Foreign Currency Crisis And Misuse Of Public Money

Uphill task of revenue collection Is marred with inefficient resource allocation.

Recently, platform of international air travel agencies appealed to the government of Bangladesh to release $323 million owed by the agencies. They made similar request to the government of Pakistan. Both countries are facing severe foreign currency crisis and subject of IMF budgetary assistance to fix their macroeconomy. Earlier Bangladesh Bank eased the rule of purchasing plane ticket with foreign currency, allowing local currency as a substitute. This was not the first incident many multinational companies had earlier reported that they had difficulties in repatriating their profit back home amid foreign currency crisis.

This issue is surfaced at a moment when Bangladesh Petroleum Corporation (BPC) owes Taka 30 billion as fuel bill to Biman Bangladesh Airlines,national flag carrier of Bangladesh. Petrobangla ,another public company ,on the other hand earned Taka 90 billion as interest by depositing VAT money into several bank accounts ,not giving a penny to the National Board of Revenue(NBR).The due payment is more than enough to clear travel agents' dues of $323 million.

Meanwhile, our interest payment on foreign loans has already crossed $2.57 billion for the current fiscal year. It is indeed putting huge pressure on resource allocation. Government has already requested the Russian government to postpone the scheduled repayment of Rooppur Nuclear Power Plant credit for two years. Delay in installing the transmission line ,which requires new assessment and foreign credit,is identified as the main reason.

Monitoring and Evaluation department of the ministry of planning has already shelved the proposed spending on line 5 of the Metro rail service network. It particularly questioned spending on Taka 60 billion as commitment fees and interest payment. Why don't we use the stock market to finance the metro rail project? European settlers in the United States used stock market to expand rail network across America. If people and companies are interested, they will buy stock of this rail network. This is also a measure of identifying the popular and viable routes. Per kilometer construction cost of such project reached a record level ,an unmatched example in the world. And for an electricity-run metro service, we the commuters pay a hilarious amount of fair, almost twice the fair of bus,which is lowered recently following fuel price adjustment. Using simple tiles instead of granite, staircase (and large service lift/no lift) instead of escalator and too many lifts,local materials instead of foreign materials, spartan stations instead of exotic stations, no station plaza instead of too many station plaza, local coaches instead of foreign coaches ,we could bring down the construction cost. I had the opportunity to ride on the Chennai metro,which is also viaduct-based. It is simple ,clean ,functional and cheap. This is what we want here. We have to cut our coat according to our clothes. Eye-dazzling look gives a comfort,but does not provide a relief to the inflation-battered pockets. And our companies should have greater role in these projects. Leasing out the management of metro service to third parties could bring down the operational cost and increase the revenue.

Inefficient use of resources is another worry. A public company provided 100,000 electronic voting machine (EVM) to the Election Commission with a price tag of Taka 38.25 billion. EVM machines were supposed to be operational for 10 years. But after 5-year 60% of them went out-of-service and the public company demanded Taka 80 billion to fix them. However,due to acute funding crisis the project did not see the light. Any private company could provide the EVMs at one-tenth of the cost and might save the public money. So we are witnessing acute funding crisis on one side,and inefficient use of public resources on the other. Government is unable to clear the dues of international air travel agencies,but wasting millions of tax payers' money through rickety public companies.