Privatizaion problem in Bangladesh

Is Privatization good for Bangladesh?

Privatization has been advocated in the development literatures as the gateway of the growth and development of the countries all around the globe. Some could achieve the desired goals and some failed enormously. The reasons of their failure include structural constraints, inappropriate policy guidelines, imposed instruction and ineffective implementation strategies. However, the World Bank and the IMF have been gearing up the campaign of privatization for less developed countries (LDCs) to stimulate their growth and development.

 

After liberation in 1971, Bangladesh inherited an economy dominated by private sectors. The new government, led by Sheikh Mujibur Rahman was committed to socialism and nationalized the heavy industries that were previously run privately. It also faced an industrial ownership vacuum as fleeing West Pakistanis abandoned their industrial and commercial companies.

 

Unpredictable and poorly administered government policies also create problems. High taxes, frequently changing tax rates, arbitrary interpretations of tax rules and other harassment by tax authorities usually raise the cost of doing business and discourage restructuring. The lack of legal and economic information, including market studies and company diagnostics could also be a problem. It has been found that in spite of making promises, no regime in Bangladesh has come out with a clearly stated privatization policy which would both spell out its underlying logic and provide a coherent set of guidelines to define its direction.

There are a number of potential sectors for privatization in Bangladesh some of which are mentioned below:

Power Sector

Natural Gas and Oil Exploration

Tele Communication

Transport Sector

Port and Container Handing

Aviation and Tourism

Banking and Insurance and so on.