BNP believes in Bangladesh Bank’s independence, not just autonomy: Khasru

Bangla Press Desk:  BNP Standing Committee Member Amir Khasru Mahmud Chowdhury said on Tuesday that the party is firm in supporting the full independence of Bangladesh Bank, not just its autonomy.

“BNP, from its political standpoint, fully supports granting proper independence to the Bangladesh Bank,” he said while speaking at a seminar titled ‘The Imperative of Central Bank Independence’ organised by the Policy Research Institute of Bangladesh.

During their tenure, Khasru said, no appointments at the central bank had been politically motivated.

He, however, acknowledged that there might be debates over whether the appointments were good or bad, but asserted that they could firmly say the appointments were never politically influenced.

The BNP leader claimed that all major economic reforms in Bangladesh took place under BNP governments, and it was the BNP that freed Bangladesh Bank from the dual control of the Finance Ministry’s bureaucracy.

Khasru, however, cautioned that merely granting independence to the central bank would not be effective without addressing other systemic issues. “The government must reduce its dependence on bank borrowing,” he said.

“There is virtually no effective capital market in the country now. Yet, it could have been a major source of government financing. Strengthening the capital market is crucial to ensure diversified sources of funding,” Khasru said.

He also stressed the importance of developing a strong bond market and empowering the private sector, saying the culture of printing money and providing long-term loans based on short-term deposits must end.

Emphasising better coordination among financial institutions, he said, “If Bangladesh Bank becomes independent but fails to coordinate with other financial entities and the capital market, this independence won’t take us far.”

Khasru further suggested bringing the National Board of Revenue (NBR), the Bangladesh Investment Development Authority (BIDA), and Bangladesh Bank under full automation to ensure faster operations and reduce corruption.

“The less physical contact there is in financial institutions, the better,” he said.

He also expressed concern that the existing civil service pay structure would fail to attract skilled professionals to the central bank. “We must consider a separate pay package for Bangladesh Bank officials,” he suggested.

“When I was Commerce Minister, the Tariff Commission was run by contractual experts. Civil servants alone cannot efficiently manage financial institutions — the same principle should apply to Bangladesh Bank,” Khasru added.

Speaking at the event, Bangladesh Bank’s Chief Economist Dr Akhtar Hossain said the independence of the central bank is essential to achieve inflation control through effective monetary policy.

He, however, emphasised that such independence should be established without creating any conflict within the government framework.

BP/SP