Abdur Rahman Harmachi, bdnews24.com
Published: 2019-01-01 16:06:40 BdST
But there has been no respite from the unrest in the banking sector; the amount of default loan has crossed billions. The amount, including waivers, is beyond Tk 1.3 trillion.
Businessmen and economists in Bangladesh suggest the government should focus on the banking sector from the very beginning.
The 2018 year was largely good for the economy with less trouble in the import-export sector. The key indicators were positive and the foreign reserve crisis has passed.
Sheikh Hasina will begin her third consecutive term as the prime minister of Bangladesh in a peaceful environment at the start of the new year.
According to Bangladesh Bank, imports increased 25.23 percent in the 2017-2018 fiscal year from the previous year. Imports rose 9.28 percent in the first half of fiscal 2018-19 (July to October).
The foreign reserves, which had dropped below $30 billion, have risen to nearly $32 billion.
Remittances sent in by migrant workers have increased in line with the last fiscal year. Remittances grew 17.32 percent in the last fiscal year. The remittance amount has increased about 10 percent in the first months of the current fiscal year.
The export income increased to 5.8 percent during the last fiscal year and rose 17.24 percent year-on-year during the period of July to November.
Another important index in the economy, inflation, remained satisfactory. The inflation rate in November was 5.37 percent.
Economic analyst Ahsan H Mansur and Nihad Kabir, president of the Metropolitan Chamber of Commerce and Industry, suggested Hasina should restore discipline to the banking sector to ensure a healthy economy when asked about their expectations from the new government at the beginning of the new year.
The total amount in defaulted loans was Tk 224.81 billion when the government led by Hasina took over power 10 years ago.
The amount increased to Tk 993.7 billion at the end of last September, a 4.5 times increase over the last 10 years.
Apart from that, the amount of loans written off by the banks and not recovered for a long period is Tk 350 billion.
The large amount of the defaults and other unrest in the banking sector has been a key topic of discussion over the past few years.
About Tk 225 billion has been embezzled in ten big incidents of over the past 10 years, especially at government owned banks, the Centre for Policy Development, a private research organisation.
It started with the Hall Mark scam in Sonali Bank but the largest incidents of embezzlement took place in Janata Bank.
The Basic Bank and the Farmers Bank also had some incidents of indiscipline and corruption.
CPD shared the information in a discussion on Nov 9, three weeks prior to the national election. It was then published and broadcast by newspapers, television channels and online media outlets.
Finance Minister Abul Maal Abdul Muhith dismissed the CPD’s claim as 'politically inspired'.
The economy in Bangladesh was good throughout the election year, said Ahsan H Mansur, executive director at the Policy Research Institute.
The main indicators were positive and exports and remittance were fine. The reduction in imports had also lifted the pressure off the foreign reserves, he said.
“There was tension in relation to the election year in case things turn violent. But 2018 ended peacefully,” he said.
"However the banking sector still has problems. The amount of loans has been increasing and there is no good governance. The government should focus on the sector in the new year.”
The new government should adopt a few strong measures to continue development, said MCCI President Nihad Kabir.
Bangladesh will develop more than it had over the last few years if the Awami League fulfils three of its promises prioritised in its election manifesto, she said.
"I believe the honourable prime minister will be able to do it as she has become the prime minister for a third term."
The Awami League mentioned a zero tolerance policy on corruption, a people-friendly administration and ensuring good governance in its election manifesto, she said.
“All these have to be implemented soon, with transparency.”
"There are many problems in the banking sector. People have lost their faith in banks. Even the government had to face severe criticism for it."
“I hope the government works to retrieve the goodwill in this sector from the start of the year.”
Finance Minister Muhith has also admitted the problems in the banking sector.
"I'll submit a report focusing on the overall situation of the banking sector, which will help the new government to resolve many issues if they implement it,” he told bdnews24.com in October during an annual conference of the World Bank and IMF in Indonesia.