Thinking Aloud: Volume X, Issue 2: July 1, 2023

The theme of the July 2023 issue of Thinking Aloud is “National Budget FY 2023-24”. The first-page article, “Current economic challenges and the national budget 2023-24”, dives into the shortcomings of the national budget for FY 2023-24, in the context of the current economic challenges. Discussing how the budget should have tackled inflation and macroeconomic management challenges, the article argues that the Russia-Ukraine Crisis can no longer be cited as an excuse for inflation. The article also points out the incongruencies between the ambitious targets set in the budget and the ground reality. The second-page article titled, “Equity and Efficiency Considerations Ignored in FY 2023-24 Social Protection Budget”, discusses the FY 2023-24 Social Protection Budget in the context of the National Social Security Strategy (NSSS) that Bangladesh adopted in 2015. Analyzing the trend in net allocation for social protection in recent years, the article observes that there has been a declining trend which is a cause of concern. It also points out that the social protection system is not taking into account the rising poverty and vulnerability in urban areas due to rural-urban migration. Shedding light on the high exclusion and inclusion errors in the social protection system of the country, the article notes that both equity and efficiency aspects have been ignored in the social protection budget of FY 2023-24. The third-page article titled, “How Far the Budget 2023-24 Addressed the Twin Challenges of Inflation and Unemployment?” analyses the shortcomings of and challenges to the fiscal policy in the context of the ongoing macroeconomic complexities. The article argues that the budget should have placed greater emphasis on fiscal measures like cutting down regulatory duties, import duties, and VAT by a significant margin, coupled with other direct measures like strict market monitoring and penalty measures for those artificially influencing the market prices. The article points out that the budget does not outline any concrete road map or action plan for generating employment. It also notes that the continuation of the current fiscal’s budgetary initiatives for boosting private sector investment is not sufficient. The fourth page of the issue covers the events in June 2023.