Debapriya for better coordination between monetary policy, fiscal policy

Dr Debapriya Bhattacharya, distinguished fellow of the civil society think tank Centre for Policy Dialogue (CPD), on Tuesday suggested addressing the “managerial weaknesses” in coordinating the monetary policy and the fiscal policy and bringing more flexibility in the exchange rates and interest rates.

He made the suggestion while delivering a memorial lecture organized by the Economic Reporters’ Forum (ERF) at its auditorium in the capital’s Paltan area. The title of the memorial lecture on late journalist and Financial Express Editor Moazzem Hossain was “Macroeconomic Challenges and the ways forward”.

Debapriya said it is now being heard that the local industrialists are buying industrial raw materials from abroad with the remittances, reports BSS.

“Thus, providing 2 or 3 percent incentives will not increase the inward remittance flow. We shall be more flexible in this regard while flexibility should also be brought into the interest rates. There are managerial weaknesses in coordinating monetary policy and the fiscal policy, which must be addressed in the interest of the economy,” added the eminent economist.

Citing some of the lacking and shortcomings in the country’s economy, the CPD distinguished fellow said the revenue collection alongside investments in health, education and social sectors could not be raised in proportion to the size and growth of GDP.

He said the public investment is propelling the GDP growth, but the private investment is not increasing. “Our second deficit is in revenue collection. Even if GDP increases, the revenue collection will not increase proportionally.”

Presided over by ERF President Refayet Ullah Mirdha, the meeting was moderated by ERF general Secretary Abul Kashem. Shamsul Haque Zahid, editor of English Daily the Financial Express, was present as the special guest.