We have fallen into a debt trap: NBR chairman

We have already fallen into a debt trap, and unless we accept this truth, it will not be possible to move forward, said Md Abdur Rahman Khan, chairman of the National Board of Revenue.

He made the remarks on Monday, December 8, at a seminar held at the NEC conference room in Sher-e-Bangla Nagar, Dhaka. The seminar was organised by the General Economics Division of the Planning Commission marking the release and presentation of Bangladesh State of the Economy 2025 and SDGs Progress Report 2025.

NBR chairman Md Abdur Rahman Khan said that a few years ago, the tax-to-GDP ratio was above 10 per cent, but has now fallen to nearly 7 per cent. He said that one major reason for this fall was the inability to collect revenue from all sectors of GDP. He also mentioned that during the tenure of the interim government the NBR will be divided into two units, each under the leadership of a separate secretary.

The governor of Bangladesh Bank said that the integration process of five troubled banks is progressing quickly. The deposit guarantee has been increased from Tk 100,000 to Tk 200,000. He expressed hope that within one to two weeks, funds could begin being disbursed to depositors, and the new bank may start posting profits by its first or second year. Due to this initiative, deposit refunds will reach 7.6 million families, including customers of the five banks.

CPD fellow Mostafizur Rahman said that falling into a debt trap is a threat for any country, since debt repayments will require borrowing further. He said that earlier government salaries and pensions were the main expenditure under revenue budget, followed by agriculture and education. But now, interest payments on debt have moved into the top priority, pushing back key sectors such as agriculture and education.

The chief guest at the event was Anisuzzaman Chowdhury, special assistant to the chief adviser on economic affairs. Special guest at the event was Ahsan H Monsur, governor of Bangladesh Bank. Also present was Shafiqul Alam, press secretary to the chief adviser.