Farhad Chowdhury: Due to non-availability of loans from the central bank in the current financial year, the tendency of the government to take loans from commercial banks has increased. In the first five months (July 1 to November 29), the government has taken a loan of Tk 31,274 crores. At the same time, the government did not take any loan from the central bank. On the contrary, Tk 27,635 crores of previous loans have been repaid.
In these five months, the government’s net debt from the banking system stands at about Tk 3,639 crores.
Those concerned said that the central bank has completely stopped giving loans to the government by overprinting money for the last three months to control inflation. The government’s debt has now become dependent on the central bank. However, due to liquidity crisis, commercial banks are not interested in giving long-term loans to the government. As a result, the government is forced to take loans by auctioning short-term treasury bills.
It is known that the target of borrowing from the banking system in the current financial year is Tk 1 lakh 32 thousand 395 crores. Of this, long-term loans of Tk 86,580 crore will be taken. And short-term loan will be taken Tk 45,815 crores. According to the report of Bangladesh Bank, at the end of November 29, the total status of the government’s bank loans stood at Tk 3 lakh 97 thousand 417 crores. At the end of June 30, which was Tk 3 lakh 93 thousand 774 crores.
According to this, in the first 4 months and 29 days of the financial year, the amount of net bank debt of the government stood at Tk 3,639 crores. However, from July 1 to October 26, the government’s borrowing from the banking system was in the negative.
According to the report, the loan status taken from commercial banks at this time stood at Tk 2 lakh 67 thousand 412 crores, which was Tk 2 lakh 36 thousand 138 crores at the end of last June 30. As a result, government debt from commercial banks has increased by Tk 31,274 crores. On the other hand, the status of bank loans taken from Bangladesh Bank at this time stands at Tk 1 lakh 30 thousand 4 crores, which was Tk 1 lakh 57 thousand 640 crores at the end of last June 30. As a result, the government’s debt from Bangladesh Bank has decreased by Tk 27,635 crore. This loan was fully repaid with a loan from a commercial bank.
According to the data of Bangladesh Bank, even at the beginning of the current financial year, the government has given a loan by overprinting money, but in September and October, the government has not given any loan by overprinting money. That is, although there was development of treasury bills and bonds in July and August, no development was done in September, October and November. On the contrary, during this period, the debt of Tk 32,148 crores has been paid on maturity of treasury bills. The status of net development is also decreasing. As of last November 29, the status of net development has decreased by about Tk 22,399 crores. But till the same period of the last financial year, the status of net development increased by Tk 22,413 crores.
Last financial year also, the government took a record loan of Tk 122,980 crore from the banking system. Out of this, the central bank directly provides Tk 97,684 crores, which is printed in new taka.
Executive Director and Spokesperson of Bangladesh Bank Mejbaul Haque said that the government’s debt was towards the central bank in the last financial year. A lot of new money has been created, which has taken a bit of a hit on inflation. We have already closed it. He said, creating hard power money will increase inflation. For this reason, no loan was given to the government by development in the last auction. This process has also been communicated to the government. Government has to borrow from commercial banks. Banks will give as much as they can.
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