Government officials are set to meet officials of the World Bank on Thursday for fund negotiations to meet the former's budget-deficit financing.
The finance secretary, along with the secretary of the Economic Relations Division (ERD) and World Bank representatives will sit for a policy meeting in Dhaka to settle a proposed budget-support fund from the global development financier, said a Ministry of Finance (MoF) official.
The government is expecting $500-$750 million worth of budgetary support titled "Green resilient and inclusive development policy credit (GRID)" from the global lender over next three years to meet the deficit in the budget outlay, he also said.
The official said: "We have also requested the WB to release remaining $250 million of the Recovery and Resilience Development Policy Credit (DPC)-II, another assured budget support, for facilitating the country's economic recovery."
Under a deal, the WB in April last had released the DPC-I worth $250 million.
The second tranche or Recovery and Resilience DPC-II is badly needed for the country in the next fiscal year (FY) 2022-23 as the budget deficit has already been projected high.
"We had also requested the Asian Development Bank (ADB) for providing US$1.0 billion worth of budget support too," the MoF official said.
He mentions that the national budget for the next fiscal year (FY) 2022-23 has been proposed with a massive Tk 2.45-trillion deficit in total allocation which needs budgetary support to offset the income-expenditure gap.
The deficit is nearly one-third of the total Tk 6.78 trillion worth of the proposed national budget and 5.5% of GDP or gross domestic product.
The deficit gets wider following the offering of higher subsidies in agriculture, power and energy sector, and increased incentives for industries and businesses, lower revenue collection against targets, waiver of VAT and taxes on different products and sectors, and expenditure for stimulus packages.