The Centre for Policy Dialogue (CPD) on Sunday expressed reservations about the government's provisional estimate of real GDP growth rate for the fiscal year (FY) 2019-20, arguing it does not provide a reliable assessment of the health of the economy.
The government is 'obsessed' with the GDP growth rate and it has now become more of a "political number" that is used to showcase the development in the country, it noted.
The government on August 10 released GDP growth rate at 5.24 per cent for fiscal year 2019-2020 while the CPD's projection was 2.5 per cent.
At a virtual meeting, the research firm, however, reiterated its call for the formation of an independent statistical commission for ensuring data integrity.
CPD's executive director Dr. Fahmida Khatun was moderator at the programme where distinguished fellow Dr. Mustafizur Rahman, and director (research) Dr. Khandker Golam Moazzem were present.
Senior research fellow Towfiqul Islam Khan presented the keynote paper.
Dr Khatun said there is a methodological error while measuring the gross domestic product as it always takes into account the data of the first 8-9 months of a fiscal year.
She said lacking 'real time data' is a major weakness of the measurement as the Bangladesh Bureau of Statistics (BBS) uses a number of old surveys to get the growth data for GDP calculation.
She also said the impact of pandemic, which has wrecked the global economy, is not reflected on Bangladesh's economy.
"Corona is an unprecedented event, but its impact was not taken into account as the data up to March were used for the GDP estimate," she said.
"Growth rate is now an illusion and it is now being used politically," she said.
Dr Khatun said the growth rate is not merely a figure or statistics, it has profound implications on the economy. She said it does influence policies and fiscal issues.
She said if growth does not create employment, reduce poverty and widen income inequality, the economic expansion does not make any sense.
She said data that show Bangladesh is unaffected economically by the pandemic will ultimately affect external concessional debt flow.
Speaking at the function, Dr. Rahman said such data gives wrong signals to the people, including the policymakers.
He said if the BBS data is correct then the nominal GDP stands at around 11 per cent.
"I have calculated the nominal GDP will be 11 per cent, but my question is why tax revenue collection is so poor?" he said. In April, total revenue collection plunged by 36.6 per cent.
He said such a GDP is the reflection of political philosophy.
Dr. Khandker Golam Moazzem said according to the GDP estimate, the per capita income reached US$ 2,064 during the last financial year.
The CPD said the poverty rate may go up to 35 per cent and the government is also strengthening the social protection programmes.
"If there is high growth, then why do you strengthen social protection?" he questioned.
While presenting the keynote paper, Mr. Khan said the government must appreciate the value of data integrity.
Dr. Moazzem advocated for measuring GDP on a quarterly and regional basis.
He said the operating expenditure of the government was just 50.4 per cent as of April last.
The foreign direct investment had plummeted by 42.5 per cent in the past fiscal year.
At 8.6 per cent, the private sector credit growth was the lowest in a decade.
Import of capital machinery declined by nearly 34 per cent while export declined by over 51 per cent during April-June period.
The implementation of the Annual Development Programme was just 80 per cent.
He said the BBS should urgently take steps to generate credible and updated data.