IMF and World Bank assessment of “the absence of a crisis situation and major food shortage in Bangladesh”
By: Mehjabin Bhanu
According to the IMF, Bangladesh is not at risk of experiencing a crisis similar to that which occurred in Sri Lanka. An IMF official said Bangladesh was not facing a crisis and its external position was “very different from that of several countries in the region”.
When describing Bangladesh’s current economic situation to the media in an online conference on Tuesday, Rahul Anand, a division chief in the IMF’s Asia and Pacific Department, said that Bangladesh’s external position is “quite different from of several countries in the region.
According to him, Bangladesh’s external debt-to-GDP ratio, which is close to 14%, is moderately low, mostly concessional and poses minimal risk of a debt crisis.
Following his recently published interview in the London daily, Bangladeshi Finance Minister AHM Mustafa Kamal sent a response to the Financial Times. “Today, reserves stand at US$40 billion, enough for more than five months of import payments and beyond the risk threshold prescribed by the IMF.
After Sri Lanka’s economy collapsed, attention shifted to Bangladesh as the country sought to avert the financial crisis that erupted in the island nation. Concerns about the country’s economic health arose when Dhaka asked the IMF for a bailout and amid rising fuel costs. However, a senior executive at the Washington-based global lender denied the dire predictions.
The economist responded to claims that Bangladesh’s $40 billion reserve was a sign of “imminent disaster” by saying that “even though Bangladesh’s reserves have dwindled, stocks are still large enough to handle four five months of potential imports”.
There were rumors that the government’s most recent record fuel price increase was a requirement imposed by the IMF. The IMF official, however, refuted the accusations, saying there was no link between raising the price of fuel to bring it in line with market prices and the support package requested by the IMF (per Dhaka) . Bangladesh’s external debt is only about 14% of GDP, which is quite modest.
According to the media, Rahul Anand, division chief in the IMF’s Asia and Pacific Department, Bangladesh is not in crisis and its external position is “quite different from that of many countries in the region”.
While the Sheikh Hasina government has set a target of over $60 billion in export revenue for the next fiscal year, Bangladesh’s exports in the fiscal year 2021-2022 surpassed the $50 billion threshold. dollars (2022-23). The government was able to achieve a steady increase in remittances worth $813 million in the first ten days of August thanks to the further opening of the Malaysian labor market and a number of other government initiatives . The number of remittances received through the banking system in July was $2.09 billion, the highest in the previous 14 months.
Thanks to the wise leadership of Sheikh Hasina, the nation implemented a number of preventive measures in response to the spike in LNG prices in the spot market at the start of the ongoing conflict between Russia and Ukraine.
Among these measures were planned power cuts in various parts of the country, the suspension of some forward-looking development initiatives and restrictions on foreign travel by government leaders.
To compare RST money to an IMF bailout sought by Pakistan or Sri Lanka is obviously to ignore the forest in favor of the trees.
Nasrul Hamid, the deputy minister of electricity, minerals and energy resources, has already assured the people of his country that the current load shedding will end in September. He also made other allusions to the implementation of changes in oil prices according to international markets. Importantly, despite the price increase, Bangladesh continues to provide its citizens with the most affordable options, and the increase in oil prices was intended to reduce a staggering side payment of over BDT 8,000 crore made by the government. in the previous four months (February 2022—June 2022).
Bangladesh is considering importing crude oil from Russia as the price of gasoline in the country is rising dramatically. Masud Bin Momen, the Foreign Minister of Bangladesh, announced on Tuesday that a delegation of Russian experts would soon arrive in Dhaka to discuss the problem of importing crude oil from that country.
According to the World Bank’s report on food security in South Asia released on Thursday, there is no significant food shortage in Bangladesh. It is important to note that the government has implemented a number of initiatives to boost domestic production of food grains and vegetables. Bangladesh would not experience a food crisis even if it were impossible to buy food from other countries due to the volatility of world markets.
New rice varieties (BR-89) created by our experts will increase rice production by 50-60%. However, the reality is that due to the rising cost of diesel, seeds, fertilizers and other inputs, farmers in the country are now finding it difficult to continue growing grains and vegetables. Diesel, seeds, fertilizers and other inputs are extremely important for farmers to feed and grow their crops and vegetables. Their production costs will increase due to the increased cost of diesel, seeds, fertilizers and other inputs.
However, the country’s paddy aman production has already been severely hampered by drought conditions caused by lack of rain. Majority of the farmers in the country depend on rainwater for growing aman rice during the monsoon season. The goal of human agriculture in this season can potentially be hampered by the lack of rain.
The administration undertakes to guarantee access to food for all. Accordingly, it must come up with strategies to increase food production while providing unwavering support to farmers. Everyone should keep in mind that expanding the agricultural industry must continue to be a priority.
To meet its demand, the nation has an ample supply of all types of fertilizers. 6.45 lakh tons of urea fertilizer, 3.94 lakh tons of TSP, 7.36 lakh tons of DAP and 2.73 lakh tons of MOP are currently in stock. Fertilizer supply is currently higher than it was at the same time last year. The agricultural loan to farmers of Taka 2830.61 core was also distributed by public commercial banks.
To ensure that the citizens of the nation have access to adequate food, ministries of agriculture and food should make every effort to commercialize and profit from agricultural activity.
The government needs to focus more on our farmers so that the rising costs of diesel, seeds, fertilizers and other inputs do not deter them from growing food crops like grains and vegetables. Above all, the government should take the necessary measures to equip farmers with advanced equipment.
The writer is a teacher based in Bangladesh