Bangladesh has been maintaining macroeconomic stability over a long period but could not achieve the expected growth and the result of whatever growth it had posted did not reach the grassroots level, observed some leading economists.

They said because of this reason inequality in the society has become one of the major issues which the government should address immediately for poverty alleviation and sustainable economic development in the country.

"Bangladesh is the only country in South Asia which had a macro economic stability over the last one and a half decades but the stability did not bring expected growth. On the other hand some south Asian countries like Bhutan, which had volatility in its macro economy, achieved higher growth," said Debapriya Bhattacharya.

At the same time the result of the growth did not reach the poor due to lack of good governance and other structural problems, he added. Besides, major investments went into those sectors which do not create employment for the poor, he observed focusing on rising inequality in the society.

Governor of Bangladesh Bank Dr Salehuddin Ahmed, however, termed the view as simplistic saying that there is no alternative to maintaining macroeconomic stability for poverty reduction and economic growth.

"If there is no macroeconomic stability, other economic indicators will not perform well," he explained. "So it's a necessity."

He said there should be some structural reforms for brining equality in the society.

The Bangladesh Bank governor stressed the need for a change in the nature of growth. The growth should touch the people, he said. He also said the central bank is now giving instruction to the banks to provide loan for those projects which generate employment.

The lively debate on country's economy took place at a seminar in CIRDAP auditorium yesterday organised by the Centre for Policy Dialogue (CPD).

CPD Chairman Prof Rehman Sobhan chaired the discussion while renowned economist Prof Wahiduddin Mahmud, former Bangladesh Bank governor Dr Fakhruddin Ahmed and Dr SR Osmani were the discussants. Two keynote papers were presented at the seminar on growth and equality in South Asia and on how has Bangladesh performed.

Dr Shantayanan Devaranjan and Dr Ijaz Nabi of the World Bank prepared one of the keynote papers, and Dr Debapriya Bhattacharya and Dr Fahmida Khatun of the CPD prepared the other.

"Budgetary contribution to the public sector savings was negative in South Asia while it was positive in East Asia which makes the main difference between the economies of the two regions," said Dr Wahiduddin Mahmud.

He said the recent oil price hike and government borrowing from the banks have created some problems.

Mahmud further said reducing interest rates would have been better than relaxing conditions for loan defaulters.

He, however, observed that Bangladesh performed better in some human development sectors than many other South Asian countries.

Dr Fakhruddin Ahmed stressed the need for focusing on productivity and technology adoption. Otherwise, there will not be a faster growth in the economy, he said.

Dr SR Osmani said instead of comparing macroeconomic stability with growth, one should see the degree of instability that the country can accommodate.

Former finance ministers AMA Muhith and M Syeduzzaman, Abdur Razzaque MP, Dr QS Alam, Prof MM Akash, Dr Naimuddin Chowdhury, Prof Momtazuddin, AKM Shamsuddin, Syed M Ahsan, President of the Metropolitan Chamber of Commerce and Industries (MCCI) Latifur Rahman, President of the Dhaka Chamber of Commerce and Industries (DCCI) MA Momen, and Dr SK Maqsood Ali took part in general discussion.