To check the reality of GDP growth data, its direction – whether it increased – should be looked at first. Currently, high-frequency growth-related indicators such as those of export-import, private sector credit, investment and savings are in good positions compared to the previous year. In this estimation, the GDP growth data is rational.
Now, the question is how much acceptable 7.25% growth is. Two questions arise here.
The government set a target of 7.2% GDP growth in the budget for the current fiscal year. Magically, the Bangladesh Bureau of Statistics-calculated achievement (7.25% GDP growth) is the same as the target. Such incidents also happened in the previous fiscal years, except for the last two pandemic-hit years.
If the government can achieve the GDP growth exactly what it targets, then why doesn't it achieve targets of collecting revenue, increasing development spending, receiving foreign aid and others?
The second question is which sectors does the GDP growth come from? What is the reality of sector indicators?
The three sub-sectors of the manufacturing sector achieved 12% growth. In the pre-budget talks, several trade bodies including the FBCCI, MCCI, DCCI, BKMEA, and the SME Foundation said the businesses were yet to recover from pandemic fallouts. They sought tax reduction and stimulus.
So, the pre-pandemic level growth (12%) seems irrational, and cannot be accepted. If we assume the growth is true, there should not be a need for stimulus any longer, as all of them have achieved double-digit growth.
The per capita income increases with GDP growth. We should look into how much of the increased income goes in favour of the poor class. We see the number of poor people has not reduced.
The government has introduced low-cost food purchase cards for one crore families. The programmes of the TCB also increased. Even after these, the number of people in the TCB line is not decreasing. Lower-middle income people are also coming into the queues.
RMG manufacturers say their profits are not increasing despite increased exports. Even labour wages have not surged keeping pace with the per capita income hike. Then, who gets the extra income?
Zahid Hussain talked to The Business Standard's Senior Staff Correspondent Jahidul Islam over the phone