average temperature in
Bangladesh in the September-October period. The average temperature this year has
been 1.0 to 2.0 degrees higher than the normal of 31.5 degrees Celsius during this
period. This coincides with the rise in global temperature by 2.0 degrees Celsius in
the last 136 years. More disturbing is the fact that an ample amount of rainfall,
recorded at 9,094 mm, throughout September was thought to have brought the
mercury down. On September 11, the highest maximum temperature of 35.3
degrees Celsius was recorded in Chuadanga district. The trend continued even in
early October, with the average temperature remaining higher than the normal
temperature.

At stake will be food security in Bangladesh if climate change strikes Bangladesh

with full ferocity due to changing temperatures, behaviour of rainfall and flow of
winds. The country is one of the most densely populated nations on earth. It has
more people to feed than geographically massive Russia. That is exactly why
environmentalists and experts have called for integrating natural resource
management, conservation, and climate change into national planning and
budgeting to ensure sustainable development in Bangladesh. They also underscored
the need for improving environmental governance alongside launching sensitisation
campaign among policymakers and mass people so that best practices and success
stories can be replicated and scaled up across the country.

But where is the nance required to face the climate change challenges? Will
Bangladesh seek loans from the global lenders like the World Bank or the Asian
Development Bank or other lenders? Or will Bangladesh use its already reputed
diplomatic clout to get generous grants to nance different projects to mitigate and
adapt to climate change? The government has reportedly invested more than $10
billion to make the country less vulnerable to natural disasters. It has started taking
measures to dredge major rivers, increase green belts in coastal areas and fortify
embankments to cope with the rising sea level, building emergency cyclone shelters,
and developing world class community-based early warning system which have
signicantly reduced loss of life and livelihoods and property damages caused by
extreme weather events.

To supplement its national programmes, Bangladesh has successfully aligned its

development partners to address the climate change challenge and established an
innovative nancing mechanism 'Bangladesh Climate Change Resilience Fund'
(BBCRF). But then Bangladesh needs to increase its transparency and proper use of
foreign grants. This was once highlighted by Saber Hossain Chowdhury, chairman of
all-party parliamentary group on climate change.

Transparency and accountability in spending climate funds would help the country
attract foreign funds in the future for combating the problem of climate change, said
Saber. An audit of the funds spent so far is also required to ascertain the value of
money and prevention of resource waste in various ways including corruption, he
said while speaking at a discussion. It is now time for Bangladesh to move forward
with suitable mechanisms to realise foreign climate fund as there has been no
progress in receiving grant from donors to address climate change impacts.

A study by the TIB has urged the government and the authorities concerned to
immediately address governance challenges in climate nance aimed at reducing
risks of corruption at different stages of project formulation, selection and
implementation and fund disbursement. The study was titled 'Climate Finance in
Bangladesh: Governance Challenges and Way Forward'. This report was prepared on
the basis of ndings generated through monitoring of fund flow, tracking of projects
one from Bangladesh Climate Change Trust Fund (BCCTF) and another BCCRF. It
also identied governance challenges in the approvals of projects submitted by
NGOs. The study revealed a number of irregularities, nepotism and incidents of
corruption at different stages of project formulation, NGO selection and
implementation.

In fact, Bangladesh has to put its house in order before approaching industrialised
countries for grants to nance projects to minimise fallout of climate change. These
are the following:

There must be the highest disclosure of projects related information,

Inclusion of affected people at every stage of project formulation and

implementation

Establishment of a complaint mechanism and quick disposal of such

complaints.

For NGO implemented projects, there should be a watchdog body like an

integrated national platform in addition to existing selection and approval
committee,

Full freedom to Palli Karma Shahayok Foundation (PKSF) in selecting NGOs, on

the basis of their competency, quick disposal of funds,

Habib Adnan
 Zero political pressure, and

Exemplary punishment in case of any corrupt practice.

9. Poverty

Bangladesh Bureau of Statistics (BBS) said, according to Household Income and

Expenditure Survey (HIES),rate of national poverty is 23.2% which was 31.5% in
2010.The rate of poverty reduced by 8.3 % over a period of last six years.

The HEIS also revealed that the country's extreme poverty is 12.9% in 2016 which
was 17.6 % in 2010.

The trend show that Bangladesh is apparently continuing its impressive progress in
poverty reduction.

The govt. said the country was very much on track to reduce the poverty into "zero
trajectory" by 2030 as targeted in the Sustainable Development Goal (SDG).

Cost of Basic Needs method is using by BBS for estimating the incidence of poverty.
In this method two poverty line are estimated.

1.Lower poverty line

2.Upper poverty line

Present nutritional requirement for per person per day is 2122 kilocalories.

Using the 2011 Purchasing Power Parity(PPP) the World Bank has set a standard of
calculating the poverty where it says if a person earns less than US$ 1.90 a day will
be treated a extreme poor. WB said Bangladesh's achievement in poverty elimination
as it was one of the fastest cut in the globe over the years. The reasons are:-

1.Increasing revenue earning and investment by the govt.

2.Spending more money on social protection and human resources development.

3.Impact of remittances

4.Infrastructure growth in rural areas.

5.Preparing National Social Security Strategy to protect the vulnerable group in the
country.
10. Building Dhaka a Smart City

Press a remote control button and get many emergency services in reasonably short
time - this is the quintessence of the smart city concept Dhaka South City
Corporation (DSCC) has now moved to apply.

The long lasting problems of Dhaka city are:

*Trafc jam

*Public safety

*Shortage of pure drinking water

*Poor waste management system etc.

DSCC announce that 2017 will be a year of digitisation.

**Smart city Dhaka would have smart surveillance lights - a sophisticated array of
LED xtures with built in sensor and cameras connected over a wireless network.
Through the cameras the flow of foot trafc and vehicles will be monitored.

**There will be an SOS(save our soul) button at each pole and the city - dwellers can
get emergency service by pressing the button.

**Some 37000 LED lights will be installed for the technology based monitoring
system.

**Waste management is a challenging task and it will be resolved with the help of
technology. When the bin will be lled with waste the waste inspector of the zone
concerned will get a notication from the bin having censor and the inspector will
instantly send instruction to the cleaner to remove the dust.

** The demand for pure drinkable water will also be met through developing IT -
based water tank at each community which will run automatically.

11.Advantage and Disadvantage of FDI

Bangladesh offers generous opportunities for private investment under its liberalised

Habib Adnan
Industrial Policy and export-oriented, private sector-led growth strategy. All but four
sectors, i.e. (i) arms and ammunition and other defense equipment and machinery,
(ii) forest plantation and mechanised extraction within the bounds of reserved
forests, (iii) production of nuclear energy, and (iv) security printing and mining, are
open for private investment in Bangladesh. The FDI strengthens ties with developed
countries that may yield cost advantages in the form of advanced technology
transfers and resulting positive externalities.

These reasons also increase the effort of Bangladesh in trying to make the country
an attractive destination for FDI which in itself has several advantages. The result
has validated a reinforced incentive to educate and train the population to make
Bangladeshs labour force more competitive through higher national education
expenditure.

As a result, potential investors from local and foreign countries have grown
substantially in sectors like manufacturing, telecommunication, energy and gas
sectors in addition to other sectors or sub-sectors being very promising for potential
private investment.

The FDI is capital provided by foreign investor, either directly or through other related
enterprises, where the foreign investor is directly involved in the management of the
enterprise. When a country has a situation of low cost of production and stable
political situation that country is generally the best choice for FDI. Until the 1980s,
most developing countries viewed FDI with great weariness as it has also some bad
sides because it exploits the cheap labour of our country. Popular belief was that we
have a huge amount of active and strong manpower. Thats why they come to our
country in the name of FDI but in return they actually exploit us. Besides, they use
our natural resources recklessly. So, our natural resources like gas and other things
are going to be exhausted. They earn a lot of prot every year and take away to their
country but they do not reinvest it in our country. Another most important thing is
influencing power in government decision. Since they are giant companies, they have
a powerful influential capacity in government decision. So there is a possibility of
losing the sovereignty of the country.

Actually, disadvantage is a matter of fact. If there is proper government control over

the company, it becomes advantages most of the times. In recent years, however
FDI restrictions have been signicantly reduced. Most countries offer incentives to
attract FDI, such as tax concessions, tax holidays, accelerated depreciation on
plants and machinery, export subsidies and import entitlements etc. As a developing
country, Bangladesh needs FDI for its ongoing development process. So, special
zones have been set up and lucrative incentive packages have been provided to
attract FDI. Export from any country give up a boost in any country for which it can
meet up its import expenses.
Moreover, there are a lot of advantages of FDI such as huge numbers of unemployed
people are employed and their standard of living is increased due to the increase of
income level of people. Their purchasing power is increased and the business cycle
moves at a good speed. Other sides like roads, communication system,
transportation facilities, and education are also improved at a greater speed.
Competition is increased in the local market with the local companies. Thats why
price of the product starts to fall. The GDP is increased due to increased production
in the economy as we can use our unutilized resources by FDI.

Bangladesh is not self-sufcient in energy sector. There is already growing interest

among international oil companies in contracts for exploration in this eld. The gas
sector has by now drawn large amounts of foreign investment. It has to be assumed
that FDI is increasingly becoming a signicant source for nancing domestic
investment in Bangladesh.

(i) Geographic location of the country is ideal for global trades with very convenient
access to international sea and air routes. (ii) Bangladesh is endowed with abundant
supply of natural gas, water and its soil is very fertile. (iii) Bangladesh has a hard
working and generally intelligent population of approximately 170 million. There is an
abundant supply of disciplined, easily trainable, and low-cost workforce suitable for
any labour-intensive industry. (iv) Bangladesh is a liberal democracy and mostly a
one race and one religion country. The population of this country irrespective of race
or religion have been living in total harmony and understanding for thousands of
years. (v) Although Bengali is the ofcial language, but English is generally used as
second language. Majority of even moderately educated population can read, write
and speak in English. (vi) Because of low per capita income of around US$1400,
present domestic consumption is not signicant. However, it should always be
considered that there exists a middle class with some purchasing power. As
economic growth picks up, the purchasing power will also grow substantially. And in
a country of 170 million people, even a small middle class may constitute a
signicant market. (vii) Most Bangladeshi products enjoy complete duty and quota
free access to EU, Japan, Australia and most of the developed countries.

Habib Adnan