BPC's New System

New system inside BPC May make NBR's task easy.

Bangladesh Petroleum Corporation (BPC) intends to launch a smart fuel distribution system. Successful implementation of this system means timely distribution of fuel and greater transparency in fuel transaction. Being the largest corporation of Bangladesh, BPC activities mean a lot to the govt. (For more read "Smart Fuel Distribution Chalu Korte Chai BPC(BPC Wants To Start Smart Fuel Distribution)", Sanchita Shitu,Bangla Tribune,May 23,2024.Link:https://tinyurl.com/shjbnct4)

Since 2015,BPC made huge profits and it continued till 2021.In this period, govt provided zero subsidy to BPC.Prior to 2015,huge subsidy was given to BPC. In 2013,govt gave a subsidy of Taka 13.557 billion to BPC. This unravels the subsidy pressure on govt. Luckily, monthly fuel price adjustment eases the pressure a lot. But is it enough to rescue the BPC?

BPC automation software has long been a topic of debate. Few years ago, a report divulged that BPC developed a software but faced overwhelming odds implementing the software as certain quarter delayed its implementation(For more read "BPC's 'Payment Automation' Launch Hits Snag" by Financial Express,June 24,2019.Link:https://thefinancialexpress.com.bd/trade/bpcs-payment-automation-launch-hits-snag-1561348071). Prior to the development of software, it took as long as 10 months to record a BPC transaction. That means BPC's legitimate transaction went out of official record from 10 months, ample time to make some fortune out of BPC money. Could anyone believe in a public corporation this kind of mockery was going on years after years?

BPC's transaction revenue is also a great deal of concern for the NBR. It gets huge amount of revenue from BPC's fuel sale. Real time transaction data means real time data on VAT. Lack of real time data allows other to keep NBR in the dark. Another news report divulged that Petrobangla earned huge interest by keeping money into several bank accounts while it owes Taka 220 billion to NBR. I touched the issues in my January piece titled "Economic Reforms: Morning Shows The Day"(for more read https://hoquestake.blogspot.com/2024/01/economic-reforms-morning-shows-day.html?m=1). Both BPC and Petrobangla are large sources of VAT for NBR. Dedicated offices in these two corporations and real time data on VAT could provide relief to NBR in this time of meeting the revenue target.

Not only the BPC money but sometimes subsidized oil also goes off the radar. Two years ago a deadly fire accident in an internal container depot in Chattogram revealed that oil smuggled out of the country in disguise of other goods inside containers. BPC 's smart fuel distribution system hopefully curb the incidence of such practice. It is not clear whether the smart fuel distribution system is the same software automation or a completely new system. If it is the same thing then why does it take so long to implement it? If it is a new system then it will add another layer of security to the existing software automation of BPC and ensure that subsidized oil will not fall into wrong hands.

La Semaine Dernière A Mes Yeux

(26 mai--- 01 juin)

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Ma Semaine Gastronomique

Date	Petit déjeuner	Déjeuner	Dîner	Snacks,Sucreries,Boissons et Fritures
25	Riz,Omelette, Soupe aux lentilles	Riz,Purée de banane verte et pomme de terre,Soupe aux lentilles	Riz,Purée de banane verte et pomme de terre,Soupe aux lentilles	---
26	Pain,Omelette	Riz,Pomme de terre bhaji,Soupe aux lentilles	Riz,Pianju(depuis restaurant),Pomme de terre bhaji,Soupe aux lentilles	Riz gonflé
27	Pain,Omelette	Riz,Pomme de terrw bhaji,Soupe aux lentilles	Riz,Soupe aux lentilles,Pomme de terre,Pianju(depuis restaurant)	---
28	Riz gonflé,Soupe aux lentilles avec pomme de terre	Riz,Purée de banane verte,Soupe aux lentilles	Riz,Purée de banane verte,Soupe aux lentilles,Pianju (depuis restaurant)	Cacahuètes
29	Pain,Omelette	Riz,Lait,Banane(depuis marché)	Riz,Pianju(depuis restaurant), Soupe aux lentilles	Riz gonflé
30	Pain,Pomme de terre bhaji,Banane(depuis marché)	Riz,Soupe aux lentilles,Omelette	Riz,Banane(depuis marché)	---
31	Pain,Pomme de terre,Banane(depuis marché)	Riz,Épinard d'eau	Riz,Épinard d'eau,Pangash	Riz gonflé

Mixed Reactions To Reform Programs

Blaming reforms for economic woe Leaves people confused without any clue.

As some reform programs are about to see the light, mixed reactions are being observed in the economy. Indices fell below 5000 points and daily transaction reached below Taka 4 billion at Dhaka Stock Exchange. Imposition of 15% gain tax is identified as the main reason. NBR is likely to put a 15% tax on over Taka 4 million capital gain in the stock market in a bid to meet the revenue target. The decision is indeed a good move as it will have less impact on ordinary people.In general,revenue will rise for the following reasons:

• Depreciation of Taka increases the taka amount of revenue.
• 15% tax on remittances and 15% gain tax on stock trading gain will have an impact on overall revenue generation.
• Bangladesh Petroleum Corporation (BPC) is installing a system to get real time data on transaction and payment. It will help getting VAT money from BPC in the quickest possible time. BPC VAT is one of the large sources of VAT revenue.(for more read "Smart Fuel Distribution Chalu Korte Chai BPC(BPC Wants To Start Smart Fuel Distribution)", Sanchita Shitu,Bangla Tribune,May 23,2024.Link:https://tinyurl.com/shjbnct4)
• Restructuring of existing tax slabs above the minimum taxable income (proposed to be fixed at Taka 500,000) will likely to boost revenue. Because subsequent slabs will likely to see higher taxes.
• Good harvest of winter paddy, low price of crude oil in international market and crawling peg exchange rate will put less pressure on resource allocation. Redirected resources to private sector will increase import and import duty,which registered an 11% growth till February this year.

While UAE imposed tax on outgoing remittances, a great deal of unease is seen here on the issue of remittance tax. Back in March this year,I penned a piece titled "Will Tax On Remittances Lower The Inward Flow?"(see the link: https://hoquestake.blogspot.com/2024/03/will-tax-on-remittances-lower-inward.html?m=1)highlighting why such move will increase revenue. Universal applicability of the tax rather than targeting a sector will bring its success. Import duty,VAT are the examples. Imposition of such taxes does not shrink the volume of tradable goods in the economy, nor does it have any adverse impact on the economy. A quick look at the data on import duty and VAT over two decades will clear the point I like to make.

There is a lot of misinformation about the IMF programs on the public domain. All the blames of current economic situation are heaped on IMF program. And it is being presented as anti-people. But it is the IMF that first raised the issue about non-monetary use of $7 billion forex reserve money through a letter. The letter luckily got leaked in the press and everybody became aware of the true reserve situation, avoiding further unreasonable use of forex reserve. It is the IMF team that raised question about investment of pension fund into savings certificates that offer interest rate lower than the inflation rate. It is the IMF that prescribed to raise the ceiling of minimum taxable income to Taka 500,000. Monthly fuel price adjustment resulted in reduction in bus fare. [It is the IMF that objected inclusion of national savings certificates' (NSD) interest security spending( for more see the link:https://www.prothomalo.com/business/economics/vu79oq3bdn ).*]This clearly indicates reform programs are benefitting the people a lot and plugging the holes that keep nourishing a certain quarter at the expense of public money.

[*Update: This piece has been updated by me on June 01,2024 at 20:25 Bangladesh Standard Time (BST). Update includes IMF's objection on inclusion of NSD interest into social security spending.]

La Semaine Dernière A Mes Yeux

(18 mai--- 25 mai)

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Ma Semaine Gastronomique

Date	Petit déjeuner	Déjeuner	Dîner	Snacks,Sucreries,Boissons et Fritures
18	Pain,Omelette	Riz,Ruhi,Epinard malabar	Riz,Ruhi,Epinard malabar	Toast biscuit
19	Khitchuri,Omelette	Riz,Ruhi,Soupe aux vigna mungo	Riz,Ruhi	---
20	Pain,Omelette	Riz,Poulet,feuilles de tige amarante	Riz,Poulet	---
21	Pain,Omelette	Riz,Petit poisson	Riz,Soupe aux lentilles	---
22	Pain,Lentilles avec pomme de terre	Riz,Petit poisson avec pomme de terre	Riz,Pianju,Soupe aux lentilles	---
23	Pain,Pomme de terre bhaji	Riz,Épinard d'eau,Soupe aux lentilles,Ruhi	Riz,Épinard d'eau,Soupe aux lentilles,Ruhi	Riz gonflé
24	Pain,Omelette	Riz,Pomme de terre	Riz,Pomme de terre,Soupe aux lentilles,Lait	---

More Policy Changes Are Coming

Some are concerned about the policy of gradualism, Adjustment must go on in the face of criticism.

Recently, a group of businessmen and representatives of bankers met with Bangladesh Bank governor to raise their concerns over ensuing issues after the policy rate hike and depreciation of Taka. They are worried because frequent policy rate hike and depreciation of taka raise their costs. Some news reports even claimed that governor assured them that policy rate would not cross 14%. It is true that interest rate hike and depreciation to some extent raise the cost. However, taka 7 depreciation also opens the door for making gains. Last one year, selling dollars was one of the means for banks to make profits. In that light, this and future depreciation make rooms for the businesses to make profits and covering the costs originated from the high interest rate. Those borrowed money from foreign commercial institutions will suffer. But as many houses preferred to retain their dollar earnings abroad ,which is the rational and smart thing right now given the domestic situations, they likely to gain more in the long run in the face of further depreciation. Keeping money abroad is not a matter of ethics or morality,but is a matter of survivability/staying fit for the business group. At home, the group has to procure dollar at higher rates plus the availability of the foreign currency is not guaranteed in times of need. In addition, interest rate below inflation rate,political uncertainty and subsidized exchange rate will weaken the financial position of the company. And in the long run govt may have to bail it out by providing public money. Keeping money abroad means its wealth stays secure as its dollar investment is earning interest/profit in dollars and it will gain later from depreciation of domestic currency. Plus it can ink long term debt deal, reducing risk on interest rate. It also has access to relatively cheap credit. It stays strong as a business group if it perks its wealth abroad. Those operate their business abroad using same business identity should not be subject to harassment. There is no worry as they will repatriate the money at a convenient time. But those channelled out the fund through shell companies or tax havens may have dubious intentions.

To get rid of foreign currency crisis, we need further policy adjustment. Pakistani rupee is depreciated 89% in the span of 5 years. Vietnamese dong is depreciated 10% in the same period. While Bangladeshi taka is depreciated only 40% in the last two years.Prior to 2022,policy rate was 6% in Pakistan. And now it has become 22.5%. But price levels are coming down and rupee is appreciating. In Vietnam, policy rate was 6.3% prior to 2019. Now it is 4.5%. One of the good thing about dong is it appreciated when interest rate was high and depreciated when interest rate was low. Currency responded to the market accordingly. In Bangladesh, policy rate was 6% prior to 2020. From 2021 to 2023 ,it was kept at 4.5%. And now it becomes 8.5%,which is likely to rise further. Both Vietnam and Pakistan are strong competitors of Bangladesh in the RMG sector. Pakistan and Vietnam's garments export to the US market grew in recent months. Meanwhile, Bangladesh's export saw a negative growth in the US in the last three months of 2023. That means we need more depreciation of taka to make our apparel items competitive in the US market.

Policy rate hike is a must to give investors a signal that policy rate is aligned with the inflation rate. Back in October last year,in a piece titled "Slow Alignment Costs Investment"(for more read https://hoquestake.blogspot.com/2023/10/slow-alignment-costs-investment.html?m=1 ),I highlighted how slow policy adjustment has a negative effect on Internal Rate of Return based investment decision and political impasse affects payback period of the investment. In another piece titled "Could Bangladesh Get The Second IMF Credit Pack?" in September last year(for more read https://hoquestake.blogspot.com/2023/09/could-bangladesh-get-second-credit-pack.html?m=0),I argued how slow policy adjustment holds back investment.When interest rate is sufficiently high,above the inflation rate, investors anticipate that future interest rate may be lower with the ease of inflation. So they embark upon taking investment project.

Continuing the policy rate hike is a must in the wake of Fed's decision to raise the interest rate further. While inflation is coming down, Fed's decision is to make dollar stronger than other currencies. Central banks,corporations hold US treasury bonds. In case of heightened geopolitical tension,many govts and corporations owned by rich individuals may ditch these bonds ,reading political stand taken by their governments. Higher policy rates will keep the treasury bond price low and will inflict heavy loss to the owner of the bonds if he intends to sell it. Many Chinese companies hold huge amounts of treasury bonds and they cannot sell their US bonds so easily if hostility between the two countries takes a virulent form. This situation is very likely to emerge after the US election. For a foreseeable future, Fed's rate will rise even if inflation eases in the USA. And to make taka stronger and avoid further capital flight we have to keep raising the policy rate.

I think the central bank should stay on its current trajectory. And giving any kind of assurance is like giving a wrong signal to the market because we still do not know with certainty what economic reality will be three months down the line.

সাবটাইপিং

Subtyping: এখানে এমন একটি function কাজ করে যা argument হিসেবে নেয় কেবল একটি নির্দিষ্ট type ও তার subtype কে। Object oriented programming এ এটি subclassing (inheritance) এর মাধ্যমে হয়ে থাকে।
উদাহরণে Nationality abstract class এবং তার subclass UK,Bangladesh, China এর সাহায্যে আমরা Demo class এর showNat() মেথডের মাধ্যমে নাগরিকত্ব দেখাতে চাচ্ছি। এজন্য এখানে Nationality'র object কে argument হিসেবে pass করা হচ্ছে। তারপর প্রযোজ্য subclass এর des() কে call করা হচ্ছে। C++ এ pointer arithmetic এর মাধ্যমে এটি করা হচ্ছে। এখানে Nationality base/abstract class এর des() কে virtual function () ঘোষণা করা হয়েছে যেন ভিন্ন ভিন্ন subclass এর object এর des() ভিন্ন ভিন্ন বার্তা/কাজ দেখাতে পারে। এখানে একই function des() কে call করলে বিভিন্ন subclass এর object অনুযায়ি এটি আলাদা আলাদা আচরণ করছে। এখানে n হলো একটি Nationality pointer object। এবং n নির্দেশ(point) করছে কোন একটি subclass এর object এর addressকে। কাজেই সরাসরি subclass এর object এর মাধ্যমে des() কে call না করে Pointer এর মাধ্যমে এটি করা হচ্ছে।

উদাহরণ(C++):
#include ‹iostream›
#include ‹string›
class Nationality{
public:
Nationality (){}
virtual std::string des()=0;
};
class UK:public Nationality{
public:
UK(){}
std::string des(){
return "British\n";
}
};
class Bangladesh:public Nationality{
public:
std::string des(){
return "Bangladeshi\n";
}
};
class China:public Nationality{
public:
China(){}
std::string des(){
return "Chinese \n";}
};
class Demo {
public:
Demo(){}
void showNat(Nationality *n){
std::cout«n->des();
}
};
int main()
{
China c;
Demo a;
Nationality * n=&c;
a.showNat(n);
Bangladesh b;
n=&b;
a.showNat(n);
return 0;
}

JavaScript যেহেতু type safe language তাই আমাদের এখানে compile time এ Demo class এ একটি Nationality object তৈরি করা হয়েছে,আর তারপর তাকে assign করা হচ্ছে showNat() এর argument কে । এরপর runtime এ যে object ই pass করা হচ্ছে তার des() এর বার্তা আমরা screen এ দেখতে পাচ্ছি। কারণ সব object ই Nationality class এর subclass।

উদাহরণ(JavaScript):
class Nationality{
constructor(){}
des(){}
}
class Bangladesh extends Nationality {
constructor(){super();}
des(){
return " Bangladeshi \n";
}
}
class Uk extends Nationality {
constructor(){super();}
des(){
return " British \n";
}
}
class China extends Nationality {
constructor(){super();}
des(){
return "Chinese\n";
}
}
class Demo{
constructor (){
this.s=new Nationality();
}
showNat(n){
this.s=n;
document.write(this.s.des());
}
}
var a=new Demo();
a.showNat(new China());
a.showNat(new Bangladesh());

কৃতজ্ঞতাঃ এই লেখা তৈরি করতে দরকারি তথ্য নেয়া হয়েছে Wikipedia, internet ও আমার তৈরি করা নানা program থেকে।
মন্তব্য ও যোগাযোগঃ mrh4478@gmail.com

প্যারামেট্রিক পলিমরফিজম

Parametric Polymorphism: এখানে function কে এমন abstract ভাবে লেখা হয় যেন function টি বিভিন্ন value কে argument হিসেবে নিতে পারে তাদের data type এর উপর নির্ভর না করে। উদাহরণে C++ এ template এর মাধ্যমে add() function টিতে যেকোন data type কে argument হিসেবে নেবার সুযোগ করে দেয়া হয়েছে। add() প্রথমে দু'টি integer কে argument হিসেবে নিয়েছে, পরে দু'টি string কে এবং শেষে একটি string ও একটি integer কে argument হিসেবে নিয়েছে।

উদাহরণ(C++):
#include ‹iostream›
#include ‹string›
class Demo{
public:
Demo(){}
template ‹class T›
T add(T a,T c){
return a+c;
}
};
int main()
{
Demo m;
int w=5,y=7;
//add(int,int)
std::cout «m.add(5,7);
std::string s="Hello, ",z="there!";
//add(string,string)
std::cout«"\n"«m.add(s,z);
//add(string, int)
std::cout«"\n"«m.add("May",13);
return 0;
}

JavaScript উদাহরণটিতে add() এ কোন template বা data type ব্যবহার করা হয়নি কারণ JavaScript একটি type safe language অর্থাৎ compile time এ এটি data type check না করে একেবারে run time এ check করছে। যার কারণে run time এ যাই add() এ pass করা হচ্ছে তাই সে screen এ দেখাচ্ছে।

উদাহরণ(JavaScript):
class Demo{
constructor(){}
add(a,c){
return a+c;
}
}
var m=new Demo();
document.write(m.add(5,7));
document.write(m.add("hi","there!"));
document.write(m.add("May", 13));

কৃতজ্ঞতাঃ এই লেখা তৈরি করতে দরকারি তথ্য নেয়া হয়েছে Wikipedia, internet ও আমার তৈরি করা নানা program থেকে।
মন্তব্য ও যোগাযোগঃ mrh4478@gmail.com