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12 June, 2019 00:00 00 AM
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CPD for Tk 9,100cr allocation to farmers in budget

Staff Reporter, Dhaka

The Centre for Policy Dialogue (CPD) yesterday urged the government to make a budgetary allocation for giving Tk. 5,000 to each farmer in the country as compensation for losses during Boro harvest. The private think-tank made the recommendation while unveiling its report titled “State of Bangladesh Economy and the Budget Challenges” at the CIRDAP auditorium in the capital. CPD estimated that it will cost the government Tk. 9,100 core to implement the recommendation.

This year, Boro paddy is selling for about Tk. 500 per maund, which is less than last year. Farmers have to pay TK. 900–1,000 to hire a day labourer. So, they have to hire a day labourer with the cost of two maund paddy. “This year’s Boro harvest has not been a pleasant experience for the farmers due to unexpectedly low prices during the harvest season coupled with a high cost of production and lack of buyers in the market,” Toufiqul Islam Khan, a senior research fellow at CPD, said in his keynote presentation.

So, farmers are facing acute loss as the selling price of paddy is nearly half of the production cost. This has also inflamed protests across the country.

Given the situation, the government may consider providing a one-time cash incentive of Tk. 5,000 to each of the 18.2 million farmer—agricultural input assistance card holders—in the absence of crop insurance for revenue loss of the farmers during Boro rice cultivation, said Toufiqul.

“To provide cash incentives, a budgetary allocation of around

Tk. 9,100 crore may be required and it should be given to the farmers via their respective bank accounts,” he added.

CPD distinguished fellow Dr Debapriya Bhattacharya said: “I don’t see any trouble for the government to pay Tk. 9,100 crore to the farmers. If the government pays the compensation, it will be rational and just behaviour towards the farmers.”

CPD’s latest report explains how to accelerate revenue mobilisation in the 2019-20 fiscal year.

The independent think-tank also said the main challenge in the upcoming budget was to raise revenue collection to meet government spending. It also said a credible programme and all-out efforts will be required to accelerate revenue mobilisation in the 2019-20 fiscal year. This includes: implementing planned reforms, reaching out to expand the tax base, identifying new areas for revenue, enhancing administrative capacity, rationalizing fiscal incentives, and curbing tax evasion.

It also said an action plan to mobilise revenue in FY20 should be attached to the forthcoming budget.

Bhattacharya said: “A cleft in macroeconomic stability surfaced in the last fiscal year because of a revenue shortfall, problems in the banking sector, and pressure on the exchange rate of the Taka against the Dollar. The government’s steps—aimed at addressing the problems of the banking sector—are yet to produce a positive outcome.”

CPD further said an independent commission for the banking sector should be constituted without further delay, fiscal incentive-based measures will not work for capital markets. The commitment and competence of the Bangladesh Securities & Exchanges Commission was a prerequisite to strengthening the reform agenda, it added.

 

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Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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