FE Report

The country's both the bourses welcomed the proposed budget terming it market-friendly as the government gave importance on raising fund from the market instead of taking syndication loan from the banks.

The Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) feel encouraged for the positive steps taken in the budget, what they said, that will make the market more vibrant and buoyant.

"We welcome the proposed budget as it will attract the local and foreign investment and expedite the industrialisation," said DSE president Md Rakibur Rahman in a post budget reaction in a press conference Sunday.

"The new idea public private partnership (PPP) budget will contribute to develop the market as well and ensure involvement of participation of the general people," he said adding that PPP is a vehicle to attain the higher growth and investment infrastructure development.

The budget for the 2010 fiscal year has proposed to allow disclosure of undisclosed money by paying 10 per cent tax if invested in share market, infrastructure, specific industrial sectors and real state. The opportunity is being reserved for three sectors for there years till 2012.

"Allowing black money investment in the stock market is very positive, which will help boost the market," the DSE boss said.

The budget proposed to reduce the corporate tax for mobile phone operators to 35 per cent subject to the condition that they are listed in the stock market and at least 10 per cent shares of the company's paid up capital is transferred, of which pre IPO placement cannot exceed 5.0 per cent.

"This is another favourable decision for the stock market as it will help increase the supply of the securities," the Rakibur said adding that it will also minimise between demand and supply of the shares.

The bourse urged the government to reconsider their proposal of prefixing corporate tax of 45 per cent in an effort to lower their cost of fund and to give more corporate benefits for their shareholders.

CSE president Nasiruddin Ahmed Chowdhury, in a press statement, said the stock market is an alternative source of raising fund for industrialisation, which was mentioned in the proposed. This is very encouraging proposal for the market, he added.

He demanded to reduce 0.015 per cent tax from the proposed 0.025 per cent on total turnover for the sake of stock market's development.