3

Bangladesh
Tapan Sarker

3.1 Introduction
The People's Republic of Bangladesh, republic of southern Asia, in the northeastern portion of
the Indian subcontinent, bordered on the west, north, and east by India, on the southeast by
Burma (Myanmar), and on the south by the Bay of Bengal. The area of the country is 147,570 sq
km with a population of 126 million. It lies roughly between 20°34′ and 26°36′ North latitude andbetween 88°01′ and 92°41′ east longitude (Appendix-A1). The capital and largest city of
Bangladesh is Dhaka.
Geographically, historically and culturally Bangladesh forms the larger and more populous partof the world. The plains of Bangladesh are watered by one of the most remarkable network ofrivers in the world, the important rivers being Padma, Meghna, Brahmaputra and Jamuna. With
thousand of years of history behind it, Bangladesh has a rich and varied existence. She made her
debut centuries ago as a Greenland of prosperity where the fine Muslin cloth was woven. Turks,
Mughals, Afghans, Armenians, Arabs, Portuguese had already visited Bengal, when the English
finally established their suzerainty over her in 1757. After partition of the Indian subcontinent in
1947, when the area that now forms Bangladesh became a part of Pakistan, the people of
Bangladesh were subjected to a system of economic exploitation, cultural and politicalsubjugation forcing Bangladeshis to rise in rebellion which resulted in the emergence of thePeople’s Republic of Bangladesh as a free and sovereign nation in 1971 after nine month-long
war of liberation.
Demographic Features
The country’s population is almost evenly distributed throughout its 64 districts except for thethree Hill Tracts districts which are rather sparsely inhabited. Regionally, the eastern districts
have a slightly higher density than the western ones. On average, a district has a population of
about 1.8 million, a thana 230,000, a union 25,000 and a village 2,000. There are 490 thanas,
4,451 unions and 59,990 villages. The number of households is about 20 million. On average, ahousehold consists of 5.6 persons. The tribal people, who lead a simple life, are generally selfreliant, producing their own food and drinks and weaving their own clothes. There are 4
metropolitan cities and 119 municipalities in the country. The level of urbanization is low at 20%.
This leaves 80% of the country’s total population of about 126 million to live in the rural areas
which primarily depend on a poorly developed agriculture for livelihood. The capital city of
Dhaka has an estimated population of 8.58 million. The annual growth rate of the population has
come down to 1.75% with the acceptance of family planning practices rising to 48.7%. The crude
birth rate per 1000 is 25.6 and the death rate is 8.1. Life expectancy at birth is 59.5 years. The rateof child mortality per 1000 has come down to 76.8 and that of maternal mortality to 4.5. About
96.3% families in the country have now access to safe drinking water. The sex ratio is 106 males
for every 100 females. The density of population per square kilometer is 800. Some 44.3% of thepeople are literate with about 5 million having passed secondary school level and another 1.27
million being graduates.
The primary school enrollment rate has risen to 86% and the rate for secondary school
enrollment to 33%. To intensify promotion of compulsory primary education, the food-for
education programme has been extended to over 16,000 schools.

Table 3.1 Demographic Indicators of Bangladesh
Total Population
Total Populations (millions)
Annual population Growth Rate % (Change)
Life Expectancy at Birth (years)
FemaleMale
Population Below Poverty Line
Source: ADB Report, Dec 1999

1995
97.5
2.1

1990
109.6
2.0

1998
126.0
1.67

56.0
55.0
49.0

55.7
56.5
47.5

58.1
57.6
47.5

Labor ForceOccupationally, 75 percent of the civilian labor force, which is currently estimated at 56
million, is directly or indirectly engaged in agriculture. Only 12 percent is engaged in industry.
Unemployment is estimated at around 18.5 percent. In terms of age structure, it is more youthful
than in the western countries. Heavy pressure of population on scarce land has no doubt createdan extremely unfavorable land-man ratio. Coupled with this is the problem of unequal distribution
and heavy fragmentation of land in the rural areas. This is expected to improve with morevigorous efforts at poverty alleviation and raising of educational and social consciousness.
Sluggishness of the agricultural sector has resulted in its increasing dependence on the whims ofnature and the per capita daily availability of food grains coming down to low level of 432 gram.
Nearly 45% of the people live below the poverty line.
Financial Affairs
The financial affairs of the state are primarily regulated by the annual budget presented to theparliament, usually in June, for discussion and voting before the next financial year begins in July.
A budget session is the occasion when the legislators get the best opportunity to scrutinize theactivities of the government, especially in relation to development programs for theirconstituencies. The public accounts committee of the parliament and the independent Comptroller
and Auditor General are charged with the responsibility of scrutinizing all state expenditures.
Bangladesh Bank is the central Bank. It regulates currency, banking and foreign exchange.
Some of the leading banks and insurance companies operate in the public sector. A sizable
number of banks and insurance companies including foreign companies operate in the private
sector. The stock markets in Dhaka and Chittagong operate independently under the regulatory
supervision of the Securities and Exchange Commission. The recent trend is to privatize as many
government-owned industries and companies as possible as part of its policy to encourage theprivate sector and make the economy market-oriented and competitive.
The greatest challenge for the present government has been to accelerate growth in theeconomy by freeing it from the vicious circle of sluggishness and low growth and infusing newlife into it. GDP grew only at 4.2 percent in 1993-94, at 4.4 percent in 1994-95 and at 4.7 percent
in 1995-96. Poverty alleviation in the country is possible only along the accelerated growth path.
The government’s efforts succeeded in raising GDP growth to 5.7 percent in 1996-97 and it ishoped the rate will go up to 7 percent in the coming years. Agriculture sector registering a growthrate of 6 percent has been the main engine of the national growth. The rate of inflation has
dropped to 3.34 percent compared to 4.07 percent a year ago. For higher GDP growth,
investments in both public and private sectors will need to be accelerated. The prevailing politicaland economic stability has greatly encouraged investment in the private sector. The trend of
foreign direct investment is very encouraging.
The government is committed to market economy and has been pursuing policies forsupporting and encouraging private investment and eliminating unproductive expenditures in the
public sector. A number of measures have been taken to strengthen the planning system andintensify reforms in the financial sector. The present government believe that wastage ofresources is a far greater obstacle to development than inadequacy of resources. It is common
knowledge that many development efforts in the past years turned into exercises in futility
because of inefficiency and corruption in high places. Terrorism was allowed to paralyze law andorder. Administration was over centralized at the cost of local government institutions. The
government has, therefore, decided to decentralize administration in the quickest possible time.
Foreign Aid
The government is aware of the fact that because of the existing international economic
environment the amount of foreign aid so essential for developing countries like Bangladesh is
fast dwindling. The conditions of aid are also becoming stringent. The government has, therefore,taken appropriate initiatives for proper utilization of foreign aid. The country’s development
partners at the same time, ought to acknowledge that Bangladesh not only needs more aid but also
better aid. The government has given the highest priority to implementing with utmost efficiency
the annual development programme (ADP) which allocates domestic and foreign resources todifferent sectors of the economy. The size of ADP for 1997-98 has been estimated at Tk 128
billion with the share of domestic resources rising to 47 percent. From the economic and social
points of view, agriculture is the country’s most important sector as it contributes 32.4 percent of
GDP and about 75 percent of its 120 million people are directly or indirectly dependent on it for
their livelihood. But because of declining growth in agriculture in the past the standard of life of
the small and marginal farmers had been going down forcing the nation to become increasingly
dependent on food imports. The government has, therefore, decided to increase allocation for
agriculture substantially and offer a wide range of incentives to the farmers including liberal
credit to raise production and generate on-farm and off-farm employment for the rural poor. An
Agriculture Commission has also been set up to recommend long-term policy reforms to boost
the sector.
A New Horizon for Investment
Bangladesh is now trying to establish itself as the next rising star in South Asia for foreign
investment. The government has implemented a number of policy reforms designed to create amore open and competitive climate for private investment, both foreign and local. The country
has a genuinely democratic system of government and enjoys political stability seen as a sine qua
non for ensuring a favorable climate for investment and sustained development.
Bangladesh has been quick to undertake major restructuring for establishing a market economy,
with the major thrust coming from the private sector. The country enjoys modest but steadyeconomic growth. Its current development strategy is based on the premise that the creation anddistribution of wealth occurs through the acceleration of growth driven by competitive market
forces, with the government facilitating growth and making a clean break from the practices of acontrolled economy where private investment is constrained. With this end in view, thegovernment has been gradually withdrawing its involvement in this industrial and infrastructure
sectors and promoting private sector participation. The government has moved speedily totranslate its policy pronouncements into specific reforms. It has been consistently pursuing an
open-door investment policy and playing a catalytic rather than a regulatory role.
Regulatory controls and constrains have been reduced to a minimum. The government has
steadily liberalized its trade regime. Significant progress has been achieved in reducing non-tariff
restrictions on trade, rationalizing tariff rates and improving export incentives. The introductionof VAT has helped rationalization of the import tariff and domestic tax structures. The tariffstructure and the import policy are kept under constant review to identify areas where further
improvements are called for. On the legal and administrative front, the government has initiatedmeasures to give greater autonomy and independence to the judiciary - a pre-requisite as viewed
by investors, for the restoration of confidence in the judicial system.
A permanent Law Reform Commission has already been set up to ensure greater transparency
and predictability in the way rules and regulations are made and implemented. An AdministrativeReform Commission to rationalize existing rules, regulations and procedures has also been set up.
The Company Law has been updated and modernized. The Securities and Exchange Commission
has been established to oversee and regulate the operations of the stock market.
The financial services have been strengthened through enactment of the Banking Companies
Act, 1991 and the Financial Institution Act, 1993. The Industrial Relations Act has been amended
to enhance labor market efficiency. Motivated by the simple realization that state-owned
enterprises are a drain on its scarce resources and that these are generally inefficient, very costly
and slow in responding to changing markets and consumer desires, the country has embarked on a
privatization programme, offering substantial opportunities for international investors.
In order to entice investors, the government has put in place an extensive programme ofincentives, which include : no ceiling on investment; tax-exemption and duty-free importation ofcapital machinery and spare parts for 100% export-oriented industries; residency permits forforeign nationals; capital, profit and dividend repatriation facilities; hundred percent foreign
equity allowed; exemption of income tax up to three years for expatriate employees; term loans
and working capital loans from local banks allowed; reinvestment of repatriable dividends
treated as new investment; double-taxation avoidance, as per bilateral agreements alreadyconcluded; tax exemption on the interest payable on foreign loans and on royalties and technicalknow-how fees; open exchange controls; multiple-entry visas for foreign investors; investors
can take advantage of the generalized system of preference, which allows duty-free access toAmerican, European and Japanese markets; Taka is convertible for current account transactions.
The Country also offers : extremely competitive labor costs, perhaps the lowest in Asia, easily
trainable workforce of 56 million; a large domestic market, with disposable income growing
especially among the middle class; strategic location as the bridge between South and East Asian
high-growth regions as well as links with other markets e.g. India, Pakistan, Malaysia, Singapore
etc; low land and energy costs; good road/bridge/rail infrastructure, which are being improved;
two sea-ports being further developed; enjoys Most Favored Nations status; legal protection toforeign investment against nationalization and expropriation; equitable treatment with local
investors regarding indemnification, compensation etc.
All sectors of industry (except five) are open for private investment. The five sectors reservedfor public investment only are defense and defense production, nuclear energy, extraction fromreserved forests, security printing and mint and air transportation (some domestic routes andinternational air cargo already opened for private investment.) and railways. Some of the foreign
private investment opportunities are: direct (100%) foreign investment or joint venture
investment in the Export Processing Zones (EPZs) or outside EPZs (with the exception of the fiveindustries mentioned earlier); portfolio investment by purchasing shares in publicly listedcompanies through the stock exchange; investment in infrastructure projects such as power
generation (private power generation policy announced); oil, gas and mineral exploration,
telecommunication, ports, roads and highways; outright purchase or purchase of shares of stateowned enterprises, which are under process of privatization; investment in private EPZ (Private
EPZ Act recently passed).Foreign investment is particularly welcome in the export-oriented
industries such as textiles, leather goods, electronic products and components, chemicals andpetrochemicals, agro-based industries, green jute pulp, paper, rayon products, frozen foods(dominated by shrimp farming), tourism, agriculture, light industries, software and dataprocessing. Foreign investment is also desired in high technology products that will help importsubstitution or industries that will be labor as well as technology intensive.
The country’s drive for foreign investment is being spearheaded by the Board of Investment,
which was created to facilitate the setting up of manufacturing and other industries in the private
sector, both local and foreign. It is a promotional organization dedicated towards providing
investment assistance to all investors. The country’s Prime Minister heads the Board and it
includes Ministers and Secretaries from the concerned ministries as well as representatives fromthe private sector. The Board has launched an investment promotion drive at home and abroad toattract investors. The BOI has been assisting in the implementation of new projects as well as
providing services. Bangladesh is on the verge of a significant breakthrough in terms both ofinternational investor confidence and significant inflow of new investment funds.

3.2 Overview of Fiscal Position
3.2.1 A Brief review of Economic Activity
Fiscal Policy and Fiscal Management
The goal of country’s fiscal management is to strike a balance between government revenue
and expenditure. Another major goal is to keep down deficit in the current budget as far aspracticable for higher investment in the public sector. As a result of prudent fiscal policy andstrengthening of fiscal management, overall fiscal deficit during the current decade remained
restrained. The budget estimate for 1998/99 fiscal year envisaged revenue receipts at Tk.20,776
crore of which Tk. 16,617 crore was estimated from tax and Tk.4,159 crore from non-tax sources.
Compared to the revised budget of the previous year , this target was 10.64% higher for total
revenue- 10.77% for tax revenue and 10.14% for non-tax receipts.
Following the tax reforms including strengthening of tax administration, tax-GDP ratio is
estimated to move up to 11.9% in from 9.4% in 1990/91. Legal, procedural and administrativereform measures for both direct and indirect taxes continue in 1998/99. In the case of income tax,
five-tier tax rates have been reduced to 4. Tax rates for banks, insurance companies, and financial
institutions are to be 35% instead of 40% if they are publicly traded companies. The system ofallowing depreciation for capital assets has been simplified. Maximum rate of import duty has
been scaled down to 40% from 42.5%. The number of import duty rates has also been reduced to
5 from 6. On the other hand, 9 commodities have been brought under VAT at retail stage while
for a few commodities, VAT has been imposed at production stage on the basis of retail price.
Supplementary duty rates applicable to cars and jeeps and that on domestically produced
cigarettes have been rationalized.
Foreign Trade
Bangladesh has been pursuing a liberal trade policy in keeping with global market economy.
To this end, Government in the light of limited productive policy to the extent possible for thesake of health, security and religious considerations adopted the policy for the further liberalizing
the export and import regimes including reduction of tariff rates. A five-year (1997 through 2002)
import policy became effective from June 14, 1998. In the new Import policy, BEPZA, BSCIC
and Board of Investment have been treated as sponsors of the concerned industry. It will ensuresmooth coordination between industrial and import policies and reduce administrativecomplexities relating to prior approval from different Ministries dealing with industry andcommerce. In the new import policy, the system of quality control has been strengthened. In theof report-oriented industries enjoying bonded warehouse facilities, country of origin restriction
has been withdrawn in the new policy for import of raw materials. As a result, import of raw
materials for 100 percent export industries has been made easier which will help expansion ofexport industries. The maximum rate of import duty of 42.5% in 1997/98 has been reduced to
40% in 1998/99. Tariff slabs have also been reduced to 6 from 7 and integrated. In order tonormalize and stabilize prices of essential commodities, steps have also been taken towithdraw/reduce duty on soybean oil, dry chilies and onion and rationalized tariff on different
commodities and materials. In the perspective of this measures, average nominal rate ofprotection fell to 20.3% during the current year from 20.7% in the preceding year and thecorresponding import weighted average nominal protection rate declined to 14.1% from 16.0%.

GDP: growth and composition
According to provisional estimate, GDP at current prices increased by 13% to Tk 174,926
crore in 1998/99 (approximately US $ 36.06 billion) compared to increase of 10.4% to Tk.
154,833 crore in 1997/98. Per capita GDP in 1997/98 increased by 11.6% to Tk 13,655 comparedto growth of 8.4% to Tk 12,240 in the preceding year. At constant prices (1984/85), GDP growthrate is estimated at 5.2% during the current year compared to 5.7% in 1997/98 and 5.9% in
1996/97.A look at the sectoral growth rate of GDP shows that during 1998/99, growth inagriculture sector was 5.0% compared to 2.9% and 6.4% in 1997/98 and 1996/97 respectively.
Table 3.2 Sectoral Share and Growth Rates of GDP FY 99-FY 2000(%)
Industrial Original Sector
1

2
3
4

5.
6
7
8.
9
10
11
12
13
14
15

Agriculture Sector
Agriculture and ForestryA) Crops & horticultureB)Animal farming’sC)Forest and Related Service
FishingIndustry Sector
MiningManufacturingA)Large and Medium scaleB)Small Scale
Electricity, gas and watersupplyConstruction
Service Sector
Wholesale and retail trade
Hotel and restaurants
Transport
Financial intermediations
Real estate, renting
Publicadministration
anddefense
Education
Health and social work
Community,socialandpersonal service
GDP at Constant prices

FY 98
25.34
19.67
14.59
3.19
1.89
5.67
25.71
1.03
15.88
11.29
4.59

Sectoral Share(%)
FY99
FY 2000
25.28
25.47
19.35
19.32
14.33
14.40
3.12
3.04
1.90
1.89
5.93
6.15
25.69
25.67
1.00
1.00
15.60
15.40
11.20
11.06
4.41
4.34

FY98
3.19
1.63
1.05
2.64
4.51
8.98
8.32
5.76
8.54
9.28
6.77

Growth Rate(%)
FY99
FY2000(p)
4.77
6.43
3.28
5.49
3.16
6.13
2.69
2.74
5.16
5.16
9.96
9.50
4.92
5.55
1.32
6.46
3.19
4.25
4.19
4.35
0.75
4.00

1.41

1.42

1.43

2.01

6.00

6.03

7.39
48.95
13.02
0.62
9.13
1.57
9.18

7.67
49.03
13.21
0.63
9.21
1.58
9.07

7.84
48.86
13.38
0.63
9.24
1.58
8.91

9.48
4.77
5.98
6.50
5.69
5.27
3.80

8.92
4.91
6.51
6.65
5.90
5.40
3.82

8.00
4.98
7.00
6.75
6.06
5.41
3.71

2.54

2.55

2.56

5.90

5.70

5.97

2.12
2.23

2.17
2.23

2.17
2.21

8.10
4.59

7.70
4.60

5.70
4.73

8.54

8.37

8.17

2.85

2.95

3.00

100

100

100

5.23

4.88

5.47

Source: Bangladesh Bureau of Statistics, 2000 Note: P= Projections; 1995-96 Constant price
Savings
In 1990/91, domestic and national savings as percentage of GDP were 4.13% and 10.86%,
which increased gradually to 8.6% and 14.83% respectively in1997/98. Bangladesh’s domestic
and national savings rates are still much lower than many low income countries of the world. Inorder to attain the targets of domestic and national savings in line with the targets for remaining
period of the fifth five year plan, and higher GDP growth rate at existing resources, pragmatic
fiscal and monetary policies have to be pursued.
Investment
Investment/GDP ratio, which was 11.50% in 1990/91(5.68% public and 5.82% private), increased
gradually to reach 17.81% in 1997/98 (public 6.64% and private11.17%). As emphasis is being
given on privatization and local financing including direct foreign private investment have been
increasing, investment in the private sector is gradually picking up. Because of massive losses byflood and lower GDP growth rate, investment in public and private sectors would not attained theplanned target. For attainment of higher growth rate in GDP and investment more effective
policies are indispensable. The following Table shows public, private and total investment ratesince 1990/91 through 1998/99.
Figure 3.1 Investment-GDP Ratio
25

Investment

as % of GDP

20
15

Private10

Public

5
0
FY97

FY98

Year

FY99

FY2000Source: Ministry of Planning, 2001
Inflation
The rate of inflation in FY 99 stood at 8.91 percent, up from 6.99 percent in FY98. Inflation
rate measured by the all urban CPI and all rural CPI stood at 8.89 and 8.91 percent, respectively
during FY99-an insignificant difference. Inflation though the first half of FY2000 has remained
low at 3.8 percent, helped by still declining food inflation(3.9%) and non food inflation by 3.6%.
The government has been partially accommodating the increasing fiscal deficit through monetary
expansion. The international price increases combined with the lagged effects of monetary
expansion imply that there is a need for greater prudence in monetary policy to avoid aresurgence of inflation in the near future.

National

Source: Ministry of Finance,2000

All Urban

N

ov

'9

9
D
ec
'9
9

9
'9
ct
O

Se
p'
99

Au
g'
99

9
Ju
ly
'9
9

19

98

-9

8
-9

19

97

-9
96
19

19

95

-9

7

10
9
8
7
6
5
4
3
2
1
0
6

% Change

Figure 3.2 Inflation Rate

All RuralOfficial Exchange rates of selected currencies
Frequent devaluations of local currency is a regular phenomena by for a long time and mainly
done to facilitate manufacturing and agricultural sectors 1 and enhance export earnings.
Government also keen to enhance inflow of money to be remitted by millions of Bangladeshi
expatriates throughout the world.
Table 3.3 Official Exchange rates of Selected countries
Period1994-95
1995-96
1996-97
1997-98
1998-99
1999-2k
2000-01

Taka per Poundstarling
63.47
62.96
68.97
74.66
78.94
76.98
77.45

Taka per US
Dollar
40.20
40.72
42.64
45.32
48.07
51.00
54.00

Taka Per Deutsche
Mark
27.05
27.93
26.79
25.24
27.45
26.37
24.51

Taka per yen
0.42
0.40
0.34
0.33
0.38
0.47
0.48

Source: Bangladesh Bank, 2001
3.2.2 Fiscal Position
In recent years Bangladesh following a prudent monetary and credit policy whileaccommodating the need for a large flood rehabilitation program. The following Table shows thegovernment budget indicators for the recent past financial years at a glance.
Table 3.4 Government Budget Indicators
Items
In Billion Taka
Revenue Receipta)Taxb)Non-Tax
Total Expenditurea)Revenue Expenditureb)Development Expenditure
1)ADP
2)Non-ADP
Over all deficita) Net Foreign Financingb)Net Domestic Financing
GDP at market Price
As % of GDP
Revenue Receipta)Taxb)Non-Tax
Total Expenditurea)Revenue Expenditureb)Development Expenditure
1)ADP
2)Non-ADP
Over all deficita) Net Foreign Financingb)Net Domestic Financing

FY97

FY98

FY99

FY2000171.45140.7430.71
250.11125.35124.76
117
7.76
78.66
49.70
28.96
1807.01

187.77150.01
37.76
270.7
145
125.7
122
3.7
82.93
52.29
30.64
2001.77197
158.5538.45
332.06167.65164.41140.0024.41
135.0688.84
31.57
2196.95241.51
186.3555.16
361.78178
183.78155
28.78
120.2783.6
36.67
2412.74

9.49
7.79
1.70
13.84
6.94
6.90
6.47
0.43
4.35
2.75
1.60

9.38
7.49
1.89
13.52
7.24
6.28
6.09
0.18
4.14
2.61
1.53

8.97
7.22
1.75
15.11
7.63
7.48
6.37
1.11
6.15
4.04
1.44

10.01
7.72
2.29
14.99
7.38
7.62
6.42
1.19
4.98
3.46
1.52

Source: Bangladesh Bureau of Statistics, 2000
The monetary policy of FY2000 was prepared with a view to ensuring rapid growth of theeconomy as well as channeling sufficient fund to the private sector for investment. Government
1

Garments sector is the single largest source of export earning followed by Shrimps and frozen foods in Bangladeshhas been pursuing liberalization of the financial market. Interest rate band was withdrawn fromsmall and cottage industry and agricultural sector in July 1999. The following chart shows thevarious ratios which says government earning is far away from its actual expenditure. Also
domestic investment is not at per with Net Foreign Financing.
Figure 3.3 Government Expenditure-GDP and Revenue-GDP Ratio
16
14% of GDP

12
10
8
6
4
2
0
FY97

FY98

FY99

Revenue Receipt

FY2000Total Expenditure

Figure 3.4 Net-Foreign Financing and Net-Domestic Financing
6
5
4
3
2
1
0
FY97

FY98

Net Foreign Financing

FY99

FY2000Net Domestic Financing

Source: Ministry of Finance, 1999
To induce internal investment several attempts have been taken so far on behalf of thegovernment. Bank rate has been reduced to 7 percent from 8 percent in August 1999 and theminimum cash reserve ratio on demand and time deposits of the scheduled banks was reduced
from 5 percent to 4 percent in October 1999. These are steps in the direction of liberalization offinancial market. Very recently in October 2001 the bank rate has been reduced to 6 percent. It
depicts that the government encouraging internal investment to manifold industrial production
and growth.
The National Board of Revenue (NBR)

The National Board of Revenue (NBR) is the central authority for tax administration in
Bangladesh. It was established by President's Order No. 76 of 1972. Administratively, it is underthe Internal Resources Division (IRD) of the Ministry of Finance (MoF). MoF has 3 Divisions,headed by 3 permanent Secretaries to the Government, namely, the Finance Division the Internal
Resources Division (IRD) and the Economic Relations Division (ERD). The Secretary, IRD is theex-officio Chairman of NBR. NBR is responsible for formulation and continuous re-appraisal of
tax-policies and tax-laws, negotiating tax treaties with foreign governments and participating ininter-ministerial deliberations on economic issues having a bearing on fiscal policies and tax
administration.
The main responsibility of NBR is to collect domestic revenue (primarily, Import Duties andTaxes , VAT and Income Tax ) for the government. Other responsibilities include administrationof all matters related to taxes, duties and other tax producing fees. Under the overall control of
IRD, NBR administers the Excise, VAT, Customs and Income-Tax services consisting of 3434
officers of various grades and 10195 supporting staff positions (Approved set up as on 09 Feb.,
2000 AD).
Figure 3.5 NBR and non NBR Revenue Receipts
Revenue receipts by NBR
Revenue receipts by non NBR Sources
25%

75%

Source: National Board of Revenue, 1999
Tax Share
The following Table and Chart shows the tax structure and contribution of different sectors of
the total revenue.
Table 3.5 Revenue Collection Position upto Dec.1997, Dec.1998 and Dec. 1999
(Fig: Taka in Crore)
Heads
Customs Duty
VAT(Import)
SD (Import)
Excise Duty
VAT(Domestic)
SD (Domestic)
Income Tax
Other Tax
Total

1997-97 (Upto Dec'97)
2164.34
1374.98254.2474.11
756.98790.19740.9797.44
6253.25

1998-99 (Upto Dec'98)
2219.721404.31348.4574.03
756.10790.82866.3695.42
6555.21

Source: National Board of Revenue, 1999
Figure 3.6 Government Revenue Collection Scenario

1999-2000 (Upto Dec'99)
2026.23
1433.65354.0291.26
861.04779.581013.65
110.006669.43

Source: National Board of Revenue, 2000
Annual Development Program(ADP)The original allocation of ADP 1998/99 was Tk 136.00 billion(Tk 73.82 billion externalfinance and Tk 62.18 billion local finance). Revised ADP 1998/99, was 140.00 billion of which
Tk 81.88 billion was from foreign sources and Tk 58.12 was from domestic sources. The size of
ADP of FY2000 is Tk 155.00 billion. Out of the total, Tk 76.67 billion(49.46%) and Tk
78.33(50.54%) are projected to come from foreign and domestic sources respectively.
The social sectors got the highest allocation (40 percent of total sectoral outlay). Among thedifferent sub-sectors included in the social sector, the education sector received the highest
allocation (14 % of the total allocation). Poverty alleviation is the priority of ADP FY2000.
Sectors and sub-sectors directly related with poverty alleviation (agriculture, rural development,
primary and mass communication, health and family welfare, social welfare, women and youth
development, labor and manpower) were allocated Tk. 53 billion in the current ADP(34% of thetotal).
Figure 3.7 Foreign and Domestic Financing in the ADP

in billion taka

200

ADP Financing

150
100
50
0
1998/99

1999/2000

Domestic FinanceSource: Ministry of Planning,2001

Private Sector Development
The government has been pursuing a private sector-led growth strategy through continuing
reform and liberalization program coupled with limiting its primary role as a facilitator. Public
sector undertaking is now mainly focused on necessity infrastructure development and humanresource development.
The New Industrial Policy 1999 (NIP 1999) opened up all sectors for private and foreign
investment except four2. Foreign investors can own upto 100 percent equity share without priorapproval of the government and there is no discrimination between foreign and local investors inregard to fiscal incentives and duty exemptions. Protection against nationalization andexpropriation to foreign investors are guaranteed. The Board of Investment (BOI) is meant
primarily to facilitate foreign investors in matters relating to legal and regulatory compliancewhich, however, is rather simple.
The incentive package includes tax holiday up to a maximum of seven years (10 years for units
located inside the EPZs), borrowing from foreign sources by foreign enterprises in the Export
Processing Zones(EPZs) without prior prior permission and free remittances towards repaymentof principal and interest on foreign borrowing.
Private Investment Trend during FY97 to FY99, 4669 projects, with an estimated investment
of US$ 9.8 billion were registered with the Board of Investment, including 439 foreign projects
with investment of US$ 6.4 billion. Bulk of the investment proposed is in gas sector. There arealso interests in manufacturing, infrastructure and utility e.g. cement, ports, telecommunications.
Domestic private investment increased from US$ 2.65 billion during the five years of FY92 toFY96 to US$ 3.43 billion during the three years of FY97 to FY99. Foreign Investment rose from
US$ 3.13 billion to US$ 6.42 billion over the corresponding period.
Foreign Direct Investment
There has been a significant spurt in foreign direct investment (FDI) in the last few years.
Between FY97 and FY99, FDI increased from US$ 281 million to US$ 807 million. Gas(39.40%) and power (25.83%) attracted the largest proportion of FDI, followed bytelecommunications, cement and other industries. Adoption of BOO(Built Own andOperate)/BOT(Built Own and Transfer) models has facilitated foreign direct investment. Twoissues may be noticed in regard to FDI: first, it is attracted if there is appropriate policy and thesector is opened up; second, the future outflow needs to be taken into account. To deal with these,a sound and sustained long term macro economic policy is imperative.
Foreign Debt
The foreign debt of Bangladesh is almost entirely public or publicly guaranteed, with private
debt estimated at around 5 percent of the total debt (table-).As of mid-1998, most2

Following are the reserved sectors: (a) manufacturing arms, ammunitions and other defense equipment, (b) forest
plantation and mechanized extraction within reserved forest, (c) Production of nuclear energy and (d) printing currency
notes.

Table 3.6 Bangladesh External Debt, 1994/95-1998/99(In millions of US $, end of period)
Outstanding Debt(end-June)
Medium and long-term debt 1/
Food Credits
Aircraft loans
Petroleum loans
IMF/2
Other
Debt Service Payments
IMF/2
Other
Principal payments
IMF/2
Other
Interest Payments
IMF/2
Other
Debt indicators
Outstanding Debt
In percent of GDP
In percent of current receipts
Outstanding IMF credit/2
In percent of GDP
In percent of total debt
Debt Service
In Percent of GDP
In percent of current receipts
Debt service to the IMF/2
In percent of GDP
In Percent of current receipts 1/
In Percent of total debt service

1994/95
16,766.5
15,970.1
0.0
89.7
0.0
687.5
19.2

1995/96
15,170.4
14,524.4
0.0
153.1
0.0
568.1
-75.2

1996/97
15,024.7
14,399.1
0.0
148.3
0.0
440.8
36.6

1997/98
14,033.4
13,432.6
0.0
270.0
0.0
319.6
11.0

1998/99
15,145.0
14,540.6
0.0
251.7
0.0
353.5
-0.8

-594.0-66.5-527.5-417.2-60.0-357.2-176.8-6.5-170.3-582.5-71.5-511.0-402.0-66.0-336.0-180.5-5.5-175.0-602.9-116.6-486.4-447.8-114.0-333.8-155.1-2.6-152.5-611.9-108.4-503.5-464.7-107.0-357.7-147.2-1.4-145.8-597.6-116.3-481.3-442.8-111.0-331.8-154.8-5.3-149.5

44.6
293.2

37.6
246.0

36.6
216.7

33.2
181.8

35.0
186.6

1.8
4.1

1.4
3.7

1.1
2.9

0.8
2.3

0.8
2.3

1.6
10.4

1.4
9.4

1.5
8.7

1.4
7.9

1.5
7.8

0.2
1.2
11.2

0.2
1.2
12.3

0.3
1.7
19.3

0.3
1.4
17.7

0.3
1.4
18.3

Source: Economic Relations Divisions, Ministry of Finance; the World Bank, and staff estimates
1/ Debt recorded by the Economic Relations Division of the Ministry of Finance
2/ Excludes the IMF Trust Fundof the existing debt stock carried long maturities and concessional interest rates, with more than
two-thirds of the debt owed to multilateral institutions, including the World Bank and the AsianDevelopment Bank, which accounted for 43 percent and 25 percent of the total debt, respectively.
The bulk of the remaining debt was from official bilateral donors, mainly Japan.
Bangladesh: External Debt Management
Bangladesh has consistently remained current on its external debt obligations. The following
Table shows the Outstanding External Debt scenario up to 1997/98.

Table 3.7 External Debt Outstanding(in million US $)Debt outstanding at the
Debt service payment*
year
Disbursement
End of each FY
Principal Interest
Total
26
26
1971/72
65
65
1972/73
501
18
9
9
243
1773/74
974
71
13
58
526
1974/75
1577
56
20
36
567
1975/76
1828
50
28
22
279
1976/77
2783
65
31
34
442
1977/78
3193
89
39
50
528
1978/79
3400
108
42
66
573
1979/80
4383
85
41
44
554
1980/81
4959
92
47
45
586
1981/82
5452
136
51
85
590
1982/83
5941
129
58
71
535
1983/84
6281
170
64
106
569
1984/85
7438
184
73
111
760
1985/86
8364
233
81
152
934
1986/87
9473
289
123
166
817
1987/88
9879
294
124
170
996
1988/89
10609
302
116
186
1044
1989/90
12714
317
120
197
901
1990/91
13330
337
127
210
794
1991/92
13615
374
135
239
857
1992/93
15373
402
139
263
849
1993/94
16767
468
154
314
849
1994/95
15166
469
153
316
766
1995/96
15025
463
147
316
745
1996/97
14033
444
137
307
748
1997/98
Total
17143
3573
2072
5645
Source: Economic Relation Division, Ministry of Finance,1999* Excluding short-term loans like IMF borrowing, food loan, Biman, import of oil.
The economic relations department (ERD) under the Ministry of Finance has managed theexternal public debt of Bangladesh (both direct and publicly guaranteed) for a number of years
within a framework of an internationally used debt management software provided by UNCTAD.
Private external debt has not been monitored as closely as public debt in the past, largely because
there was no significant amount of borrowing abroad by Bangladeshi enterprises. However, theongoing boom in FDI and related inflows, together with associated future servicing obligations,have recently highlighted the need to improve the availability and quality of data on private
external debt. Technical Assistance to help improve the compilation and monitoring of private
sector external debt is being provided by the Asian Development Bank.
Debt Liabilities to Donors

Figure 3.8 Debt Liabilities to Donors (as of June 30,2000)
Others
6%
ADB
28%

IDA
41%

USA
3%

JAPAN
22%
IDA

USA

JAPAN

ADB

Others

Source: Economic Relations Division, Ministry of Finance, Government of Bangladesh

3.3 Technical Assistance in Fiscal Affairs
Bangladesh is currently going through a major public sector financial management reform
process. This is viewed as a very important and successful component of the overall public sector
reforms in Bangladesh. Many international organizations providing technical assistance in fiscal
affairs like World Bank, IMF, and DFID. There are also some country specific technicalassistance especially from Government of UK Norway and other countries. Since independence
in 1971 and till FY 1999/2000 the total foreign aid to Bangladesh is around 36,344 million dollar(Appendix-A2). Project aid is always at the top and occupies almost 50 percent and is basicallyused for infrastructure and human resource development. The following table shows the projects
that are for the technical assistance in fiscal affairs;
Overall Technical Assistance in Bangladesh (At a Glance)Table 3.8 Commitment and Disbursement of Grants to Bangladesh (in Fiscal Affairs)(Million)
Donor/Category/Description/user
agency/Agreement Date
1) ADB(G01)
Project Aid
1.TA for Insurance, pension andprovident fund reforms
05.08.1998
2.TA for the efficiency
enhancement in fiscal
management 10.09.98
3.TA for capacity building for
Security and Exchangecommission(SEC) 18.08.98
4.TA for est. of a framework forsustaining micro-finance05.11.98
5.TA for institutional streng. Of
privatization board 18.11.98
2) IDA(G33)
1. TA for commercial banking
restructuring project (10.03.97)
2. TA for private sector
infrastructure dev project(20.11.95) (Japanese Fund)
3) Norway(G59)
1. Capacity building for mgt offoreign aid in BGD 15.11.99
4) U.K.(G91)
1. Reforms in budgeting &expenditure control project(phase II)(13.11.94)
2.Enhancement training facility of
Financial mgt academy 15.06.99
3.Reforms in Govt Auditing Project(TA) 7.12.99
4.Strengthening and modernization
of VAT administration (NBR)
14.11.99
5.Trade Policy Capacity building
project (Ministry of Commerce)
30.03.2000
5) UNDP(G86)
1. Support for Monitoringsustainable human development
in Bangladesh 24.11.94
2.support to public administration
reforms 30.10.97

Allocation

Pipeline
On 1/7/99

Cancel&AdjustFresh aid
Commit.

Total
Avaiable

Disbursement

Pipeline on
1/7/00

US$
0.5

0.5

0.0

0.0

0.5

0.1

0.4

0.7

0.7

0.0

0.0

0.7

0.3

0.4

1.1

1.0

0.00

0.0

1.0

0.5

0.5

0.8

0.8

0.0

0.0

0.8

0.25

0.55

0.44

0.44

0.0

0.0

0.44

0.04

0.4

US$ 0.93

0.43

0.0

0.0

0.43

0.23

0.20

Yen 53.800

153.800

0.0

0.0

153.800

0.153

153.647

NKR
9.4

0.0

0.0

9.4

9.4

3.911

5.489

STG
9.814

2.882

0.0

0.0

2.882

1.487

1.395

2.92

2.920

0.0

0.0

2.92

1.328

1.592

0.865

0.0

0.0

0.865

0.865

0.523

0.342

1.02

0.0

0.0

1.02

1.02

0.221

0.799

0.56

0.0

0.0

0.56

0.56

0.0

0.560

US$ 1.660

0.146

0.77

0.0

0.84

0.0

0.84

1.304

1.044

0.0

0.0

1.044

0.27

0.774

Source: Economic Relations Division, Ministry of Finance, Government of Bangladesh
Details of some of the TA programs are given below:
ETAC(Excise, Tax and Customs) Project: This was a data computerization project started in1990 funded by the World Bank and continued till June 1999. As per the TAPP the total project
expenditure was 245.11 million taka which finally reduced to 195.21 million taka. The major of
the share was project grant of about 173.83 million and rest 21.37 million shared by GOB.
Budget allocation was done as 15.92%for consultants(international), machinery 27.75%,

manpower 17.83%, foreign training 12.49%, local training 8.17%, local consultants 2.02% andother costs 15.82%. In 1998 the project was revised and some other activities included for database management of VAT with the name of ASYCUDA(Automated System for Customs DAta).
The main outcome of the projects are;a) Establishing VIS(VAT Information System) cell, CIS(Customs Information System)celland R&S(Research and Statistics)Cell for the National Board of Revenue(NBR);b) Establishment of TIN(Tax Identification Number) cell to allocate TIN for each taxpayer;c) Establishment of IT IS(Income Tax Information System) for income tax purpose and toefficient management of information, return processing and monitoring;d) Computerization of R&S cell etc
Shortcomings of the Project;a)as per TAPP(Technical Assistance Project Proposal), VAT Revenue Mapping was not
successful;b) Establishing valuation cell and a computer network among the tax offices has not done;
Reasons behind the shortcomings identified are;a) Unwanted delay for getting concurrence from World Bank which obstacles thepurchasing of computers and accessories;b) Insufficient manpower to run such a project;c) Lack of coordination among different wings and subdivisions and weakness of project
activities; andd) Administrative failure to coordinate the activities of related Ministries/ Divisions.
CAM-1 (Customs Administration Modernization-1): The project is under the ministry ofIndustry of Bangladesh Government and funded by IDA. The project is one of the main
component of Bangladesh Export Diversification (BDXDP) and simultaneously the first step of
the Revenue Administration Modernization Program (RAMP). CAM-1 project started its
operation in August 1999 with a budget of 9.61 Million US$.
Main objective of the project are;a) reform and simplification of customs procedures regarding export;b) shift to post entry audit for bonded warehouse imports;c) bring the private sector (trader) as the true partner of export reform through awarenessprograms such as training, seminar and publication;d) adoption of a system approach to facilitate the diversification of exports by having
electronic information to support speedy processing, effective post event audits, risk
management and policy decisions.
RIBEC (Reforms in Budgeting and Expenditure Control): RIBEC is the core project of thefinancial reforms funded by the DFID and has been operational in it’s present form since 1995. It
is now viewed as being one of the most successful projects in the better governance area in
Bangladesh, with a growing international reputation.
Achievements to date;a) National Budget Produced by computer;b) All chief accounts offices computerized and accounts consolidation system implemented;c) New classification of national budget in line with Government of Bangladesh and IMF
requirements developed and implemented;d) Financial Management Academy (FIMA) for training of Senior and mid level officers
across the government in financial areas created and operational;

e) Core financial rules and regulations updated; andf) 7000 GoB officers of various levels received orientation on the need for reforms, training
in accounting and budgeting in new classification, with a further 500 trained in IT skills
FIMA(Financial Management Academy) Project: FIMA is created to the auditing andaccounting needs of officials of the Audit and Accounting Department.
FIMA project achievements are;a) About 170 senior GoB officers of different Cadres and Ministries received financial
management training through 6 MAAB (Management, Auditing, accounting andBudgeting) course;b) 22(Male and female) complemented post-graduate diploma in Government Managementfrom University of Ulster, Northern Ireland; andc) Number of other courses like BEST (Building Essential Skills for Trainers), TIBAS(Training in Budgeting and Accounting System), TASK (Training for Accountability Skills
and Knowledge) and TEAM (Training for Excellence in Accountable Management).
RIGA(Reforms in Government Audit Project) The project commenced in April 1999 as to
update the government audit system and its improvement.
Tasks for RIGAa) Update the Audit Code of the Government of Bangladesh;b) Update audit manuals in Local Government Audit, revenue audit, and civil audit;c) Introduce performance or value for money audits;d) Implementation of improved audit techniques; ande) Skills improvement for auditors at all levels.
Further areas of financial Sectoral reforms
The key stakeholders in GoB have on many occasions identified the following further areas ofreforms;a) Improvement in the quality of Government Commercial accounts;b) Macro Level Finance/ GFS;c) Food accounts, railway accounts and defense accounts;d) Simplification and computerization of Civil Service payrolle) Pension and Provident Funds;f) Updating financial rules and regulations of other departments;g) Improvement of other departmentalized accounts; andh) Reforms in banking.
Country Specific Technical Assistance: Japan
Japan’s ODA to Bangladesh
Japan acknowledged the independence of Bangladesh in 1972, well ahead of other westerncountries, and has consistently maintained friendly relations with it since that time. The twocountries share common values and systems such as freedom, democracy and a market economy,
and have been cooperating on global issues such as world peace , development and human rights
at the united nations and other international organizations
Objectives of Japanese aid to Bangladesh
Japan and Bangladesh enjoy consistently friendly relations centered on economic and technicalcooperation. Bangladesh has pro-Japanese sentiment and great expectation for Japanesecooperation. Bangladesh is engaged in vigorous diplomatic activities in UN, NAM, etc,

recognizes itself as a representative of the developing countries, and exerting efforts to strengthen
cooperative ties among South Asian countries. Japan’s strengthened relations with Bangladesh
will contribute to its relations with other developing countries, and to the political stability inSouth Asia. However, in implementing aid, full cognizance of the enormous demand for aid in
the country and it capacity to service its debts is necessary.
Bangladesh's Position in Japan's ODA
Japan is providing assistance to Bangladesh, taking into account the following factors.
1) Bangladesh maintains traditionally friendly relations with Japan.
2) Bangladesh has the largest population (about 120 million) of the Least among Less
Developed Countries (LLDCs) and has a large demand for aid.
3) Bangladesh is often hit by floods, cyclones and other natural disasters.
4) Bangladesh has been moving ahead with structural adjustments, including
democratization and economic liberalization since 1991.
Bangladesh is the sixth largest recipient of Japanese bilateral aid (based on cumulative net
disbursements up to 1998) and Japan was the largest provider of bilateral aid to Bangladesh in
1997.
Priority Areas for Japan's ODA
Based on studies and research concerning development conditions and tasks in Bangladesh andits development plans, as well as policy dialogues between Japan and Bangladesh, including theHigh-Level Mission on Economic and Technical Cooperation sent to Bangladesh in April 1990
and subsequent policy dialogues, Japan has given priority to assistance in the following areas.
1) Agricultural and rural development and improvement of agricultural productivity2) Improvement of the social sector
3) Improvement of the base for promoting investment and exports
4) Disaster prevention and management
As related tasks cutting across these four priority areas, Japan will also strengthen its efforts toaddress environmental issues, human resources development and institutional building.
Matters for Consideration• Bangladesh must step up its self-help efforts, including efforts to improve its capacity toabsorb aid by strengthening aid implementation systems.
• There is room for greater utilization of Japanese grant aid for debt relief and collateralfunds.
• Consideration should be given to greater use of grant aid and to the repayment status of
yen loan debts, which have not been covered by grant aid for debt relief since 1998.
The Current Economic Situation in Bangladesh and Tasks to Be Addressed(1) Current Situation
Agriculture is the major industry in Bangladesh, which is very susceptible to weather andfluctuations, and it is not self-sufficient in food. The country depends on foreign aid for more than
50% of its annual development plan budget (ADP). The present administration is moving ahead
with economic reforms while it is working to restore the country's production capacity, which
was slowed by a general strike, to attract foreign investment and control inflation. For twomonths from July 1998, Bangladesh was devastated by what was said to be the worst flood
damage of the century (amounting to 10% of the country's GDP), and it is believed that thecountry's 1998-99 GDP growth rate will be only in the 3-4% range. Following this, the mid-term
tasks of the Bangladesh government will be to restore infrastructure and increase food production.

(2) Tasks to Be Addressed• Eliminating the budget deficit and freeing the country from its dependence on foreignaid• Boosting agricultural productivity to raise the food self-sufficiency rate and diversify
agricultural production• Implementing measures to further alleviate poverty and control the country's highpopulation growth (which averaged 1.75% annually in 1996/97)• Promoting private investment• Promoting privatization of state-owned enterprises, trade liberalization, financial
reforms, other structural adjustment measures and cultivating export industries• Maximizing administrative efficiency and simplifying procedures(3) Orientation for Japanese aid(over the next 5 years)• Strengthening of the linkage between technical cooperation and economic

cooperation will continue;•••

Yen loan request for infrastructure building projects of appropriate size will beconsidered individually in light of the country’s debt service capacity and economic
effects of each project.
Aid will basically be grant aid and technical cooperation, as it is an LLDC;
Alleviation of poverty is the highest priority. A greater emphasis to be put on quality ofaid. Aid will be provided to encourage self-help efforts so that Bangladesh does notdevelop an excessive dependence of foreign aid, with the consideration of (i) the
demand for resource in the country, (ii) its ability to absorb aid, and (iii) its ability toservice debt.

Partnership
The partnership and cooperation between the Government of Bangladesh, donors and NGOs isof crucial importance. The coordinated development approach is intended to maximize the impact
of cooperation and bilateral partnerships. For example, Japan-US Common Agenda cooperation
and Japan-UNICEF cooperation for Bangladesh is one of the world’s most successful partnershipand cooperation.
Past record Japan’s ODA loan and Grant Aid to Bangladesh
Table 3.9 Japan’s ODA loan and Grant aid to Bangladesh
Year(JFY)
Loan
22.967
1993
21.0791994--1995--199615.252
1997
16.412
1998--1999Source: Ministry of Finance, Government of Japan,2000(in billion yen)
Grant Aid----20.495
20.73623.80421.32727.219Japanese Aid and Bangladesh
Donor wise details of aid flows in Bangladesh show that Japan’s position is always at the top.
However the aid pattern and other assistance are heavily composed of food aids, commodity aids
and grants (Appendix-A3). A summary of the commitment and disbursement of Japanese grants
to Bangladesh shows that most of the sanctions are as debt relief grant and infrastructuredevelopment (Appendix-A4). However, the issue of human resource development and other IT
related technical assistance are ignored which can hopefully satisfy to countries own capability ofresource generation and maintenance. There is real scope of criticism on these aspect. Hopefully
Japan can take initiatives to restoring imbalance of human resource development of Bangladesh
as a timely policy alternatives.
ADB (Asian Development Bank) Technical Assistance
An ADB financed project launched in 2000 named as Long-term Financial Markets
Development under the finance sector. The executing agency is the central bank of Bangladesh(Bangladesh Bank). Ministry of Finance, Securities and Exchange Commission, and Investment
Corporation of Bangladesh will be consulted during TA processing.
Rationale of the Project: The banking sector is basically insolvent and estimates of theoutstanding loan portfolio in default range from 30 to 50 percent. This is attributable mainly tothe financial status of the four nationalized commercial banks(NCBs) and 8 development financeinstitutions(DFIs), which holds about two-thirds of the total loans outstanding. At this moment
there remains a robust demand for term local currency lending, which is essential for thedevelopment of private commercial activities.The primary beneficiary will be the industries andcommercial undertakings, which are currently facing great difficulty assessing term local
currency funds. The secondary beneficiaries will be the Private Commercial Banks (PCBs),
which will develop in-house capability at term credit analysis.
The Bank will lend OCR funds to Bangladesh Bank(BB) and BB will relend local currency fora period upto 10 years. The unique feature of this project is the emphasis on the transfer ofpractical term credit analysis skills and practices from the well-established FCBs to the domestic
PCBs.The technical assistant and other lending(in pipeline) for FY 2000-2002 for the Finance andIndustry sector in Bangladesh is about 12 00,000 US$.
ADB’s operational program also includes the Insurance and Pension Funds Development
project in 2001. The proposed project will (i) strengthen market regulation and supervision ininsurance and pension/provident funds; (ii) strengthen and unbundled the Sadharan Bima
Corporation (general insurance) and Jiban Bima Corporation (life insurance); (iii) diversity
insurance products; (iv) Computerize data records of the public sector pension schemes; and (v)adopt policies and promulgate laws for development of a private sector provident fund, among
others.
ADB will also provide TAs to assist the Government to speed up financial market reforms. The
Capacity Building for SEC(Securities and Exchange Commission) and Stock Exchanges ofBangladesh II TA in 2000 will supplement and bring to closure some of the key elements thatwill not be completed under the ongoing TA. These include operationalization of the central
depository system and investor protection fund.
Overall External Assistance
The following table show the overall external assistance in Bangladesh for the recent years.
Among the multilateral organization ADB’s contribution is the highest, however Japan leads
among the bilateral assistance program.

Table 3.10 Overall External Assistance($ million)
External Source

Past 3-5 years
Loan/Credit TA

A. Multilateral Assistance
ADB
EU
UN
WB
Subtotal
B. Bilateral Assistance
CanadaDenmark
GermanyJapan
Netherlands
NorwaySwedenUnited Kingdom
United States
OthersSubtotal
Total
Memo Items:
External Assistance as % of Current Expenditure
External Assistance as % of Capital Expenditure

1998 Approvals
Loan/ Credit TA

284.0
65.0
83.0
307.0
739.0

325.0
40.0
107.0
575.0
1,047.0

32.0
22.0
58.0
304.0
36.0
27.0
17.0
36.0
67.0
78.0
677.0
1,416.0

24.0
19.0
40.0
299.0
40.0
18.0
50.0
26.0
107.0
200.0
823.0
1,870.0

50%
57%

57%
67%

Source: Ministry of Finance, 2000
The following table shows that attaining economic growth has got utmost attention from thelending program however by sector it’s share is only 16.7% for the recent financial year.
Table 3.11 Lending program by Type and Sector, 2000-2002
Classification
I. By Typea) Economic Growthb) Projects Directly Aimed at Social Concernsc) Projects Directly Aimed at Environmental
Concernsd) Economic Growth-oriented Projects with Social
and/or Environmental Concerns
Total
II. By Sectora) Agriculture and Natural Resourcesb) Energyc) Finance and Industryd) Transport and Communicationse) Social Infrastructure
Total

2000 (Firm)

2001-2002

No.

%

No.

%

3
1
1

50.0
16.7
16.7

2
4
3

15.4
30.8
23.1

1

16.7

4

30.8

6

100.0

13

100.0

2
1
1
1
1
6

33.3
16.7
16.7
16.7
16.7
100.0

4
1
1
2
5
13

30.8
7.7
7.7
15.4
38.5
100.0

Source: Ministry of Finance,2000
3.3.1 Tax Policy
The most significant feature of the Bangladesh tax scenario is it’s heavy dependence onindirect taxes. Nearly 80% of all revenue of the government comes from the indirect taxes while
the balance is from direct taxes. The tax-GDP ratio in Bangladesh is less than 10%. However forthe mobilization of internal resources a strong and efficient tax system is necessary. There are anumber of laws relating to both direct and indirect taxes. The major direct tax is income tax. The
main indirect taxes are customs duty, Value Added Tax, and excise duty. The other minor taxes
are Travel tax, gift tax etc.
Lion’s share of the indirect taxes comes from customs duty at the import stage. The collectionof tax in this case depends on the volume of import. This again depends, in the case of
Bangladesh, on the flow of foreign aid to a great extent. Bangladesh has signed WTO agreement.
This entails scaling down and/or abolition of duties and taxes on a wide range of items. This willseverely affect the present tax structure of Bangladesh.
Bangladesh now have to generate more revenue from direct taxes. Failure to do so willseverely affect the attainment of various national priorities like poverty alleviation,industrialization, human resource development etc. Economic vulnerability will increase social
unrest jeopardizing national security. Paucity of funds will also reduce her national defense
capability and efforts and also make the country more amenable to outside pressure.
Bangladesh now seriously trying to reform her taxation policies. The main objective is thus tofacilitate new investment through both in and external sources.
Recent tax measures taken in the 1999/2000 Budget;
The recent budgets included a number of revenue measures to streamline the tax and tariffstructure, extend the VAT net, and strengthen tax and customs administration. The highlights ofthese measures are as follows:
Income Taxi) Personal income tax rates were restructured and the general basic exemption limit from Tk
75,000 to Tk 100,000ii) The exemption on interest earnings from high yielding government savings certificates waseliminated and the base of the withholding tax expanded.
iii) A presumptive tax on automobiles was introduced and existing rates on trucks and lorries
increased.
iv) The 0.25 % tax at source on exports was eliminated.
Customs Dutiesi) the tariff structure has been simplified and the top rate(including a 2.5% import duty
surcharge) reduced from 42.5% to 40%.
ii) Customs duty was harmonized at the lower rates on commodities falling under the same H.S.
Code.
iii) New exemptions to import tariffs were granted in a number of areas, and tariffs on raw
materials and intermediate goods were reduced.
VAT, supplementary duties and excisesi) The coverage of the VAT was extended to 31 new retail items and a few professional services.
ii) The electricity duty was replaced with VAT applied on a truncated basis.
iii) The exemption on the turnover tax was increased from Tk 1.5 million to Tk 2 millioniv) A 2.5% supplementary duty was introduced on imported finished goods (without domestic
substitute) subject to the top customs duty rate.
v) A 10% supplementary duty on 272 items(subject to a customs duty rate of over 5%) is to be
introduced on the date of introduction of mandatory pre-shipment inspection(PSI).
3.3.2 Tax and Customs administration
Taxation System in Bangladesh
a. Income Tax Department

The income tax department under the National Board of Revenue (NBR) is responsible for theadministration of the direct taxes like Income Tax, Advertisement Tax etc. A commissioner ofTaxes heads a zone. There are 14 taxes zones. Three more new zones have been created this year.
A zonal organization set up is shown below:
Commissioner⇓
Additional/Joint Commissioner⇓
Deputy/Assistant/Extra Asstt.
Commissioner⇓
Inspector
b.Customs and Excise Department
The Customs and Excise department under the NBR is the administrating authority of theindirect taxes. These include the Value Added Tax(VAT), Turnover Tax, Customs Duty, excise
duty, supplementary duty etc. The department is divided into nine commissionerates. Three newhave been set up in 1999-2000. The organogram of a commissionerate is shown below:
Commissioner⇓
Additional/Joint Commissioner⇓
Deputy/Assistant Commissioner⇓
Super/Principal Appraisal⇓
Inspector/Appraiserc. Land Revenue Collection structure
The Ministry of Land administers the collection of land(LDT) revenue. The land revenue
collection structure is shown below:
Commissioner⇓
Deputy Commissioner⇓
Assistant Commissioner(Revenue)⇓
Kanungo⇓Tehsilderd. Department of Registration
Department of Registration administers the stamp duty and registration fee. This set up is asfollows:
IG Registration⇓
District Registrar⇓
Sub-Registrar

e. Bangladesh Road Transport Authority(BRTA) collects the road tax, vehicle license fee etc. The
set up is;
Chairman⇓District BRTA
f. Local Government (City Corporation, Municipalities, Union Parisads)
Holding tax, revenues of public utility(power, gas, phones, water), Chowkidari tax etc. This
does not go to the national exchequer but is spent in meeting their own expenses. The local
government bodies however can meet only 40% of their requirement while the rest is subsidized
by the government (Zafrulla, Taslim and Chowdhury, 1995). There are also other sources
revenues of public utility like power, gas, phones, water etc.
Recent reforms of Tax and Customs Administrationi) Assessment procedures were simplified and measures were taken to improve accountability
and organizational structure in customs administration.
ii) Introduction of unique tax payer identification number(TIN) .
iii) The establishment of Large Taxpayer Unit(LTU) .
iv) Placement of voluntary PSI system by mandatory PSI(pre-shipment Inspection).
3.3.3 Budget and Public Expenditure Management
To strengthen budget planning and preparation, budget execution, auditing, classifying
government accounts and data reporting, establishing treasury systems, harmonization regional
budget practices, and assessing transparency of fiscal systems.
Budgetary practice in Bangladesh is included in its Constitutional framework. The constitution(Article 80-92) and the parliamentary procedure (Chapter XVI) lay down the basic constitutional
and legislative aspects of the budget.
Characteristics of Budget in Bangladeshi) It is effective during a financial year starting from July 1 and ending on June 30, next year;ii) Budget is divided into revenue Budget, Capital Budget and Development Budget;iii) The government budgeting is done on a cash basis. Both receipts and expenditures areshown in cash terms;iv) Foreign loans are reflected on a gross receipt basis showing total disbursement;v) Budget is prepared on incremental basis, on the basis of upward adjustment of expenditure
as against performance budgeting;vi) Allocation lapsing and surrendering of budgetary allocations on unspent balances.
The Budget Structure
The provisions laid down in Article 84 to 88 of the constitution of the country and subsequent
adoption of the UN system of classification of government transactions in 1983 provide for the
structure of budget in Bangladesh.
In Article 87 of the constitution the budget has been referred to as “ Annual Financial
Statement” which is a statement of estimated receipts and expenditure of the government for aparticular financial year. In accordance with the constitutional provision, the budget has been
divided into;a) The Consolidated Fund, andb) The Public Account of the Republic

According to article 84(1) of the constitution all receipts of the government on account of taxes,
income from assets, borrowing, repayment of loan etc. are credited to the consolidated fund. No
money can be withdrawn from the consolidated fund except on the expenditure voted by theparliament and the Appropriation act.
According to Article 84(2), the public accounts of the republic is that part of the annual
financial statement or budget which compromises all receipts and expenditures other than thoseof the consolidated fund. The government does not have any automatic claim on the money in the
public account of the republic but can borrow from it to meet expenditure.
Budgetary processes in Bangladesh
The Budgetary process have three stages in Bangladesh.
i) Preparation ii) Legislation and iii) Execution
Budget Preparation and Budget Cycle
The Finance Division of the Ministry of Finance is responsible for preparation of the national
budget and its submission to the parliament. The Finance Division receives estimates of
expenditure from all the spending agencies (Ministries and Divisions) of the government andestimates of receipts. These estimates and receipts and expenditures reflect the following figures(i) actual expenditure of the previous year; (ii) last year’s budget; (iii) three months actuals forthe last two years; (iv) Last year’s revised budget and (v) current year’s budget along withoriginal proposals.
These estimates are discussed, finalized and consolidated into the budget presented to theParliament. A typical budget calendar or budget cycle is shown belowa) printing and distribution of budget estimation
end-August
forms to estimating/controlling authoritiesb) Distribution of forms to the Controller General of
end-September
Accounts for obtaining reports of actual expenditure
For three months and estimatesc) Receipt of forms incorporating information fromend-Octoberestimation/controlling authorities by Finance Divisiond) Receipt of information from C.G.A by Financeend-January
Divisionf) Distribution of first edition of budget to othermid-February
Ministries by Finance Divisiong) Budget discussions with Ministries/Divisions etc
March through early/mid Aprilh) Finalization of Budget
Mid/Late April
Legislation of Budget
The budget is the most important tool of legislative control over the public purse and throughthe purse over the executive. No tax can be collected without its prior authorization and no
expenditure incurred without its prior approval. General discussion on the budget takes place
before its approval or disapproval by the members of the Parliament. The following enactments
are involved in the legislation of budget by the parliament:
a. Demand for grants; Proposed expenditure from the consolidated fund outside thecategory of charged expenditure is submitted to the parliament in the form of demand
for grants for approval by vote and the expenditure so approved is known as voted
expenditure as distinct from charged expenditure which is not subject to vote of
Parliament.
b. After the parliament approves the demand for grants, the government places before theparliament an appropriation bill seeking its approval to withdraw money from theconsolidated fund to meet the expenditure already approved.

c. Finance Act, In order to finance the expenditure contained in the approved budget, thegovernment may need to impose new taxes, or raise the rates of existing taxes. This isdone through the Finance Act(Article 81).The taxation proposals become effective on
their introduction in the parliament in accordance with the Provisional Collection of
Taxes Act, 1931.
d. The Vote on Account, The procedure allows the parliament to debate the budget
proposals and the policies of the government without interrupting normal operations.
Traditionally in Bangladesh, the government the government seeks votes on accountfor one fourth of the proposed budget. A separate appropriation act is passed for theamount of vote on account.
e. Supplementary Grant and Excess Grant; The constitutional provisions for
supplementary grant and excess grant (Article 91) allow the government to incur
expenditure in excess of the provision. The budgetary practice in Bangladesh does notmake any distinction between supplementary grant and excess grant; both are treated as
excess expenditure.
f. Unexpected Expenditure, Under Article 92(b) of the constitution, there is a provision
for making a demand for grants named “ Unexpected Expenditure to the Parliament”. It
is a lump grant, the details of the demand are not specified.
Budget Execution
After the budget along with the finance bill is passed by the parliament, its implementation
rests with the executive ministries, their attached and subordinate offices. The Secretary of theconcerned ministry/division in the capacity of principal accounting officer is responsible for
ensuring budgetary and financial discipline within his jurisdiction. The overall responsibility
however lies with the Finance division under the ministry of Finance.
In the task of ensuring the observance of budgetary limits, audit department also plays a very
crucial role. The Auditor General examines and verifies the accounts after the transactions arecompleted in order to discover and report to the legislature any unauthorized, illegal and irregular
paints, any financial practices which are unsound and any shady transactions and seeks to enforce
accountability to parliament.
Concluding Remarks:
The budgetary arrangements in Bangladesh are disorganized and unable to ensure operational
efficiency of the system. The main reasons are;
Budgeting is incremental, not performance based. As a result, the budgetary system lacks
flexibility, transparency and accountability, legitimacy and predictability. In addition, there is no
periodic review system; no spending review and no pre-budget report is done.
The World Bank’s Public Expenditure Management handbook (1998) suggests that eachcountry should try to understand how its particular institutional arrangements might have any
impact on budgetary outcomes. The institutional arrangements in Bangladesh are basically the
product of British colonial legacy, which, at present is unable to generate the essential dynamism
and flexibility in its budgetary system to make its functions in line with international best
principles and practices. As long as the institutional arrangements are not fundamentally changed,
the short run solution lies in “getting the basics right”. Bangladesh should inter alia foster anenvironment that supports performance before introducing performance budgeting, control inputs
before seeking to control outputs, and properly account for cash before introducing and budgeting.
Steps should be taken to establish external controls before introducing internal control and a
reliable accounting system is to be operated before installing an integrated financial management
system. It would be useful to have effective financial auditing before moving to performance
auditing.

5.3.4 Expenditure Policy
The role of public expenditure is quite important for development of socio-economic and physicalinfrastructure and human resource development through higher public investment. The trend ofcurrent and development expenditure and expenditure/GDP ratio since 1991/92 to 2000/01 arepresented in the following table.
Table 3.12 Public Expenditure(In crore Taka)
Public Expenditure(a+b)a) Revenue expenditureb) Development Expenditure(ADP)% of GDP
Public Expenditure (a+b)a) Revenue expenditureb) Development expenditure
(ADP)

91/92
13924
7900
6024

92/93
15060
8510
6550

93/94
18133
9150
8983

94/95
20603
10300
10303

95/96
21830
11814
10016

96/97
23576
12535
11041

97/98
25537
14500
11037

98/99
29274
16765
12509

99/00
33915
18444
15471

00/01
37133
19633
17500

11.6
6.6
5.0

12.0
6.8
5.2

13.4
6.8
6.6

13.5
6.7
6.8

13.1
7.1
6.0

13.0
6.9
6.1

12.7
7.2
5.5

13.3
7.6
5.7

14.4
7.8
6.6

14.5
7.7
6.8

Source: IMED and Finance Division, Ministry of Finance,2000
Expenditure of Local Government
There are four tier government in Bangladesh. Those are Zilla Parisad(District level), Upa-Zilla
Parisad(Thana Level), Union Parisad, and Gram Parisad(Village level). The development
activities are centralized and the government itself control the expenditure. The organizations areaccountable to the Ministry of Local Government and Rural Development(LGRD). The
government still in the way to formulate social safety net schemes. The local government only
responsible to collect some fees, charges and utilities. They can meet only 40% of theirrequirement while the rest is subsidized by the government. However their earning does not go to
the national exchequer but is spent in meeting their own expenses.
The finance division under the Ministry of Finance allocate the budget on their demands andaudit the expenditure incurred by the local governments. External Resources Division(ERD) is
responsible to formulate expenditure policy of foreign aid and grants including the allocation ofTechnical Assistants(TA). There is an Executive Committee of National Economic Council(ECNEC) chaired by the Prime Minister that approves large scale expenditures for the medium
and long term development projects.
Revenue Expenditure on Social Sectors
A major share of revenue expenditure is used to pay the salary and allowances for thegovernment employees which accounts more than 32% in recent years. However social sectors
has been accorded increasing priority in revenue expenditure in current years. Current
expenditure in social sectors since 1991/92 through 2000/01 is presented in the following table.
Table 3.13 Revenue Expenditure on Social Sectors(In crore Taka)a. Education and Religion
b. Health and populationc. Youth, Sports and Cultured. Social services
Total

91/92
1393
431
23
51
1898

92/93
1688
516
38
54
2296

93/94
1770
607
43
61
2481

94/95
2023
685
38
73
2819

95/96
2169
730
42
79
3020

96/97
2310
769
41
89
3209

97/98
2706
813
64
99
3682

Source: Finance Division, Ministry of Finance (Based on revised budget 2000/01)

98/99
2988
887
55
141
4071

99/00
3279
972
73
177
4501

00/01
3368
1112
59
186
4725

3.3.5 Fiscal Federalism
Local Government
Bangladesh is a small country thus there is no such intergovernmental tax assignment problem.
National Board of Revenue is the sole authority working under the Ministry of Finance forcollecting both the direct and Indirect taxes. The two wings assigned for this task are the Income
Tax department and Department of Customs, Excise and VAT. The board centrally directs thetaxes zones to collect revenue as per the pre-determined budget. The recent scenario is verysatisfactory for the income tax after introducing self-assessment system and adopting large-scale
withholding tax system for all kinds of taxpayers. However the situation is not satisfactory for the
Indirect taxes especially at export and import level.
The government has recently trying to establish strong local level administration as a step ofpossible decentralization process. However it is noteworthy to mention that all their activities
heavily depends upon the allocation from central government. It would be recommended tostrengthen the local bodies by truly decentralizing power that they can gradually attain selfsufficiency and can meet own development funds.
Private Sector
In tune with the current global trend, the government has committed itself to the market
economy and has been pursuing policies through which the private sector will play the dominantrole in the country’s development efforts. In all cases where public ownership is retained,
efficiency must be increased through improving management, decentralizing the decision making
process, ensuring commercially viable operations and following economic pricing of all goods
and services. Success in management is to be rewarded through appropriate incentives while
inefficiency and poor performance will bring punitive strategy. Public sector monopolies should
be progressively brought into the competitive areas that private sector can be well suited toperform efficiently.
While social direction of private enterprise in certain fields may be necessary to safeguard thepeople’s interest, private enterprise will continue to be the main lever for development in all areas
where they have demonstrated satisfactory performance or are likely to be more efficient. In
particular entrepreneurship should be encouraged through training, extension services, input
supply, credit and market facilities. Emphasis should be given on strengthening the financial andcapital markets through appropriate policy measures so that there can be a better mobilization of
resources, in particular private resources from abroad, for productive investments.
Banking & Insurance
At the moment financial sector reform programs are underway. Private banks and insurancecompanies with few exceptions are functioning creditably. Uttara, Pubali and Rupali Banks whichwere formally owned by the GOB were privatized. Shadaran Bima Corporation's (General
Insurance) 49% shares are contemplated to be off loaded in the local stock markets soon.
Opportunities for the Foreigners
The Industrial Policy 1991 and its recently announced amendments, the associated reforms in
trade policies and fiscal and taxation policies now augur well for investment by the foreign
nationals and companies and also non-resident Bangladeshi nationals. No approval is required forany investment by the foreign investors in any sectors of the economy except for a few areas(strategic ones) which are still reserved for public investment only. The foreign investment(promotion & protection) Act, 1980 guarantees protection to foreign investment against
nationalization and also guarantees equitable treatment. Bangladesh is a signatory of Multilateral
Investment Guarantee Agency (MIGA) of the World Bank group, Overseas Private Investment
Corporation (OPIC) and International Center for Settlement of Investment Disputes (ISCID) andtherefore, also guarantees investors protection against political and other risks. Following
facilities are also available for foreigners and non-resident Bangladeshis.
i) Foreign investment with 100% foreign equity holding;ii) Repatriation of all post tax dividends, capital, and capital gains is permitted fully;iii) Employment of expatriate technical and professional personnel is allowed;iv) Remittances of 50% of the salary of foreign nationals employed in local companies isallowed;v) Remittances of savings from earnings, retirement benifits, personal assets of individuals
employed in recognized industries on retirement/termination of service is allowed;vi) Foreigners employed in recognized industries are exempted from income taxes for first 3
years;
vii) Multiple entry visas are allowed;viii) Relief is given from double taxation;ix) Re-investment of reportable dividends is treated as new investment;x) Foreign investors have unhindered access to local banks and financial institutions for
obtaining long term loans and working capital loans;xi) Enterprises with foreign ownership may remain private limited companies. In the case of
public limited companies, the public offering of shares is optional;xii) Foreigners are allowed to invest in shares and securities through stock exchange etc
Privatization Board:
The Privatization Board which came into being in March, 1993 is entrusted with the overall
responsibility of privatizing State-Owned Enterprises identified for privatization, whether small,large, profitable or non-profitable. The Board is now headed by a chairman with the rank andstatus of a State Minister to the Government. The Board consists of two full-time members andtwelve part time members including six Members of Parliament. The Board has been placed
under the administrative jurisdiction of the Cabinet Division which is headed by the Hon'ble
Prime Minister. The Board reports directly to the Cabinet Committee on Economic Affairs which
is chaired by the Hon'ble Minister of Finance. Ministries having SOEs under their control have
either set up or in the process of setting up Privatization Cells for assisting the Privatization Boardin identifying, preparing, processing, implementing and monitoring SOEs for privatization.
3.3.6 Other Special AssistanceCommunication Computerization and Filling System
Throughout the world, the pace of changes in computerization and electronic communications
are occurring so fast that any nation unable to adjust with these swift changes will miserably lag
behind and fail to compete with others. Tax administration must, therefore, adjust itself to thesechanges and help the country to move forward and attain the capability to collect revenue for thecountry.
The age-old filling system in tax offices needs to be replaced by computerized filling system.
The system of records and accounts keeping and reference making needs to be changed. FAX andE-mail should be introduced in all tax offices and thus necessary training should be provided. To
achieve this target, a program should be taken for computer training and procurement of hardware
and software. This is the very area for that can be improved with the help of any bilateral or
multilateral financial aid and technical assistance.
Development of National Statistical Activities
A sound and comprehensive statistical system with adequate organizational structure andnetwork is a functionally essential ingredient of the country’s tax administration planning anddevelopment process. Currently the institutional structure of the national statistical system ofBangladesh comprises the National Statistical Council as the apex body. Bangladesh Bureau of
Statistics (BBS) is mainly in charge of the collection, collation and dissemination of official
statistics.
A small sub-division is working so far under the National Board of Revenue(NBR) for the
research and development of tax related data. It must be strengthened to meet the various current
needs. It would be a good approach to have such an organization under the Ministry of Financefor this purpose. It must include the tax wings, Banking and insurance sector, Securities andExchange Commission etc.
At this moment it is an urgent need to formulate a database on the taxpayers with all theirrequired information as income, wealth, business and corporations. A good cooperation is alsoneeded among all the sectors to update the database, which will play important role to check tax
evasion.
Timely data dissemination will be an essential part of data generation process of Statistics andResearch (S&R) wing. Innovative and newly evolving methods of data dissemination such as
development of web site for dissemination and exchange participation in GDDS (General Data
Dissemination System) of IMF should be progressively adopted.

3.4 Country Specific Technical Assistance Requirements
Technical Assistance for both macro-planning and sectoral investment program is very crucial.
Flow of technical assistance can play a major role in strengthening the development process by
way of transferring technology and skill. Technical assistance should be demand-oriented rather
than supply-based and it should aim at the gradual up gradation of skill-base of the recipient
country. Technical Assistance should be united as far as possible and promote technicalcooperation among developing countries. One of the most difficult problems associated withtechnical assistance in the synthesis between donor preference and the priority of the recipient
country. The problem of divergent priorities, time framers, attitudes and preferences on manyoccasions may turn out to be of critical significance and cause delay. The following area can be
pinpointed where technical assistance is needed.
I. Tax Reform Planning
In the process of economic and social development, the governments in a majority ofdeveloping countries has to take the prime responsibility. Bangladesh is no exception but the so
far improvement it has been achieved even after thirty years of independence is not good enoughto attain her sustainable economic development. The prevailing Tax-GDP ratio is only below
10% and much of its share comes from indirect taxes. There are certainly no remedies except
broadening its tax base .The entire agriculture sector is out of income tax net. Revenues fromimport as well export duties in future must be reduced to cope with world trends and treaties.Thus
the only way in front of the country is to expand its tax base relying on direct taxes.
Taxation can not only help to bridge the gap between savings and investment but can also be
used as one of the instruments for resource allocation, income redistribution, and economic
stabilization. Thus a long term tax reform planning and formulation of a development-oriented
tax structure is a timely concern as an integral and forward-looking process of decision making.
Such continuous and long-term tax planning will need a framework, a methodology, and anorganization. It must function within the framework of a development plan and evolve a
methodology for tax structure evaluation and change so as to contribute to the stand objectives
and strategy of a development plan. In doing so, tax planning must also recognize the feedback
generated by the tax administration and annual budgetary process.
The country now needs technical assistance in tax reform planning which must be based on the
country’s actual need. In the past the so far assistance received are mostly designed by the donor

agencies and International organizations. However it is noteworthy to infer that to become
successful in revenue management and administration the changes should coincide with the needs
and aspiration of the nation as a whole.
II. Financial and Budgetary Management
Bangladesh now needs to reform the public sector financial management system as an obvious
part of her overall public administration reforms. There is a lack of adequate and accurate
financial information systems and procedures of accounting and bank reconciliation (Khan et al,2000). The budgetary system is cumbersome, repetitive and overlapping which seems to perform
inefficiently.
The role of government is obvious in maintaining a well-balanced financial and budgetary
management. Political harmony also plays crucial role for the maintenance of government
activities. The financial information system should be updated in all the sectors. Thus it is now
very urgent to establish a modern database establishment.
III. Financial Rules and Regulations
There is lack of updated, comprehensive and easy to use financial rules and regulations. The
tax laws, regulations and ordinances are not compiled and circulated to the expected users in time.
The tax law for the income tax enacting is a government ordinance of 1984.The Customs Act
prevailing is also commenced in 1969 and before the country’s independence. Necessary
amendments follows almost every year which needs to be updated strictly and regularly that canhelp by guiding the tax officials towards better tax administration and examination. It is also
helpful for the individual taxpayers and corporations for better tax planning. Thus technicalassistance is needed to update the financial rules and regulations that can help attaining better
earning of internal resources.
IV. Human Resource Development
A strategy of human resources development is a precondition for gainful employment
generation and sustainable development. Planning for sustainable development, in turn, requires
an emphasis on an integrated approach. In Bangladesh, with two primary resources, man and land,
the former overwhelming the latter, existing inequality in the distribution of land can be mitigatedby equitable development of human resources and equitable access of all to the benefits ofdevelopment.
There is an acute inadequacy of trained manpower and a training system to meet the tax
management needs across the government. Training itself is a continuous process. Maintenanceof the trainees thus is also important now a days to keep updated their knowledge. The frequentchanges of both domestic and international laws and regulations demands the government toexecute its officials into a recurring training program to be ‘knowledge workers’. Through thisprocess self-sufficiency can be attained to sustain better manpower in this sector. The limitationof government for both financial and technical impedes the process. Thus donor agencies shouldcome forward with various assistance to achieve this goal.
V. Good GovernanceAccountability to the people, transparency, efficiency and incorruptibility in conducting thebusiness of government and, above all, non-discriminatory application of the laws are major
features of a good government. In case of taxation it is more urgent. However an action plan isneeded to design a legal framework for strengthening the mechanism for law enforcement andspeedy delivery of justice, tax administration reform and downsizing of the government. It will
also require redefining the role of the state and reorienting the mind-set of the bureaucracy.
There is also considerable scope for improvement in administration that is presently
characterized by shortage of properly trained manpower in many key-fields with surpluses inother fields. Anomalies and inadequacies also exist in personnel policies and careeradministration and planning. With a view to improving the personnel management andadministration in the country, the personnel management information system is urgently needed.
Computerized record keeping and data processing system is also crucial for storage and retrievalof personnel job training and other records. A rationalized and codified personnel manual will
reduce the time and manpower now utilized to oversee procedural compliance.
VI. Micro credit
Empowerment of the poor is contingent on their access to resources, which in turn, enhances
the productive capacity of the poor and helps alleviate poverty. This is the vision on which
Grameen bank launched its innovative micro credit banking system to reach the poor, who havenothing to offer as collateral for borrowing from the conventional banking system. The success ofGrameen Bank has created optimism about the viability and validity of the innovative approachof reaching the poor with credit they desperately need. The delivery of micro credit need to beassisted by appropriate training and motivation, formation of associations, arrangements for
supply of inputs and provision of market outlets for the sale of products produced by the medium
and small entrepreneurs. Tax measurements should be a taken that will help to extend the micro
credit and related activities in future.
The Fifth Five year Plan (1997~2002) recognized that the poor are assets rather than liabilities,
and if ensured access to vital inputs like credit, they can contribute substantially to the growth
process. As such, there is a necessity for implementing the philosophy of micro credit concept.
Government’s role should be reinforcing its efforts to generate employment opportunities andself-employment at the grass root level. The plan should envisages to develop a productive microenterprise sub-sector to provide profitable self-employment to the rural people supported by bothpublic and private sector institutions. The following steps can be taken as to;a)establish viable micro enterprises through rural family entrepreneurs by providing
counseling and other advisory services from the relevant government and nongovernment institutions and organizations;b)undertake programs for skill development through training and dissemination oftechnologies at grass root level;c)establish a separate credit line in the banks and financial institutions for the microenterprises and entrepreneurs and to develop sustainable program of services to meet thecredit needs of micro entrepreneurs and to facilitate their access to financial resources forinvestment in micro enterprises; andd)establish private sector financial intermediation services to develop the market for credit
to micro entrepreneurs.
The donor agencies can help to achieve this goal through guidelines and necessary technicalassistance.
VII. Resource Mobilization
Currently, Bangladesh is dependent on foreign aid for around 50 per cent of its development
outlay. Exports pay for less than half of its imports. This dependence on foreign aid has had
several undesirable consequences. Heavy dependence on aid prevents realistic annual
programming of development activities. It has also serious effects on the choice of technology.
For all these reasons, reducing dependence on aid by mobilization of a greater amount ofdomestic resources and increasing export earnings should be an important element of thecountry’s development strategy.
Economical use of resources can also be achieved by holding down the expenditure on public
administration with improvement in the quality of services. So there is a considerable scope ofmobilizing more resources out of existing taxes through overhaul and improvement of the tax
collecting machinery as well as through widening of the tax-net.

VIII. Macro Policy Reforms
Institutionalizing an economic and dynamic macroeconomic policy is needed to implement toattain macroeconomic stability. Such a macro policy regime will increase savings and willchannel savings into productive uses and eliminate growth-retarding distortions in the tax systemand other distortions in the relative prices of factors of production due to public policies, and at
the same time maintain overall macroeconomic stability.
The basic resource mobilization strategy should be to limit the size of the budget deficits bystronger revenue initiatives and restraints on revenue expenditure. If these measures are
implemented effectively, they will, in the medium term, achieve three things- first, the attainmentof macroeconomic stability; second, improvement of public savings; and third, lessening theburden of public debt.
Experiences of developing countries show that the performance of the private sector issignificantly depended on macroeconomic stability. Thus prudent fiscal and monetary
management is an essential instrument for bringing about this change. The future need are as
follows;a)Financial Sector Reform Program(FSRP):A sound financial system is crucial for thefunctioning of a dynamic private sector and with this end in view, the FSRP was initiatedin 1990. Bangladesh Bank(BB), as the central bank of the country, monitor theobservance of rules and regulations in order to ensure monetary stability. A bankruptcy
law has been enacted recently to deal with the problem of recovery of overdue loans andto bring bank discipline in the banking sector. Such steps are expected to increase thevolume of bank finance as well as to ensure greater efficiency in the allocation of bankresources to the private sector, particularly to increase export.
b)Trade Policy Reforms: Trade is an engine of rapid growth and development. Until
recently, the trade policy in Bangladesh has been characterized by import restrictions,insufficient export incentives and wide array of regulations constricting private
investment. Both tariff and non-tariff barriers contributed to the high effective rate ofprotection of the domestic industries and created an anti-export bias in the system. The
government has been steadily liberalizing the foreign trade regime by reducing directcontrols and tariffs. The custom duty has largely been rationalized and duty on import ofcapital machinery for export-oriented industries has been withdrawn to make suchindustries more competitive. The growth of exports in recent years has largely been due
to factors such as liberalization of the economy, supply of inputs at world prices,
GSP(Generalized System of Preference) facilities and simpler administrativerequirements and credit supports.
c)
Privatization: The policy of privatization, if properly conceived and implemented, canensure substantial benefits including higher productivity, growth of output andemployment, besides, lesser stress on governmental resources. Such a policy also enables
the government to focus more on policy making to create an enabling environment. The
government is committed to the process of privatization, and with this end in view, theprivatization board has been established in 1993 which finally strengthened by forming a
privatization commission headed by highly powered bureaucrats. So far thirteen sectors
have been identified for this process including the banking and insurance sector followedby tele communication and others. However the progress is still not satisfactory and themany State Owned Industries (SOEs) are running as burden to the government.
IX. Monitoring research and Evaluation
Monitoring implementation of development projects is a relatively new idea but an integral
part of development projects specially for fiscal affairs. Bangladesh experiencing monitoring
problem that is needed to evaluate goals of the development projects. A well organized unit forthe monitoring of projects under fiscal affairs is needed to equipped with trained personnel. The
current Management Information System(MIS) suffers from a number of limitations having poor
linkage with supervision, monitoring and local level planning. The system is not tailored to suitdifferent levels of program managers. There exists need for improvement in the area of electronic
data processing capability, data validation, data sharing and dissemination. Moreover, the sectorwide program approach will require re-organization of the systems so as to improve management
capabilities. Operational research is an important tool for monitoring and evaluating the program
performance and results. The current allocation in this sector is highly inadequate for conducting
research. Institutes that are involved in research are also not suitably developed. For fiscal policy
research and continuous monitoring and evaluation new technical assistance is needed.

3.5 Conclusion: Where We Stand and Where We Go
In the process of economic and social development, the government in a majority ofdeveloping countries has assumed the principal responsibility. Consequently public expenditures
have grown rapidly. Taxation is the main source of finance. So if capital formation and higher
growth rate is to be achieved, it is essential to step up the tax efforts.
Ever since liberation in 1971, Bangladesh has been striving to achieve economic emancipationof her people. One of the main cornerstones of this goal has been to attain self-sufficiency inproviding for her various socio-economic objectives from her own resources. This needs as
maximum mobilization of available internal revenue and gradually diminish and do away withthe dependence on foreign assistance.
Direct Taxes:
At present the main problem areas of the Income tax system in Bangladesh can be categorizedas;a) Narrow Tax Baseb) Tax Evasionc) Inadequacies of Law andd) Inadequacies of Administration
Narrow Tax Base:Tax base in Bangladesh is one of the lowest in the world. In the population of 128 million there
are only about 700 thousand or about 0.54% of the population is in the tax net. Of these registeredtax payers only about 300 thousand actually file any return and pay any tax. To expand the tax
base urgent steps are needed.
i) The concept of income in the law needs to be broadened;ii) Rebates and exemptions need to be reduced;iii) Extensive survey work need to be undertaken andiv) Taxpayer education/ assistance has to be extended.
Tax Evasion:
Tax evasion in Bangladesh has been taken a threatening proportion. The immediate victim isrevenue. Tax evasion also defeats the principle of equity. This leads to a parallel black economy
the size of which in Bangladesh is said to be to the tune of US$ 1.2 to 1.5 billion. The reasons forthis situation are many, leading those are complex tax law, lack of social security, coordination
gap among different government agencies and financial institution followed by inefficiency andcorruption. To curb evasion:i) The law and procedures need to be simplified;ii) Collection and cross checking of data and information to be ensured;iii) Taxpayer education and motivation has to be increased;iv) Banking and accounting practices has to be changed;v) Tax evaders must be punished.
Legal Inadequacies:
The current Income Tax Ordinance came into existence in 1984. Since then it has undergone somany changes that the laws needs to be rewritten. To make the act more upto date and effective
the following measures to be undertaken;i) Simplicity and clarity, not legal jargon, should be the guiding principle;ii) Rebates and exemptions should be minimized to come straight to a taxable thresholdincome;iii) Tax holiday and exemption from tax of newly established industrial undertakings should be
restricted for limited timeframe;iv) All taxpayers should be brought under Self Assessment System(SAS) and post audit should
be strengthened;v) Tax evasion should be made a criminal offence;vi) Litigation aspect to safeguard revenue has to be improved;vii) A central Withholding taxes zone should be created andviii)VAT should be administered by Income Tax authorities.
Administrative Inadequacies:
Simplicity is an important element in any successful administrative reform. The administrationmust be provided with simpler and hence potentially enforceable laws to administer. To attainthis goal the current structure of administration needs to be completely overhauled. The following
steps will help this process;i) Recruitment, Training and pay need to be re-examined. “Fast Track” career planningshould be offered;ii) Demand creation work should be separated from collection work;iii) Logistical support of the tax department has to be increased;iv) Internal audit system has to be strengthened;v) Computerization and creation of data bank should be quickened;vi) Incentives should be provided to the revenue officer as to encourage efficient collection ofrevenue (Like in Japan, revenue officers receive 10% more salary than others)
To attain expected improvement in this sector, the inadequacies should be mitigated. Like
many other developing countries Bangladesh Tax system is plagued with various built-in sociopolitical and structural weakness. Bangladesh is in a crossroad today. Crucial steps are to be taken
to gear up and update the tax policy and administration. Successive governments have taken sometentative steps, at times on the urgings of World Bank and IMF, in the desired direction. But morevigorous efforts are needed. Some urgent and crucial decisions may have to be made and ways
need to be found to make Bangladesh a thriving and self-respecting nation.
Indirect Taxes:
In the wing of indirect taxes some recent reforms have been carried out. The Customs
Valuation department has been upgraded in order to augment revenue earning throughappropriate valuation of imposed goods by developing modern valuation database. Mandatory Pre
Shipment Inspection (PSI) system has been introduces in fiscal years 2000-2001 for valuation andinspection of imported goods for a period of three years on a temporary basis. The main objectiveof PSI was to assist the customs authority to ensure quick clearance of imported goods bybringing down the percentage of physical examination to a minimum level and increase
government revenue earning by reducing misdeclaration about description, value, classificationand quantity of the imported goods.

Future Needs:
The various steps for NBR (National Board of Revenue) and the Government of Bangladesh
are:1) Plan for a well organized and structured course to formulate the reform profile of each ofits components (Customs, VAT, Income Tax and NBR);
2) Select a team of experts from NBR, private sector, external experts and the funding
agencies to develop short, mid and long term strategies covering the following areas:♦ Organizational and Administrative reform;♦ Jurisdictional and Policy reform;♦ Institutional Development (Infrastructure and Logistics);♦ Enhancement of VAT and Income tax nets and Progressive reduction of dependence on
import duties;♦ Initiate Private sector Tax education program;♦ More than 100% pre-assessment to risk management and selected post event audit
environment;♦ Develop IT infrastructure to support the changes across all wings;♦ Set up computer and communication system for electronic submission, processing andposting of tax return and bill of entry; and♦ Use of Internet and web page to bring NBR to the frontier of today’s information
technology.

Appendix –A1
Map of Bangladesh

Appendix –A2
Foreign Aid to Bangladesh at a Glance3 (1971/72-1999/2000)(US$ Million)
Commitment
Disbursement
Pipeline: 1
PurposeJuly,20004
Grant
Loan
Total
Grant
Loan
Total
1
2
3
4
5
6
7
8
Food Aid
5279098
7625576041655
5210912726557597346955100
Commodity Aid
51852205376018 10561238
51541975217848 10372045
40126
Project Aid
9195601 18221054 27416655
7115293 12883887 19999180
5657042
Total
19659919 24359629 44019548 17480402 18864292 36344694
5752268
Source: Ministry of Planning, Government of Bangladesh

3

Does not Include IMF credits and some special borrowings by Ministry of Food, Bangladesh Shipping Corporation,
Bangladesh Biman, Bangladesh Petroleum Corporation and assistance for Defence, and to NGOs and Private Sector.
4
Pipeline amount does not equal to commitment minus disbursement because of cancellation/ transfer and exchange
rate adjustments.

Appendix-A3
Commitment and Disbursement of Grants (from Japan to Bangladesh)(million)
Category /Description/user agency/
Agreement Date
Food Aid
1. G4620000309a KR Food Wheat 34,000 MT
Date 09.03.2000
Subtotal- Food Aid
Subtotal- Food Aid
Commodity Aid
2. G4619990622a 22nd Debt Relief Grant DT
22.06.1999
3. G4619991108a 22nd Debt Relief Grant DT
08.11.1999
4. G4619991228a 22nd Debt Relief Grant DT
28.12.1999
5. G4620000327a 22nd Debt Relief Grant DT
27.03.2000
6. G4620000612a 23nd Debt Relief Grant DT
12.06.2000
Subtotal- Commodity Aid
Subtotal- Commodity Aid
Project Aid
7. G4619970406a Poultry Research Mgt projectdate 06.04.97
8. G4619960111a Const. of Multipurpose Shelter
date 11.01.96
9. G4619930802a Const. of Multipurpose Cyclone
Shelter date 06.04.97
10 .G4619961125a Study for N Dhaka Sewerage
project date 25.11.96
11. G4619960904a Poultry Research Mgt projectdate 06.04.97
12. G4619970827a National Immunization day
date 04.09.96
13. G4619980505a Weather Warning Services
date 22.08.97
14. G4619970827a Reconst. of small and Med
Bridges date 05.05.1998
15. G4619980505a Eradication of Poliomyelitis
date 27.08.97
16. G4619981228a Improvement of Maternal andChild Health Institute date 05.05.98
17. G4619990824a Multipurpose Cyclone Shelter
date 24.08.1999
18. G4620000618a Proc. Of Portable Steel Bridge
date 24.08.99
19. G4620000314a Expanded Immunization Plan
date 14.03.2000
20. G4619990812a Cultural Grant to BTV
date 22.08.99
Subtotal Project Aid
Subtotal Project Aid

Pipelineon
1/7/99Cancel& Adjust

Fresh aid
Commit.

Total
Avaiable

Disbursement

Pipelineon
1/7/00

Yen 850.0

0.0

0.0

850.0

850.0

0.0

850.0

Yen 850.0
US$

0.0

0.0

850.0
7.927

850.0

0.0

850.0
7.927

Yen 12629.2

12629.2--

12629.2

12629.2-

Yen 4823.6--

4823.64823.64823.6-

Yen 4592.5--

4592.54592.54592.5-

Yen 2464.7--

2464.72464.72464.7-

Yen 6902.3--

6902.26902.26902.2-

Yen 31412.3
US$12629.2
104.3

0.0
-

18783.0
174.2731412.3
278.5831412.3
278.580.0
0.0

Allocation

Yen

679.0

679.0

0.0

0.0

679.0

0.0

679.0

Yen

566.0

3.9

0.0

0.0

3.9

3.9

0.0

Yen

495.0

295.4

0.0

0.0

295.4

262.7

32.7

Yen

143.6

143.6

0.0

0.0

143.6

143.6

0.0

Yen

446.0

96.0

0.0

0.0

96.0

96.0

0.0

Yen 1473.0

20.7

0.0

0.0

20.7

20.7

0.0

Yen 1965.0

611.3

0.0

0.0

611.3

609.0

2.3

Yen

338.0

70.0

0.0

0.0

70.0

70.0

0.0

Yen 1177.0

1059.70.0

0.0

1059.7

748.7

311.0

Yen

341.0

341.0

0.0

0.0

341.0

337.7

3.3

Yen

852.0

0.0

0.0

852.0

852.0

346.9

505.0

Yen

892.0

0.0

0.0

892.0

892.0

0.0

892.0

Yen

89.0

0.0

0.0

89.0

89.0

0.0

89.0

Yen

39.5

0.0

0.0

39.5

39.5

39.5

0.0

Yen 9496.2
US$

3320.6
27.4

0.0
0.00

1872.517.2035193.144.63

2678.724.9972514.4
19.633

Source: Ministry of Planning, Government of Bangladesh

Appendix-A4
Commitment and Disbursement of Foreign Aid in Bangladesh (from Japan)(1971/72~1999/2000) (US$ Million)
CommitmentYear1
1971/71

Food
Grant(Loan)
2

Disbursement

Commodity
Grant

Loan

3

4

Project
Grant

Total

Loan

5

2+3+4+5

6

7

Food
Grant
(Loan)
8

Commodity
Grant

Project

Loan

9

Grant

10

Total
8+9+10+11
+12
13

Loan

11

12

10.600---10.600

-

-

-

-

-

00

1.400

-

-

-

31.324---14.824-31.901--31.901----23.5391974/75

9.500

6.400

40.081--55.981

1.110

22.210--30.291

1975/76

1300

-

43333

2333

-

46999

1.924
23.539 L
3410
3.561 L7390

12.0001973/74

1.924528.000 L
-

5290

31864

-

-

44526

1976/77

6.700-

43.33311.30717.64881.9886.700-

29.729

1.765

0.900

39.094

1977/78

4.000
5.000
40.900 L
7.900
15.000 L
8.772
31.500 L
9.000
34.400 L
13.00021.68413.410 L
5.836-

75.0006.950

41.678127.628

4.000-

90.12217.4751.466

113.063

16.75071.0009.470

67.632210.752

14.50080.4128.670

20.060128.64218.20663.38218.86013.418136.766

15.00662.47514.29674.034229.61120.40277.30028.50061.362227.8366.332

57.33616.90932.973153.822

3.68

78.80

17.56

42.10

185.54

21.69

97.72

20.80

43.63

192.85

19.76

72.00

9.19

22.60

136.55

4.00

74.28

10.00

15.11

150.79

22.44

74.75

35.18

42.72

210.3818.885

45.39

19.82

4.99

114.58

17.34

65.59

27.93

69.36

186.075.000
7.900
55.900 L
8.772
31.500 L
9.000
13.00034.000 L
12.08
13.410 L
10.000

20.55

58.10

22.47

15.11

126.251972/73

1978/79
1979/80
1980/81
1981/82
1982/83
1983/84
1984/85
1985/86

16.064

42.22

-

4.58

-

62.87

6.28

16.82

59.45

22.85

34.11

139.54

1986/87

12.40830.47

105.6084.11

100.93333.53

18.35

39.39

143.8822.47

108.73332.85

1987/8817.01537.69

107.7327.16855.69

245.21

25.67

30.41

135.92

54.60

67.97

314.591988/89

14.99348.66

163.4025.28

210.79463.14

12.57

40.97

136.706.99

142.88340.14

1989/90

9.138

65.98

60.84

48.25

129.35313.56

8.06

20.11

86.34

91.17

129.63335.291990/91

19.802

78.14

55.17

12.211160.29325.62

11.44

155.75

29.17

22.04

126.69345.11

1991/92

-

88.01

94.19

59.61

-

241.82

10.81

101.77

-

19.92

20.49

153.001992/93

11.22

177.42

-

54.61

-

242.888.66

110.26

58.78

64.08

22.20

264.001993/94

11.456

66.24

-

34.60

448.51560.66

12.44

137.64

46.64

52.93

44.05

293.71

1994/95

8.664

264.211-71.68

246.10590.669.62

172.74-31.74

142.41356.53

1995/96

8.339

153.404-

8.3-

170.129.68

169.02

10.49

33.49

108.41331.11

1996/97

7.622

159.57-10.83

133.88311.91

7.91

238.25

11.42

29.03

81.57

368.191997/98

6.601

140.43

-

57.29

-

204.32

-

73.18

3.24

11.51

83.96

171.91

1998/99-152.73-

2.92-

155.666.6

116.02

2.77

37.75

71.86

235.03

1999/00

7.927
245.865
163.210 L

174.27-17.20

136.03335.43278.58

3.01

24.99

84.08

390.68688.88 2000.04

6237.91237.338
163.210 L

1820.35

1377.46657.85 1477.41

5733.64

Total

1816.472 1323.43

Source: Ministry of Planning, Government of Bangladesh

5

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