ADBI E-Newsline

"Monetary management currently faces a bigger challenge from an unusual source -- remittances. Despite the global economic slowdown migrant workers increasingly chose the formal route for sending money home. As a consequence, the country received a total of $9.7 billion in remittances as of the end of June, a growth of 24 percent over the previous year.

But burgeoning remittances have been causing headaches for the country's monetary authorities. As remittance flows increase, commercial banks surrender the dollars to the Bangladesh Bank in exchange for local currency. The upshot of this process has been the expansion of bank reserves, which leads to more money creation in the economy."

"The drought India faced this year was perhaps only one manifestation of the global phenomenon of warming and climate change. The government is yet to come to terms with extremes of temperature and precipitations alternating at more rapid intervals. India is not prepared for facing a situation where 'under the sky' agriculture becomes non-viable, if not impossible. A shift to 'covered agriculture' and sophisticated systems of irrigation and fertilization will require massive amounts of capital.

That kind of money will not come without substantial modifications in the budgetary priorities of both the central and state governments. The current situation does not appear to permit an allocation of 20-30 percent of budgetary resources to agriculture for two or three years. The government is unprepared for a radical transformation in Indian agriculture."

"The Thai government is targeting a bigger role for the private sector in boosting economic growth, raising the value of projects it expects to finance in partnership with private investors to 10 percent of its 1.43 trillion baht ($43.07 billion) investment budget from the currently planned 2 percent, a senior finance ministry official said.

Mass transit and road projects are among the first that will be launched under the new guidelines. Some 145 billion baht is expected to be financed via Public-Private Partnerships while the remainder will come from the government's budget, state borrowing and retained earnings of state enterprises."

"For Kabul's estimated population of 4-5 million there are only 35 public toilets, according to municipal authorities. 'We need at least 65 extra public latrines in Kabul immediately,' said Nesar Ahmad Habibi, head of Kabul's waste management authority, adding that the lack of government action and limited resources had prevented the construction of sufficient public toilets in the city.

People who use the latrines have to pay a small fee to cover maintenance and cleaning -- 5-10 Afghanis (10-20 US cents), a sum that the large number of extremely poor people in the city would prefer to avoid paying. A rapidly growing population, lack of modern sewage systems, significant waste management problems and the lack of public toilets in Kabul are causing environmental and health risks, according to experts."

"Another sugar crisis is looming in Pakistan as farmers are not ready to sell sugarcane to the mills on credit and are demanding cash payments, industry insider said. They said there are multiple reasons for not selling sugarcane to the millers including less sugarcane production and the prevailing sugar crisis.

The farmers are not ready to sell sugarcane on credit or on Cane Purchase Receipt (CPR) due to high demand. The farmers are offering Rs 100 per 40 kg for sugarcane and said they would only give their crop at cash. Last year, there were 50 million tons of sugarcane production. The target for this year was set at 57 million tons, however, the production dropped to 48 million tons. The water shortage, delayed payments of sugarcane to the farmers by the mills, frost attack and less availability of fertilizers was other reasons for low production."

"The Philippines wants the private sector to fund half of the country's infrastructure needs for the next five years because of the state's lack of funds. Based on documents obtained from the National Economic and Development Authority, the government's Comprehensive and Integrated Infrastructure Program would require P3.33 trillion ($70.4 billion) from 2009 to 2013.

Over the last 10 years, investments in public-private partnership projects averaged $2.18 billion a year, or 1.9 percent of gross domestic product. This is a little above the public investment of 1.6 percent of GDP for 2006. Infrastructure spending in the Philippines was 4.3 percentage points below nominal GDP growth and 3.5 percentage points below total tax collection growth."

"A recent report highlighted the colossal wastage of natural gas in Bangladesh. The country incurs a loss of $590 million every year through the wastage of 50 percent of gas due to inefficient utilization in worn out industrial units. Gas consumption efficiency levels in all types of power plants ranging from 20 percent to 33 percent. According to experts, daily gas demand could easily be met from the existing production if proper use could be ensured.

The government should turn to the use of modern machinery for maximum and cost effective use of this most valuable energy resource. Use of dilapidated machines should be stopped by all means. Pilferage of gas, reportedly at six percent, should also be stopped."

"Indonesia's small-scale palm oil farmers are not acquiring certifications as environmentally friendly producers because it is expensive and certified palm oil does not command a premium on world markets. The government had made little progress in getting small growers to obtain green certification. Before plantation owners can become green-certified they also need to get a land certificate.

Small-scale farmers own about 3.3 million hectares of palm oil plantations -- about 46 percent of the country's 7.7 million hectares. Private-sector companies own 43 percent of the plantation area and the remainder is owned by state-owned firms. About 80 percent of the plantations belonging to small-scale farmers had yet to be certified."

"Sri Lanka is investing heavily to develop its infrastructure. An investment of $2 billion to upgrade roads, rail tracks, airports and power will be the main driver of GDP into the next decade said the public administration and home affairs minister. He said that Sri Lanka is entering a new phase of economic growth after the three-decade conflict.

Sri Lanka has been growing at an average five percent per year for nearly a decade. Connectivity, proximity to India and India's rise as a global economic giant will have an effect on Sri Lanka. The country's largest industry, tea production had passed the $1 billion mark. The private sector accounts for 80 percent of the economy in Sri Lanka."

"Bangkok has long been vulnerable to flooding. Poor urban planning and careless expansion have made the problem worse. Some climate experts and city planners say future floods may cause lasting damage because of rising sea waters. An expert says the government should consider building an 80-kilometer long system of dikes at the mouth of the Chao Phraya River basin to hold back rising tides. The proposal is estimated to cost more than $3 billion.

Poor planning and urban development have allowed many canals to be filled to make way for roads and other development. Planners need to consider restoring the canal system. Bangkok also faces the threat of coastal erosion from rising seas and storm surges."

"Escalating food prices have thrust the poor into deeper poverty and hunger in Pakistan, making them rely on soup kitchens. 'About two to four percent of Pakistan's population is mobile and homeless,' said Kaiser Bengali, a senior economist. They stay wherever they find work. They have no address, no education, no birth certificates and therefore no identity cards, a pre-requisite for individuals who want to avail themselves of any formal government-initiated social protection programs for the poor.

Against this backdrop, 'the soup kitchens are the need of the hour,' said Bengali. To some experts, however, soup kitchens -- for all their noble intentions -- may only be dishing up nibbles that may never fully address the growing hunger now gripping Pakistan over the long haul. What is needed, they say, is a more lasting and sustainable solution to the gnawing hunger pangs afflicting many."

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