Bangladesh’s credit rating

On Tuesday, it was announced that Standard & Poor’s, one of the three major credit rating agencies in the world would begin covering Bangladesh in its periodic ratings assessments.

Unto itself, this story would have been only of mild interest to most business readers in Pakistan, but what made it extraordinary was the fact that Bangladesh, a country that has half the average national income as Pakistan, has a credit rating of BB-, a full rating above Pakistan’s own miserable B-.Of the four countries in South Asia rated by Standard & Poor’s, Pakistan has the lowest credit rating, reflective in large part of the country’s inability to collect taxes.

Pakistanis tend to care a lot about how the rest of the world perceives the nation, yet the fact that the “full faith and credit” of the government of Pakistan is quite literally deemed to be worth “junk” by the international bond markets does not seem to be enough to jolt people out of evading their taxes.

The example of Bangladesh is quite evident in suggesting that it is not a matter of income levels that result in better governance in a country, but rather a clear commitment by both the government and the people to improving the economic welfare of the nation as a whole. Yet we as a nation refuse to take responsibility for anything. Indeed, when discussing any problem confronting the nation, many are likely to use the second person (“your country”, rather than “our country”) as a means of deflecting responsibility.

We would like to congratulate the people and government of Bangladesh for what appears to be a reasonable credit rating and hope that it serves as a motivator for the people and government of our country to get our collective act together. The Federal Board of Revenue has made a start by finally acknowledging the rather obvious tactics used in evading taxes.