The government will discourage luxury expenditures and prioritize government spending that creates job
Finance Minister A H M Mustafa Kamal, in his budget speech on the parliament today, said that the government came up with a plan with four strategies to achieve full economic recovery from the damages caused by Covid-19 pandemic.
Firstly, the government will discourage luxury expenditures and prioritize government spending that creates job.
"Due to sound macro-fiscal operation by the government during the last ten years, our Debt-to-GDP ratio is still as low as 34 percent. This provides us with a cushion against any negative macroeconomic implication while we are increasing public spending to overcome the crisis," Mustafa Kamal said.
Secondly, the government is creating loan facilities through commercial banks at a subsidised interest rate for the affected industries and businesses.
This initiative is being taken so that those industries and business affected can revive their economic activities and maintain competitiveness home and abroad.
The third strategy is to expand the coverage of the government's social safety net programmes to protect the extremely poor and low paid workers of the informal sector from the sudden loss of their source of earning due to pandemic.
"Finally, we will increase the money supply to the economy while making a delicate balance between increased money supply and possible inflationary pressure," the finance minister further said.