The Centre for Policy Dialogue (CPD) today said the government should provide cash aid to 1.9 crore poor households across the country to help them cope with the ongoing coronavirus crisis and the subsequent blow to the economy.

"We propose that these households be provided with Tk 8,000 per month for two months," Fahmida Khatun, executive director of CPD, said during a virtual media conference on "Initial Assessment of Public Policy Interventions and Proposals for Food and Income Security of the Marginalised".

The cash transfer programme was proposed keeping in mind an estimated need of Tk 2,000 per week for each household.

The cash incentive will help stimulate small local businesses as people can afford to buy essentials. This will in turn also be an indirect stimulus for large businesses. The cash transfer will generate Tk 186,573 crore worth of demand for goods and services in the economy, Khatun said.

The cash incentive for the poor households is expected to cover around 7.57 crore citizens across the country, for which the government will require Tk 29,852 crore.

The CPD's assessment showed that such a transfer will generate 6.25 times the money initially injected into the economy.

People belonging to the lower income group, particularly those employed in the informal sector (about 85 percent of total employed population), are among the most vulnerable, the CPD said, adding the "lockdown" strategy will only be successful if the state is able to protect its lower income population and provide them food security.

The think tank also stressed on keeping corruption at bay and said the government has expressed its intention to ensure good governance in providing assistance to the marginalised during the ongoing pandemic.

It also focused on public expenditure and laid out some ways on how to reduce its pressure.

"Expenditures such as foreign travel, acquisition of assets, investment in shares and equities, loans and recapitalisation to state-owned enterprises should not be prioritised as much," the CPD said.

The think tank further suggested that an immediate exercise be undertaken to assess the possibility of slowing down of development expenditure for low-priority projects, particularly those which are in the early stages of implementation.