The country’s local currency, taka, foreign reserves and economic growth are at risk due to inflation and global economic slowdown.

The IMF’s warning came after its recent visit to Bangladesh, during which the organization assessed the country’s economy.

In January, Bangladesh received a $4.7 billion loan from the IMF to help address growing economic troubles. The country has already received $476 million as the first tranche, with the second tranche of the loan expected in November.

After making import payments for two months next week, Bangladesh’s foreign reserves are expected to fall to $29.86 billion, the lowest in seven years.

The decline in exports and remittances, the two major sources of foreign exchange, has not helped improve Bangladesh’s current account deficit.

Exports fell 16.5 percent to $3.95 billion in April from a year earlier as orders from clothing retailers slowed. Inward remittances, on the other hand, declined 16 per cent year-on-year to $1.68 billion in April.

While Bangladesh’s foreign exchange reserves are dwindling, neighboring India has seen its import cover hit a 10-month high. India’s foreign exchange reserves rose by $4.53 billion to $588.78 billion in the week ended April 28.

This discrepancy highlights the struggles that Bangladesh faces in comparison to its larger neighbor.

Bangladesh, once touted as a strong emerging economy, has been struggling since the pandemic hit the global economy. Bangladesh’s current account deficit reached a record $18.7 billion in the last fiscal year ending June 30, 2022, due to a depletion in foreign exchange reserves due to a drop in exports.

The government has also raised fuel and energy prices in recent months after contacting the IMF for assistance.

As per the estimates, the Bangladeshi economy is expected to contract from 7.1 per cent in 2021-22 to 5.2 per cent in 2022-23 due to the weak macroeconomic outlook.

However, according to World Bank estimates, FY24 (July 2023 to June 2024) is expected to be much better for Bangladesh.

Economic growth is expected to accelerate over the medium term to around 6.5 per cent in FY2024, as inflation eases, external economic conditions improve, and reform implementation picks up.

But structural reforms will be key to Bangladesh’s economic recovery.

The World Bank’s Bangladesh Development said, “Bangladesh needs to establish an enabling policy environment by creating a competitive business environment, diversifying exports, enhancing human capital, building efficient infrastructure, deepening the financial sector, and attracting private investment.” There is a need to generate employment and employment opportunities by doing so.”

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The working paper ‘Stacking up the Benefits Lessons from India’s Digital Journey’ states that the government played the role of a catalyst, acting as an anchor client and setting up institutions to ensure continuity in the operation of India Stack.

It said that by using this digital infrastructure, India was able to quickly provide assistance to an impressive portion of poor households during the COVID-19 pandemic.

The paper states that using a digital backbone has helped India rapidly scale up its vaccine distribution and overcome challenges such as large-scale internal migration. The technology underlying CoWIN, a digital platform developed by India to capture the COVID-19 vaccination programme, has been deployed in Indonesia, Philippines, Sri Lanka and Jamaica to help facilitate their vaccination programmes.

The paper lauded the Pradhan Mantri Jan Dhan Yojana (PMJDY) launched by the Narendra Modi government and said that the sound policies led to a competitive, open and affordable telecom market and a reduction in data usage by 90 per cent reduction in mobile data costs. The boom came

The paper states that demonetisation has led to higher usage of other forms of payments including UPI.

It added that Aadhaar facilitated transfer of social security net payments directly from government treasury accounts to bank accounts of beneficiaries, effectively reaching households to reduce leakages, prevent corruption and increase coverage. Helped to provide a tool.

“The Government of India estimates that by March 2021, about 1.1 per cent of GDP was saved in expenditure due to digital infrastructure and other governance reforms,” the paper said.

It said that by using this digital infrastructure, India was able to quickly provide assistance to an impressive portion of poor households during the pandemic.

DPI refers to a set of shared digital building blocks, such as applications, systems and platforms, that are governed by interoperable open standards or specifications. India Stack is the collective name for a group of DPIs commonly used in India; It consists of three distinct layers – unique identity (Aadhaar), complimentary payment system (Unified Payment Interface, Aadhaar Payment Bridge, Aadhaar Enabled Payment Service), and data exchange (DigiLocker and Account Aggregator).

“Together they enable online, paperless, cashless and privacy-respecting digital access to a variety of public and private services,” the paper said. The benefits of this investment were felt across the country and India during the pandemic did a good service.”

It said that in the first months of the Covid-19 pandemic, around 87 per cent poor households received at least one benefit.

“India Stack has been used as a platform to foster innovation and competition, expand markets, bridge the gap in financial inclusion, boost government revenue collection, and improve public expenditure efficiency.”

The paper states that digital payments are now ubiquitous and UPI accounts for 68 per cent by volume of all payment transactions.

“The use of digital payments has expanded the customer base of small merchants, documented their cash flows and improved access to finance. Easier access to financial services through account aggregators has helped roughly 4.5 million individuals and Companies have benefited since it was first launched in 2019. August 2021, and the adoption rate is increasing rapidly,” the paper said.

It said digitization has also supported the formalization of the economy, with around 8.8 million new taxpayers registered for the GST between July 2017 and March 2022, “contributing to the increase in government revenue in recent years”.

“Government service provision has been streamlined; for example, citizens can access state and central government issued documents through a single platform. Similarly, India Stack has digitized and simplified its customer processes, thereby reducing costs Banks using e-KYC have reduced their cost of compliance from $12 to 6 cents. The reduction in cost made the service more attractive to low-income customers and encouraged new products to be developed.

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Indian-American Gita Gopinath, the chief economist of the International Monetary Fund, is being promoted as the first deputy managing director of the IMF, the fund announced on Thursday.

She will replace Geoffrey Okamoto, who plans to leave the fund early next year. Gopinath, who was due to return to her academic position at Harvard University in January 2022, has served as the IMF’s chief economist for three years.

IMF Managing Director Kristalina Georgieva said, “Geoffrey and Geeta are both great partners, I am sad to see Geoffrey leave, but at the same time, I am glad that Geeta has decided to stay on as our FDMD and accept the new responsibility.” has done.” ,

Georgieva said Gopinath’s contributions to the fund’s work have already been exceptional, particularly “his intellectual leadership in helping the global economy and the fund navigate the twists and turns of the worst economic crisis of our lives.”

She also said that Gopinath, the first woman chief economist in the history of the IMF, has gained respect and admiration in member countries and institutions with a proven track record in working analytically rigorous on a wide range of issues.

Under Gopinath’s leadership, the IMF’s research division had gone from strength to strength, notably highlighting its contribution to multilateral monitoring through the World Economic Outlook, helping countries respond to international capital flows (Integrated Policy Framework). A new analytical approach to help, and Gopinath’s recent work on a pandemic plan to end the COVID-19 crisis by setting targets for immunization at a viable cost to the world, said IMF Managing Director Doing.

“As the pandemic continues its grip on us, the work of the Fund has never been more important, and international cooperation has never been more important. I am very grateful to Kristalina and the Board for this opportunity, and so to all, I look forward to collaborating closely with the incredibly talented and committed collaborators at the Fund, whom it has been an absolute privilege to work with,” said Gopinath.

Georgieva noted that given the increasingly complex policy choices and difficult trade-offs facing the IMF’s 190 member states, the pandemic has led to some changes in the roles and responsibilities of the fund’s senior management team.

Specifically, the FDMD will lead monitoring and related policies, oversee research and major publications, and help promote the highest quality standards for IMF publications, she said.

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The IMF in its report based on “consultations” among members, however, cautioned that the economic outlook remains “cloudy” due to uncertainties related to the pandemic, which contribute to both downside and upside risks.

A health worker collects a swab for rapid antigen testing from a farmer in his field during a door-to-door vaccination campaign amid the ongoing COVID-19 outbreak, in Banaskantha district in the western state of Gujarat. (Representative image: Reuters)

Describing the Indian government’s response to the COVID-19 situation as “rapid and adequate”, the International Monetary Fund (IMF) has said the country has continued labor reforms and privatization despite the pandemic.

The IMF in its report based on “consultations” among members, however, cautioned that the economic outlook remains “cloudy” due to uncertainties related to the pandemic, which contribute to both downside and upside risks.

In its “Article IV” advisory report, it further said that the continued negative impact of COVID-19 on investment and other growth drivers could prolong the economic recovery.

On the Indian government’s handling of the pandemic, the multilateral agency said it was “swift and substantial … It included financial support, including support to vulnerable groups, monetary policy easing, liquidity provision, and adjustments to financial sector and regulatory policies.” Huh. “.

“Despite the pandemic, authorities continue to implement structural reforms, including labor reforms and a privatization plan,” the report said.

The IMF has projected India’s economic growth to be 9.5 percent in the financial year 2021-22 and 8.5 percent in 2022-23. Headline inflation is projected at 5.6 per cent in 2021-22 amid higher price pressures.

“The economic outlook remains cloudy due to pandemic-related uncertainties, contributing to both downside and upside risks. The continued negative impact of COVID-19 on investment, human capital and other growth drivers could prolong recovery and moderate period may affect growth,” the IMF said.

It further said that while India benefits from favorable demographics, disruption in access to education and training due to the pandemic can improve human capital.

At the same time, the recovery may also be faster than expected, it said, adding that faster vaccination and better medical science can help in limiting the spread and impact of the pandemic.

In addition, successful implementation of the announced comprehensive structural reforms could enhance India’s growth potential, the IMF said.

Under Article IV of the IMF’s Agreement, the IMF holds bilateral discussions with members, usually every year.

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New Delhi: India’s new agricultural laws “have the potential to take an important step forward to improve the agricultural sector“, the International Monetary Fund has said. However, the international body stated that those who may be most affected by the change in the new system should be adequately protected.

The IMF’s weight on three new farm laws comes in a day when Union ministers and farmers are set to meet for the ninth time to find a solution to the demands of farmers, who, among other conditions, want the law to be completely withdrawn be taken.

IMA communications director Gerry Rice told reporters in Washington on Thursday, “We believe the agricultural bills have the potential to represent an important step for agricultural reforms in India.”

“The measures will help farmers contract directly with vendors, allow farmers to maintain a greater share of surplus, reduce the role of middlemen, increase efficiency and support rural development,” said Mr. Rice.

An IMF spokesman said, “However, it is important that the social safety net adequately protects those who may be adversely affected during the transition to this new system.” improvement.

Thousands of farmers, mostly from Punjab and Haryana, are camping at the state’s border points near Delhi, demanding a complete repeal of the three farm laws and a legal guarantee of the minimum support price for their crops.

The government has said that it was ready to discuss the laws by clause, but the farmers are adamant on their demand to repeal the law altogether. He has planned a tractor rally on 26 January, Republic Day, although the Center has asked the Supreme Court to stop the farmers from holding that rally, as it could tarnish the country’s image on an important day.

The Center has said that the law – passed in September last year – would allow farmers’ income to deal directly with large companies and bypass government-regulated wholesale markets. But many unions disagreed, stating that they risk losing their bargaining power and becoming unsafe for potential wholesale buyers. They fear the eventual disappearance of the MSP – the government pays guaranteed prices for their grain.

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