The government is making an upward revision to a few growth targets in the medium term macroeconomic framework (MTMF) as it is sensing a more-than-expected rise in exports during the second half of current fiscal, official sources said.
"A draft MTMF was prepared on the basis of a conservative export growth target during the first half of the fiscal. And now that there is a trend of more-than-expected growth in exports, some changes are being brought in the framework," said a senior official in the Ministry of Finance.
The three-year MTMF aims at incorporating different macroeconomic indicators up to 2006-07 fiscal.
The official pointed out that the MTMF was being finalised after calculating latest statistics available from the Bangladesh Bank (BB), Bangladesh Bureau of Statistics (BBS) and Ministry of Finance.
Concerned officials said the General Economic Division (GED) of the Planning Commission projected two scenarios - baseline or conservative and adjustment scenarios - while preparing the MTMF.
According to adjustment scenario, the GDP (gross domestic product) growth rate has been projected at 5.5 per cent in 2004-05 and 6.2 per cent and 6.8 per cent respectively in the next two fiscals.
As per the same scenario, the export sector is expected to register a growth of 12 per cent in 2004-05, whereas 10 per cent and 12 per cent in 2005-06 and 2006-07 respectively.
But in the baseline scenario, the GDP growth was projected at 5.5 per cent in 2004-05 followed by 6.0 per cent and 6.5 per cent in 2005-06 and 2006-07 respectively.
In the export front, the growth was predicted at only 9.0 per cent in 2004-05, while 6.0 per cent in 2005-06 and 7.0 per cent in 2006-07 in line with the aforementioned scenario.
A Planning Commission official told the Financial Express that Finance and Planning Minister M Saifur Rahman recently approved the adjustment scenario considering rising trend in the export growth.
Explaining the reason behind the approval of the adjustment scenario, the official observed the baseline or conservative scenario was prepared keeping in mind the last flood and the possible negative impact of post-MFA (Multi-Fibre Arrangement) on the export-oriented readymade garment (RMG) sector.
"Despite the flood and elimination of the quota system, the export sector is most likely to experience a growth of 12 per cent by the end of current fiscal. That is why, the adjustment scenario was taken into consideration," he elaborated.
He also said the revised MTMF will ultimately be incorporated in the final PRSP (poverty reduction strategy paper).