From where will the growth come?

Where the GDP growth will come from is more important than what the government's target is and what projection any agency is making.

Six months of the financial year have passed. Where has the growth been during this period?

Growth in export earnings is negative.

Even though there is no direct index, investment is calculated based on import of capital machineries and long-term industrial credits.

There is no growth in industrial credits. Overall credit growth has also slowed down. Both opening and settlement of letters of credit (LCs) for capital machineries are in a negative trend.

It is easy to say there is no growth in the two sectors of growth – exports and investment.

The situation of implementation of the annual development programme (ADP) through government expenditure is in a sorry state compared to the last few years.

Growth in VAT collection – a major indicator of consumer spending – is very low. People are going out and shopping. However, a large portion of this is due to not being able to shop in March-April.

How could people do shopping?

More than half of the country's people are poor. They may have returned to work, but are yet to return to the pre-pandemic status in terms of income.

Rickshaw-pullers, tea shop owners or saloon workers are in work but their income is less than before. When the income is less and earnings are low in the first six months, where will growth come from?

It remains to be seen what kind of growth is likely in the next six months.

It would not be right to expect good growth in external trade in the next six months. Our traders have also started saying this.

Europe and America – the main markets for Bangladeshi readymade garments – are shutting down. Lockdowns are going on in several countries. Even if the vaccination starts, its effect will not be visible within the next six months.

There is no immediate possibility of rapid growth of domestic investment.

Expatriate income is now the only positive indicator of an increase in consumer demand in the private sector. However, in recent times, the main reason for the surprising rise in remittance earnings is the change of channel.

Earlier, remittances came through illegal channels so there was no account of those. Maybe, the amount of remittance inflow was the same as it is now. And in this case, it will not actually play a role in boosting consumer demand.

The only positive aspect of our production is agriculture. However, due to flooding, productions of Aman and Aus were severely damaged. How much of this loss can be offset by Boro rice production remains a question.

If the Boro output is well, the agriculture sector might post a 1.5-2%. growth

As such, the World Bank has said there will be some growth. But we do not see any signs of growth in the first six months of the current fiscal.

It is a global pandemic. And I am not saying that the country's economy has collapsed due to the pandemic. We may get out of the crisis only if we can tackle the coronavirus. But in tackling the pandemic we had the idea that we were moving towards a vaccine with a well-planned-out approach. Now it seems that we have only one foot in the plan.

This uncertainty in dealing with the coronavirus is increasing the monitoring and waiting time of businesses. As a result, it will take more time for investment to come. It remains to be seen what will happen in the 2021-22 financial year.

In the second half of this year, the world economy will turn around well. If we can take advantage of this by improving the health situation, it does not seem to be very difficult to achieve our growth of more than seven percent next year.

If the world economy recovers, export earnings would increase. Investment also would increase as there was some progress in preparation. However, investment will not increase without confidence.

Dr Zahid Hussain is the former lead economist World Bank, Dhaka Office

Zahid Hussain spoke to Jahidul Islam over the phone.