Measures to reduce inflation and give relief to poor inadequate: CPD

The Centre for Policy Dialogue (CPD) today said that the government's target to reduce inflation to 6.5 percent in the fiscal year 2024-25 appears overly ambitious. 

The think-tank made the observation today in its analysis of the budgetary measures proposed by the government for the next fiscal year, which begins in July.

The CPD said that the FY25 budget lacks concrete measures to address ongoing economic concerns. 

"The strategies for curbing inflation and providing relief to the poor and those on fixed incomes are insufficient," said CPD Executive Director Fahmida Khatun during a media briefing at the Bangabandhu International Conference Centre.

The think-tank noted that despite high inflation levels, duties have been reduced on only a few essential items. 

"However, it remains uncertain whether this reduction in duty will result in lower prices for consumers," it added.

This perspective comes at a time when inflation has been persistently high, exceeding 9 percent for over a year, impacting the living standards of the poor and low-income families. 

In May, inflation increased to 9.89 percent from 9.74 percent in the previous month, with the annual average inflation standing at 9.73 percent.

The government projected an 8 percent inflation rate in FY24. However, the CPD pointed out that the entire FY24 experienced inflation of more than 9 percent. Given this backdrop, the inflation projection for FY25 certainly seems overly ambitious.

The organization also stated that the projected economic indicators for FY25 such as Gross Domestic Product (GDP) growth and investment, are ambitious and do not consider current realities. 

"As a result, many budgetary targets for FY25 will likely be missed. More importantly, due to the failure to acknowledge the nature of the ongoing economic challenges, the proposed budgetary measures are also inadequate and weak," it added.