Finance minister AHM Mustafa Kamal on Thursday said that the government would focus on sustaining the economic recovery by successfully implementing the ongoing stimulus packages.

‘We have completely overcome the effects of the pandemic. Therefore, in this budget, our aim will be to sustain the economic recovery by successfully implementing the ongoing stimulus packages,’ he said.

The minister said this while placing over Tk 7.61 lakh crore national budget for FY23-24 at the Jatiya Sangsad.

In his speech, Kamal said that the Covid-19 pandemic had disrupted the socio-economic conditions, including the lives and livelihoods of the communities globally.

‘Our GDP growth also slowed down to 3.45 per cent in FY2019-20 due to the impact of Covid. However, during this period, growth was in the negative territory in most of other countries. Our government dealt with the Covid situation with spectacular success,’ he added.

At that time, he said, the government gave much more importance to the protection of people’s lives and livelihoods and maintaining macroeconomic stability than growth.

‘Bangladesh returned to the path of high growth in the post-Covid year because of the prudent and well-coordinated implementation of fiscal and monetary policies and inherent resilience of the economy. It’s true that our economic recovery was fast, but the global impact of Covid-19 lingered. Added to this is the Russia-Ukraine war in February 2022 which added a new dimension in global geopolitics. Consequently, the momentum of global growth slowed further. The lagged effect of these developments disrupted our recovery process as well,’ he mentioned.

He said that the Russia-Ukraine war situation had had the biggest impact on inflation, government spending, balance of payments, foreign exchange reserves and exchange rates.

‘The international supply chain was disrupted by the war and war-centric sanctions. At that time, the price of food products, fertilisers and fuel increased a lot in the world market. Developed countries, especially the United States, gradually raised policy interest rates in an attempt to control unprecedented inflation. These changes in the global environment are also affecting our economy. It is noteworthy that inflation in Bangladesh was limited to 5-6 per cent in the pre-war decade,’ he added.

However, he mentioned, the increase in import costs due to post-war global inflation and the depreciation of the country’s foreign exchange rate led to a surge of average inflation to 9.5 per cent in August 2022.

As a result, he said, it will not be possible to keep the annual average inflation within 5.6 per cent as per the target in the current financial year.

Kamal said the government’s success in dealing with the economic crisis and subsequent speedy recovery along with the protection of people’s health in the Covid-19 situation has been globally appreciated.

In order to deal with the economic crisis caused by the pandemic, he said, the government adopted various strategies such as — increasing public expenditure for job creation, providing low-interest loan facilities to industrial and business enterprises through the banking system, expanding the scope of social protection programmes and ensuring optimum money supply while containing inflation at the desired level.

‘We had adopted 28 stimulus packages worth Tk 2,37,679 crore which was instrumental for a quick economic recovery and helped stabilise the macroeconomic variables through emergency health services, food security as well as by generating employment and reducing economic losses due to Covid,’ he added.

He mentioned that the implementation of these incentive packages has directly or indirectly benefited the people of the country.

‘Approximately, 7,65,35,000 individuals and 2,40,000 organisations have directly benefitted from these incentive programmes so far,’ he informed.