Smart policy needed to build Smart Bangladesh by 2041

Policy inconsistency, discrimination, and a gap in implementation decelerate a country’s economic development as these escalate hassles while doing business, and intensify misdemeanors too. Besides, investment in the private sector from home and abroad mostly depends on the appropriate policy.

The smart policy will accelerate the ease of doing business climate in the country and would bring vibrant economic activities, and finally, it will help boost the export basket.

The necessity of making smart policy will help tackle the possible impact of least developed countries (LDCs) after 2026.

The motto of the Bangladesh government is to build a “Smart Bangladesh” by 2041 from Digital Bangladesh which is admirable.

Experts believe that there are serious obstacles about graduating to Smart Bangladesh from digital Bangladesh”. In 2008, Prime Minister Sheikh Hasina announced the vision of “Digital Bangladesh: Vision 2021” to make the country technologically advanced. But the country has not improved compared to its global counterparts. People are suffering greatly following slow internet services in the country.

Meanwhile, in 2022, Prime Minister Sheikh Hasina detailed a master plan termed “Smart Bangladesh”. It’ll stand on four key pillars Smart Citizen, Smart Government, Smart Society and Smart Economy.

As the government has set the vision to build a smart Bangladesh, so there is no alternative way to make smart policy without removing policy inconsistency of different sectors to bring more foreign direct investment (FDI) here.

But, sadly Bangladesh is following British Colonial rules till now in many cases despite the country marking its 50th year of independence. Archaic laws and rules delay judiciary activities and increase various crimes too. Even a lot of cases are in pending in different courts of the country not having updated policies of civil laws and others.

Currently, businesspersons claim that they have to spend a lot of money due to lack of time befitting policy, and they are also harassed vastly while doing business following policy inconsistency.

In a recent programme organised by Business Initiative Leading Development (BUILD) in collaboration with USAID’s Feed the Future Trade Activity, different experts and business leaders expressed worries about Bangladesh’s policy inconsistency. They said policy inconsistency makes ‘uncertainty’ in Bangladesh’s economic environment.

According to the Business Confidence Survey (BCS) 2022-23, some 88 per cent of businesses from the manufacturing sector and 43 per cent from the service sector have voiced concern over ‘uncertainty’ in Bangladesh’s economic environment due to policy inconsistencies.

At the event, the former President of the Dhaka Chamber of Commerce & Industry Abul Kasem Khan pointed out that policymakers should focus on a smart policy initiative to make Smart Bangladesh a policy that hinders business development in the country.

According to the chairman of Research and Policy Integration for Development (RPID) Dr Mohammad Abdur Razzaque, Bangladesh’s apparel exports to the UK would reach $11 billion from $4.5 billion in FY22 while Non-RMG product export would touch 1.3 billion from 0.7 billion by 2030. “To achieve it, Bangladesh has to revolve its policy discriminations,” the economist stated.

In this context, we think that Bangladesh needs policy reforms, and makes necessary policies to boost diversified industries.

Logistics is a very significant factor in terms of import and export processes, investment and overall flourishing economic activities but Bangladesh could not make a national policy on logistic service till now. If we look at Saudi Arabia, the country made a ministry on logistic services many years ago.

Bangladesh is on track to become a $500 billion economy but the country is now lagging behind in logistics performance compared to its global competitors. So, the business operation cost in the country is increasing day by day due to poor logistics infrastructure, creating a barrier to bringing more FDI here.

According to the Trade Freedom Index-2022, Bangladesh is ranked 125th while India is 90th, Vietnam 52nd, and China 80th. Business people have claimed that Bangladesh legs behind in performance as the country’s logistic services depend on 17 ministries and departments which made complexities for the sector. Though the Bangladesh government has recently formed a committee to frame the national logistics development policy, it did not finalize it yet.

In this perspective, Bangladesh needs a global standard logistics policy to reduce business costs to tackle the possible challenges after LDC graduation in 2026 and achieve developed country status. So, Bangladesh should invest around $320 billion by 2030 to attain Sustainable Development Goals (SDGs) as well as to reach its socioeconomic target of Vision 2041.

Despite being one of the oldest business sectors in Bangladesh, the jewellery sector has not yet developed like others due mainly to a lack of adequate policy support from the government.

As a result, the potential sector has to largely rely on illegal sources to meet the market demand. Some 90 per cent of the precious metal is now entering the country’s market illegally. According to sector insiders and researchers, policy complexity encourages traders to import gold illegally.

According to Bangladesh Jewellers Association (BAJUS), gold ornaments and bars worth over Tk73,000 crore enter the country illegally every year.

Bangladesh imported gold worth $397 million in 2020. Of them, gold worth $370 million was imported from United Arab Emirates (UAE) while $14.9 million from Singapore, $9.94 million from Malaysia and $2.26 million from Thailand, the association data showed.

Bangladesh is ahead of India in the garments industry globally. Bangladesh also can overtake India in the jewellery sector if the sector gets an ease and smart policy.

Bangladesh is called a tiger among Asian nations due to its economic growth but the country also has the lowest tax-GDP ratio in regions. The total population of Bangladesh is around 170 million but around 82 lakhs online tax identification number (e-TIN) holders are in the country. Around 26 lakh of them filed their tax returns in FY 22. According to National Board of Revenue (NBR) data, the authority collected over Tk 4,100 crore from 28.51 lakh return submissions in FY23. Hence, many blame the loopholes of laws, taxpayers and receivers due to the lowest ratio.

Tax collection has not improved in absence of dynamism in the tax law. To widen the tax net, Bangladesh must automate the tax collection process, and reform its policies. Besides, ensuring transparency, eliminating corruption, easing access to information, digital inclusion, quality education and quick connectivity are important for building a smart Bangladesh.

To build a smart government and smart economy by 2041, Bangladesh has to improve the ease of doing the business situation. Why the country has to depend on the laws which were made in 1800-1900? However, the country must modernise acts like the Companies Act, of 1994 and the Import and Exports Control Act, of 1950 immediately.

The writer is a journalist. He can be contacted with [email protected]