You are here
Home > Cover Story > MY COMMENTS ON THE BUDGET 2017-18

MY COMMENTS ON THE BUDGET 2017-18

Anis A. Khan
Managing Director & CEO
Mutual Trust Bank Limited (MTB)


1) The budget is ambitious, especially the GDP growth rate of 7.4%. However, Bangladesh is taking great strides to become a middle income country and ambition is good.

2 The interest rate on National Savings Certificates should be decreased to arrest the distortions in the interest rate regime in the country.

3) Given the continuing surplus liquidity system in the country’s banking system, the government should borrow from banks for its budgetary needs. Borrowings from the high cost NSCs should decrease, which will save costs for the government, and which can then be used for widening the social safety net programs.

4) Additional levy on bank deposits will erode the real savings of the country’s citizens. We feel this is a discouraging tool to increase the Government’s revenue and will dampen the people’s savings habit. We have not heard of such taxes on levies on deposits in any other countries of the world. We request its withdrawal.

5) VAT of 15% is very high on top of all other duties and taxes and will increase inflation.

6) Mergers and acquisitions of banks and financial institutions must be encouraged in a structured manner to bring in efficiencies of scale and strengthening of their capital base.

7) We welcome the tax exemption on ‘Alternative investment fund’, which wil encourage venture capital companies and funds to flourish.

8) Institutional steps are required to bring in world class corporate governance standards in the country’s banking sectors.

9) As Non-Performing Loans are on the rise, it is high time for the Government to think of setting up an Asset Reconstruction Company to take care of the infected risk assets (loans and advances). This will improve the health of the balance-sheets of banks and allow them to devote more resources on developmental activities.

10) A Credit Bureau should be set up for individuals. This is important now that the country is getting more prosperous and people need access to more loans for purchasing homes, vehicles and household goods.

Leave a Reply

Top