A.K.M. Atiqur Rahman:

Few months back, the Planning Minister of Bangladesh Mr. Abdul Mannan, in his speech at a meeting, highlighted the importance of remittance for our economy and development. In fact, it was natural to refer such an issue, which is not only strengthening the country’s overall development but is also a permanent source of financial well-being for the remittance-recipient families. In that context, his appeal to mobilise the remittance in the productive sectors for gaining maximum benefit is undoubtedly appreciating.

I must take the opportunity to express my sincere thanks to the Hon’ble Minister for understanding the issue. I further believe that he would be able to undertake the initiatives of proper utilisation of the hard-earned foreign currencies, better known as remittance, in the productive sectors so that both the country and the remittance-recipient families are greatly benefited. If he can make a planning as he thinks considering the practical situation of the spending of remittances, it would be a milestone in the history of remittance of Bangladesh. And obviously, both Bangladesh and the families of the migrants will feel the difference once their financial capabilities are strengthened.

In fact, we need to make immediately planning and guidelines for better utilisation of remittances in view of the following scenarios- (a) We do not know how long our people would be able to get the opportunities for overseas employment. That means, there remains the probability of opportunity constraints to earn remittances in the near future; (b) Remittance recipients use the larger part of the remittances for the expenses such as building or improving housing and buying land, cattle or durable consumer goods (like TV, motorcycle, etc.,) as well as repayment of loans for migration. A very small percentage of remittances is used for savings, education and investment in productive sectors. That means, a good amount of the hard-earned remittances is used for something not much essential for their livelihood. As there lacks reliable beneficial investment opportunities, the migrants are not attracted for investment of their savings and (c) Our returnee migrants have working experience/expertise, which are not also taken much care of. Their experience might be immensely helpful in nation-building activities if they are accommodated or placed properly.

We know that the words ‘migration’ and ‘development’ are closely related. These two words play an important role in the development process of the present-day world, especially the migrants sending and recipient countries. The development that we see today across the world, particularly in the developing countries, might not happen, if there was no migration. Obviously, the families of the migrants become financially better than before once they start getting remittances. Truly speaking, remittance sent by our migrants is one of the main sources of capital for the state treasury. In addition, a migrant worker, after staying abroad for so many years, returns with the capital of experience. But the tragedy is that neither their remittance is invested in any productive sector nor is the work-experience of the returnee-migrants utilised properly for a permanent earning source of livelihood.

In December 2017, I wrote an article on this page of the Daily Sun, in which I had suggested to create a ‘National Development Fund’ with the contribution of our migrant workers. I had mentioned there that we might collect at least one billion dollars a year from a monthly contribution of only US$10 per migrant. I had also mentioned about introduction of migrant bonds or remittance-backed securities. In addition, government or non-government organisations can use remittance as a security while collecting money from international capital markets. We can find a number of examples of such funds in the world.

In the Philippines, the Overseas Workers’ Investment Fund encourages migrant nationals to participate in official remittance schemes that are incentive schemes in character. Prodem, a regulated micro-finance institution in Bolivia, offers migrants’ families a premium interest rate if they deposit their remittances with the institution. It also provides easier access to small business loans to leverage remittances as collateral for such services. Banco Solidario in Ecuador has a programme named “My family, my country, my return”, which in cooperation with a Spanish bank, provides a package of loans (to finance the migrants’ travel back home or to set up a small business upon their return). In India, migrant workers returning to their home are given preferential access to capital goods and raw material imports to set up new industrial units or to participate in the expansion of existing businesses. Pakistani migrant workers can access a Non-repatriable Investment Scheme, which allows them, back in Pakistan, to import machinery and equipment at concessionary rates, provided that these funds are used to establish manufacturing enterprises in the country. Some governments provide “matching funds” to complement social investments, like a project in Mexico, where each dollar contributed as remittances is matched by three dollars (one from the municipality, one from the state and one from the federal government). This programme, with a total investment from migrants of about US$4.5 billion, has completed more than 400 projects in eight years.

If we can create such a fund, major development projects of the country could be implemented with that money. Then, Bangladesh will be able to avoid taking foreign loans restricted by various terms and conditions. The contributing migrants may also like to take loans from such fund to support their family business, or to set up a new business upon their return. Ultimately, this fund would strengthen not only the economic capability of the country, but would make us a self-reliant and dignified nation. Above all, the contributors of the fund get their share and will be able to pass a decent life with their families. However, there are people who were saying that the government cannot interfere in migrant’s personal affairs suggesting or forcing him/her to contribute for such a fund. It’s true that the remittance sender or recipient holds the right to use the money. In reality, it is happening. But if that money is invested in a more profitable sector under the management or supervision of the government, then migrant workers would be encouraged to subscribe to this fund. And this investment will not only improve the financial condition of the remittance receiving families, but will accelerate the pace of economic development of the country. However, it needs to formulate necessary policies and guidelines specifying attractive benefits in order to encourage remittance receiving families to come forward.

I would like to end by saying that the fund will be created for the interest of the migrants and not obligatory to contribute. As the remittances are the result of very hard work by relatively poor people, they will contribute voluntarily for their own benefit as they will be the owner of this fund. Migrants and their families could also be encouraged to use these funds in their individual projects. I believe that if they get attractive incentives from their investments in this fund, our migrants will not hesitate to come forward. Therefore, once again, I would like to urge our government to explore the ways and policies of creating such funds from our remittances as well as engaging the returnee migrants in economic activities.

The writer is a former Ambassador and Secretary.