Dhaka, Bangladesh (BBN)– Central banks may play an important role to boost trade and investment in South Asia, Bangladesh Bank (BB) Governor Dr. Atiur Rahman said on Thursday.
“As advisors to government on macroeconomic and development strategies and policies, South Asian central banks can usefully influence decision processes towards hastening ever greater openness and integration in intraregional trade and investment, as also in freer movement of people in the region across national borders,” BB Governor Dr. Rahman explained.
Dr. Rahman was speaking on the role of central banks in promoting South Asian economic cooperation at the second International Conference on South Asian Economic Development, organised by South Asian University, New Delhi.
“South Asia will need to boost domestic demand driven growth to make up for the weaker gains in export driven growth,” the BB governor observed.
He also said stimulating domestic demand driven growth entails pursuing a broad menu of well coordinated near and medium term policy support agenda, including financing of technical and marketing knowhow for MSME (Micro, Small and Medium Enterprises) output initiatives on the supply side, and incremental employment and income generation on the demand side.
Dr. Rahman emphasized the BB initiatives which are helping to maintain a sustained thrust for inclusive financing to support MSMEs. He also shed light on the role of the central banks of South Asia.
Possible areas of further deepening of cooperation between South Asian central banks include analytical research on monetary and macroeconomic issues impacting the region, region wide systematic evaluation of various central bank initiatives in promotion of inclusive and green financing, financial market deepening and development, the BB governor added.
In his lecture, Dr. Rahman discussed how regional cooperation efforts comprise a significant dimension of development initiatives in South Asia.
Country level efforts bolstered by collective cooperation initiatives have paid the region well by transforming South Asia into one of the few robust hubs of global growth but sustenance of this growth and development momentum faces quite a few challenges now on diverse fronts, according to the BB governor.
Among others, Dr. C. Rangarajan, former Governor of Reserve Bank of India, Dr. Santosh C. Panda, Dean and Professor, Faculty of Economics, South Asian University, and Dr. Kavita A. Sharma, President of South Asian University were also present in the conference.