The interim government is preparing an economic strategy paper focusing on checking growing income inequality and revenue generation in the country.
Emphasising the need for higher public spending on health, the strategy paper will highlight measures to minimise the growing out-of-pocket cost for treatment, said officials.
In 2020, people spent Tk 68.5 from their pocket for each Tk 100 expense, up from their out-of-pocket expenditure of Tk 67 five years ago.
Besides, developing better human resources by increasing investment in education is also an imperative to check inequality, added the officials.
Income inequality cannot be checked only with income-generating measures, said finance adviser Salehuddin Ahmed in a recent interview with 抖阴精品.
Referring to the overall government investment in education in China, South Korea, and Thailand at over 12 per cent of the gross domestic product, the finance adviser regretted that Bangladesh could not even afford 5 per cent of the GDP for the sector.
Despite the impressive economic growth of average 6 per cent over the two decades, Bangladesh has been facing growing income inequality.
The income inequality on Gini Co-efficient that Bangladesh Bureau of Statistics measured in 2022 stood at 0.4999, up from 0.482 in 2016 and from 0.458 in 2010, with a smaller Gini Co-efficient meaning a less unequal distribution of national wealth.
According to economists, a strategy paper to plug the loopholes in distribution against inequality is a good idea, but the proposed one should not be like the traditional ones studded only with suggestions.
They also said that the high economic growth over the years was not distributed equally as the rich section of society enjoyed privileges to聽 obtain facilities like education, health, and access to finance.
The inequality of opportunity has become acute, said Institute for Inclusive Finance and Development executive director Dr Mustafa K Mujeri.
The fiannce adviser said that the proposed strategy paper intended to deal with the crucial aspect of public spending on health and education should be followed through by the new elected government.
The interim government has already announced that the general election would be held in February to conclude its tenure that began on August 8, three days after the ouster of the Awami League regime amid the July mass uprising the past year.
Former World Bank Dhaka office chief economist Zahid Hussain said that the strategy paper should clearly specify the measures that would be meant to overcome the problems.
Superficial ideas on the issue will not come to any help, said the economist referring to the protests faced by the interim government in splitting the National Board of Revenue into two new divisions without necessary groundwork.
Besides, the revenue generation that is essential to increase the country鈥檚 tax-GDP ratio and support the higher expenditure on social welfare, the strategy paper will also focus on public debt management, said officials.
The interim government has already given signals to all ministries and divisions to be cautious about new foreign loans at a seminar held on August 13 at the secretariat.
The seminar was arranged after the International Monetary Fund said that Bangladesh鈥檚 overall debt distress risk increased to moderate level from its previous low level while the Finance Division said that the rapid pace of debt accumulation and the existing macroeconomic challenges were raising red flags on loan repayment.聽
The interest payment on foreign loans reached more than fivefold to Tk 22,000 crore in the financial year of 2025-25 in a span of five years from only Tk 4,318 crore in FY 19-20.
During the same period, the interest payment on domestic loans almost doubled to Tk 99,500 crore from Tk 53,995 crore.
The high growth in the interest payment on foreign loans has been attributed to the excessive borrowing that surged to $73.34 billion at the end of FY24-25 from 20.85 billion in 2008-09.
