In next fiscal year, the budget deficit will be more than 5% of gross domestic product breaking years of practice as the government focuses on winning voters' heart ahead of the general election.
Finance ministry officials said it's the government high-up decision to keep the budget deficit above 5% of GDP with major funds coming from the banking sector to address the gap.
Official sources said Prime Minister Sheikh Hasina asked the authorities concerned not to take any step in the fiscal year 2017-18 budget that could tarnish the image of the government before national election.
Finance Minister AMA Muhith is going to place the national budget in the Parliament on Thursday. This will be his 11th budget to be placed in Parliament.
According to the budget documents, the next fiscal year's projected deficit is going to be Tk1,12,275 crore.
This is Tk5,595 crore or 5.24% higher than that of the revised budget of the FY2016-17.
The revised budget deficit is Tk1,06,680 crore but the announced budget deficit was Tk97,850 crore. The projected total GDP of the FY2017-18 is Tk22,24,300 crore.
To meet the deficit, the government will borrow Tk48,960 crore from the banking sector. The other part of the deficit will be met by the funds from foreign sources, the documents cited.
The size of next fiscal year's budget is likely to be Tk400,266 crore -- the highest in the country's history and yet another milestone for the current Awami League government.
When the government assumed power in 2009, it set a record by setting a budget of Tk110,524 crore in the FY2009-10 -- the highest then.
Total earning of the government will be Tk2,88,000 crore in the next fiscal year with a total ADP expenditure of Tk1,53,000 crore.
The size of the current year's budget is Tk340,605 crore, but it was downsized to Tk317,180 crore in the revised budget.
“With the 5% budget deficit of GDP, the government will not fall in financial problems,” AB Miza Azizul Islam, a financial sector analyst and ex-adviser to caretaker government, told the Dhaka Tribune.
He said the credit worthy of the country will be in trouble due to the increased budget deficit.
“Greece is a big example of uncontrolled budget deficit,” he adde
Thursday, April 25, 2024
