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Interest waiver for defaulters objectionable move: Farashuddin

TBP Online
05 Jul 2024 17:35:27 | Update: 05 Jul 2024 17:40:39
Interest waiver for defaulters objectionable move: Farashuddin
— Courtesy Photo

The budget for FY25 – which is under the International Monetary Fund’s (IMF) influence – includes no firm direction on bringing back laundered money. This cycle of money laundering, corruption, and loan defaults must be checked, or it will pose a threat to the government.

Former governor of Bangladesh Bank Prof Dr Mohammed Farashuddin made the remarks as chief guest while addressing a Shadow Parliament debate competition on FY25 Budget, held at the city’s FDC on Friday, and organised by Debate for Democracy.

Farashuddin pointed out, “Loan interests on large loan defaulters are being waived, and this is a very objectionable move. The Tk 50,000 crore interest waived by the government banks should be considered as defaulted loans.

“Currently, inflation is said to be 9 per cent, but it is actually closer to 10 per cent. In the budget speech, it was mentioned that inflation will be brought down to 6.5 per cent, but it is not possible to achieve this goal.”

He continued, “Many people died of starvation in 1974 as middlemen created artificial shortages of stocks and supplies. So a balance must be maintained between stock and supply.

“The Tk 96,000 crore loan from abroad mentioned in the budget can become very harmful. The government should reduce dependency on loans from domestic and foreign sources, and focus on borrowing from savings certificates.”

Dr Farashuddin then added, “If more loans are taken from banks, investors will not get loans, and investment will stagnate. However, taking loans through savings certificates will reduce inflationary pressure and strengthen the social security sector.

Presiding over the event, Debate for Democracy Chairman Hasan Ahmed Chowdhury Kiran said, “Budget comes and the budget goes. After the budget, people are worried about whether the house rent, travel expenses, commodity prices, children's education expenses, medical expenses will increase or not.

“If the price of electricity, water, and gas increases, people with limited income will be in trouble. But it has become a trend to increase the price of everything every year after the budget. The people of the country are in trouble due to the increase in commodity prices.”

He added, “Income inequality is increasing day by day. Rising income inequality can lead to social discontent. A 15 per cent VAT on metro rail fare imposed on the public will be regrettable. No action has been seen in this budget to control commodity prices, chaos in the financial sector, money laundering, rampant corruption.

“There is no initiative in this budget to take action against loan defaulters and money launderers. Budget implementation will be difficult by maintaining weakness, discrimination and corruption in tax management. Tax collection targets will not be achieved unless good governance and efficiency in tax administration is improved.”

Budget implementation is not possible without good governance, accountability and political will, Kiran pointed out.

Jagannath University defeated Cumilla Victoria Government College in the shadow parliament debate titled, “This Year's Budget will help Sustainable Development.” Trophies, crests and certificates were awarded to the winning team at the end of the competition.