Staff Reporter :
At least Tk 92,261 crore was siphoned off in 24 financial scams from the banking sector of Bangladesh in last 15 yearsthrough irregularities and misuse of power and may have been laundered abroad, according to the Centre for Policy Dialogue (CPD).
The CPD, an independent think-tank, comes with the figure of fund embezzlement from the financial sector by compiling reports published in the media between 2008 and 2023.
The total loss might surge even higher if smaller irregularities – like loan write-offs, rescheduling, and court stays – were considered.
This disclosure came to light at a media briefing on Saturday as the CPD has prepared an assessment report titled “State of the Bangladesh Economy in FY2023-24 (First Reading), as part of the think tank’s Independent Review of Bangladesh’s Development (IRBD) programme.
Raising concern about the health of the banking sector amid rising defaulted loans, CPD Executive Director Fahmida Khatun said “The banking sector is in the grip of crony capitalism.
The crony capitalists have used banks as vehicles for reaching their goal of financial oligarchy.”
Excess liquidity in the country’s banking sector has declined from BDT 169,556 crore in Oct 2022 to BDT 158,432 crore in Oct 2023, according to the CPD.
While presenting the interim review of the economy, Dr Fahmida said, “The looted sum equates to a substantial portion of the government’s fiscal deficit, significantly impacting social security, education, and healthcare sectors.”
Revisiting the Bangladesh Bank’s role in safeguarding public funds, Dr Fahmida pointed out weak policy measures and asserted that beneficiaries influenced the policy-making.
“Its weaknesses have been consistently exposed through high loan default rates and sub-par performance across various indicators. This inherent fragility presents significant risks to the overall economy,” she added.
The CPD also identified labor rights violations as a persistent concern for Bangladesh. The number of workers’ unrest in Bangladesh was 431 in 2021, dropping to 196 in 2022. In 2021 and 2022, a total of 1053 and 1034 workers, respectively, lost their lives due to workplace accidents here.
Professor Mustafizur Rahman, a distinguished fellow of the CPD, said at the event that the state of the economy has now become vulnerable compared to recent years.
“In 2010, the income of the top 5 percent of the earners was 30 times more than the lowest 5 percent. But this gap has now increased to 80 times,” Mustafizur said.
“Although we fought for returning to a “one-economy concept” from the “two-economy” ones, practiced by the then-ruling Pakistan government before our independence, the country has now almost fallen back into such practices due to crone capitalism,” CPD’s Distinguished Fellow Professor Mustafizur Rahman expressed.
During the discussion, Mustafizur emphasised the importance of tax collection in ensuring fairness in distribution.
“Due to the lack of increase in revenue collection, the entire income is being spent on revenue expenditure, making development entirely dependent on loans,” he said while expressing concern that this situation could lead the economy into a trap if more loans are taken to pay off existing debts.
At the press conference, CPD Executive Director Dr Khondaker Golam Moazzem, Senior Research Fellow Towfiqul Islam Khan, and other researchers delivered their speeches.
