Single-Digit Interest Rate and Future of Bangladesh Economy: A Brief Analysis

Author:

Lizon Mia

Ankan Chandra Dey

Md. Tanjil Hossain

Journal: Bangladesh Journal of Political Economy

(pp: 191-198) | Doi No: http:/doi.org/10.56138/bjpe.jun2212

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Abstract

Investment plays a vital role in employment. Interest rate is the main factor that determines the investment. The government of Bangladesh has implemented a single-digit interest rate to increase investment and employment. As of July 1, 2018, the government allowance has reduced the bank interest rate to a single digit. We evaluate statistics data from 2011 to 2020 and find that investment and employment do not vary much before and after the single-digit is established. We see a slight increase in investment after setting single digits, but no change in employment.

Along with the reduction of interest rate investment climate have to be improved. Investment climate includes technological improvement, stimulus package, cost of doing business, property rights law, and good governance after implementing reduced single-digit interest rate investment. It may be for the worldwide pandemic.

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Md. Anishur Rahman

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+88 02 222225996

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