Tk 6.0-trillion budget to be placed in parliament on June 3

[Black_cats]

Tk 6.0-trillion budget to be placed in parliament on June 3

FE REPORT | Published: May 06, 2021 09:21:20 | Updated: May 06, 2021 09:41:06

The government is expected to place a Tk. 6.0 trillion national budget for the fiscal year (FY2021-22) in parliament on June 03 next, people familiar with the development said on Wednesday.

They said the new budget would set an economic growth target at 7.0 per cent against the original target of 8.2 per cent in the last fiscal year.

The budget session of the parliament is scheduled to begin on June 02, according to a Jatiya Sangsad (national parliament) source.

The original budget size in the last fiscal year was Tk 5.68 trillion.

The finance division is now preparing the budget against the backdrop of an unusual socio-economic condition, marked by the Covid-19 pandemic. The government had faced identical situation while framing the budget last year.

"We will hopefully place the budget before the parliament on June 03," an official at the finance division told the FE.

The budget would set a higher borrowing target from the external sources to meet the deficit, which will go beyond 5.0 per cent of the GDP, he said. "We have almost finalised the deals on budget supports worthTk1.0 trillion from the external sources."

He said the external funding is much cheaper than the internal finance and the interest rate is just 2.0 per cent.

The domestic borrowing will mainly come from banking source which is now liquid enough to finance the deficit.

In the meantime, economists said that targeting the external sources was in the right direction. They, however, warned that it would be tough to get the external fund released if the government plans to utilise resources from the existing pipeline.

They suggested the government to focus more on increasing investment both in public and private sectors.

Dr Ahsan H. Mansur, executive director at the Policy Research Institute of Bangladesh (PRI) said: "The budget should have basic goal of expediting the overall investment. Otherwise, enough demand will not be generated in the economy."

He said: "Poor demand means poor job creation."

Dr Mansur, however, said the government must contain the coronavirus infection to facilitate investment in the country.

Dr. Zahid Hussain, an independent economist, express his surprise over the government's decision to get higher funding from the external sources.

"If the external funding is in the form of project aid, then we'll have to improve capacity. Otherwise, we'll not get the fund in the right time."

He said that there is a huge project aid in the pipeline. These fund could not be utilised due to lack of project implementation capacity.

The government is now negotiating with the Asian Development Bank(ADB) for a big amount of fund as budget support.

Dr. Hussain, however, said the budget should emphasise on the health sector, social safety net programme, education and agriculture sectors considering the pandemic and its impact on the people and the economy.

Projects that would create employment and the labour-intensive ones should get priority, he added.

jasimharoon@yahoo.com

Tk 6.0-trillion budget to be placed in parliament on June 3

The government is expected to place a Tk. 6.0 trillion national budget for the fiscal year (FY2021-22) in parliament on June 03 next, people familiar with the development said on Wednesday. They said the new budget would set an economic growth target at 7.0 per cent against the original target of

thefinancialexpress.com.bd

 

[Bilal9]

Dr. Zahid Hussain, an independent economist, express his surprise over the government's decision to get higher funding from the external sources.

"If the external funding is in the form of project aid, then we'll have to improve capacity. Otherwise, we'll not get the fund in the right time."

He said that there is a huge project aid in the pipeline. These fund could not be utilised due to lack of project implementation capacity.

The government is now negotiating with the Asian Development Bank(ADB) for a big amount of fund as budget support.

Dr. Hussain, however, said the budget should emphasise on the health sector, social safety net programme, education and agriculture sectors considering the pandemic and its impact on the people and the economy.

Projects that would create employment and the labour-intensive ones should get priority, he added.

Listen to this man, his words are worth their weight in Gold.

He used to be a longtime adviser of the world bank in Dhaka, but his opinion is universally respected in Bangladesh, even by detractors.

What he says is VERY true about the govts. inability to execute development projects, even with armies of hired consultants from all of Asia.

Zahid Hussain | Lead Economist

Zahid Hussain joined the World Bank in 1995 and is currently a lead economist in the South Asia Finance and Poverty group. Prior to that, he was a member of

blogs.worldbank.org

 

[F-6 enthusiast]

Maybe we will find out if money is allocated to buy EFT

 

[DalalErMaNodi]

70.7 Billion USD for anyone wondering..

 

[khansaheeb]

Listen to this man, his words are worth their weight in Gold.

He used to be a longtime adviser of the world bank in Dhaka, but his opinion is universally respected in Bangladesh, even by detractors.

What he says is VERY true about the govts. inability to execute development projects, even with armies of hired consultants from all of Asia.

Zahid Hussain | Lead Economist

Zahid Hussain joined the World Bank in 1995 and is currently a lead economist in the South Asia Finance and Poverty group. Prior to that, he was a member of

blogs.worldbank.org

It's good to see Bangladesh achieving it's true potential.

 

[Destranator]

Maybe we will find out if money is allocated to buy EFT

Egypt is buying 30 more Rafales for $4.5 bn on a 10 year loan.
I believe we will get some form of finance for EFTs in which case funding will be released by the govt over years.

 

[F-6 enthusiast]

Egypt is buying 30 more Rafales for $4.5 bn on a 10 year loan.
I believe we will get some form of finance for EFTs in which case funding will be released by the govt over years.

i mean we will have to fund some of it. like a deposit maybe idk

 

[Bilal9]

70.7 Billion USD for anyone wondering..

Well ahead of the norm in the neighborhood with US$500 Billion in India for 2021-22. Bangladesh economy was 1/8th the size that of India until recently.

 

[Protest_again]

Well ahead of the norm in the neighborhood with US$500 Billion in India for 2021-22. Bangladesh economy was 1/8th the size that of India until recently.

India has state budgets too, some larger than Bangladesh.

Every year Bangladesh presents a inflated budget but when revenue doesn't match the budget estimates they revise them down. This fiscal your revenue is down 1.5 trillion taka from budget estimates. You can go back and check history.

 

[Destranator]

i mean we will have to fund some of it. like a deposit maybe idk

Yes, it would depend on the terms of finance.

 

[Bilal9]

India has state budgets too, some larger than Bangladesh.

Of course they do, if they are more populous and/or more industrialized than Bangladesh. But we're making progress, that is all that matters.

India had a 25 year head-start and a huge market to boot. Which we did not. The Indian states that are more developed owe it in no small measure to the rest of India (undeveloped BIMARU type states), attracting the best brains/labor from them and also selling them products....

Ten years ago, anyone would laugh if someone said that Bangladesh per capita GDP would be higher than that of Indian aggregate. But it is reality today.

 

[Homo Sapiens]

Well ahead of the norm in the neighborhood with US$500 Billion in India for 2021-22. Bangladesh economy was 1/8th the size that of India until recently.

If fact India's total (Central+states) budget spendig is twice GDP percentage wise of Bangladesh. Five hundred billion is their central budget, total budget is around 850 billion dollar. Another fact is, Bangladesh govt. may be placing 71 billion Dollar budget, but at the end of fiscal year, actual spending would be around 60 billion Dollar due to massive gap between targeted revenue collection and actual materialization. Bangladesh is among the bottom 5 in the world when it comes to revenue collection, only Nigeria and some other Sahelian countries in Africa has similar revenue collection of Bangladesh.

List of countries by government spending as percentage of GDP - Wikipedia

en.wikipedia.org

If we want to spend like other developing countries then our budget spending should be almost twice of current level(from 15 percent of GDP to 30 percent of GDP). This low revenue collection and spending is the reason, our education budget is one of lowest in the world GDP percentage wise, health care budget is lowest, infrastructure spending is the lowest in the region(China and Vietnam spend 9 or 10 percent of GDP in infrastructure, while Bangladesh's spending is just 3 percent), defence spending is low and many other limitation which is hindering our rapid progress. Our GDP may be rising fast, but our quality of education, health care, infrastructure remain behind the level.

 

[Bilal9]

If fact India's total (Central+states) budget spendig is twice GDP percentage wise of Bangladesh. Five hundred billion is their central budget, total budget is around 850 billion dollar. Another fact is, Bangladesh govt. may be placing 71 billion Dollar budget, but at the end of fiscal year, actual spending would be around 60 billion Dollar due to massive gap between targeted revenue collection and actual materialization. Bangladesh is among the bottom 5 in the world when it comes to revenue collection, only Nigeria and some other Sahelian countries in Africa has similar revenue collection of Bangladesh. If we want to spend like other developing countries then our budget should be almost twice of current level(from 15 percent of GDP to 30 percent of GDP). This low revenue collection and spending is the reason, our education budget is one of lowest in the world GDP percentage wise, health care budget is lowest, infrastructure spending is the lowest in the region(China and Vietnam spend 9 or 10 percent of GDP in infrastructure, while Bangladesh's spending is just 3 percent), defence spending is low and many other limitation which is hindering our rapid progress. Our GDP may be rising fast, but our quality of education, health care, infrastructure remain behind the level.

@Homo Sapiens bhai, Bangladesh did not do badly, even with a lower per capita spending in terms of health compared to India. Many of our health-related HDI figures are higher than theirs.

 

[Homo Sapiens]

@Homo Sapiens bhai, Bangladesh did not do badly, even with a lower per capita spending in terms of health compared to India. Many of our health-related HDI figures are higher than theirs.

This is true that Bangladesh achieved remarkable progress in health and education despite low public spending, but we can not go forever like that, now time has come to double or even triple our current spending GDP percentage wise on health, education, infrastructure and some other sectors like defence. This is possible only if Govt. rapidly expand it's capability to collect tax and non Tax revenue ASAP.

 

[Protest_again]

Of course they do, if they are more populous and/or more industrialized than Bangladesh. But we're making progress, that is all that matters.

India had a 25 year head-start and a huge market to boot. Which we did not. The states that are developed owe it in no small measure to the rest of India....

Ten years ago, anyone would laugh if someone said that Bangladesh per capita GDP would be higher than that of Indian aggregate. But it is reality today.

You can rely on whatever figures to make you happy. Tax collection is hard number collected in cash. GDP, Health numbers are just numbers(BBS magic if I might say) there is no reliable way to check one way or the other.

Just take the tax revenue collected for this fiscal for both India and Bangladesh. India's central govt tax collection is over 22 trillion INR (25 trillion taka) while that of Bangladesh will be about 2.5 trillion taka. India's state's own tax collection is about 60% of central collection ie., about 15 trillion taka. Put together India's tax collection is about 40 trillion taka.

Bangladesh can put up how many ever trillions it wants in Budget but the revenue collection is a generation behind than the fantasy they show in Budgets.