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Tk6 trillion budget in the works for 2021-22, govt eyes increased outlay on capital expenditure

  • Published at 11:22 am April 18th, 2021
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Photo: Mehedi Hasan/Dhaka Tribune

Amid the coronavirus crisis, the government is working according to what it believes to be 'a comprehensive plan' with four main strategies

The government allocation for public expenditure on goods and services will witness a significant rise in the coming years after a slight dip in the last couple of years.

The government has estimated to spend Tk401.3 billion, which is 6.6% of the budget, for public expenditure in the coming 2021-22 fiscal.

The country is likely to get Tk5,933.14 billion budget for 2021-22 fiscal, Tk253.14 billion higher than the running one, aiming to face the Covid-19 pandemic challenge for recovering the economy.

The estimation for 2022-23 fiscal has been set at Tk465.2 billion, which will be 6.7% of the budget.

According to an official document, the allocation for the purpose in the running 2020-21 fiscal is Tk350 billion or 6.1% of the budget.

The document also reads that the government has estimated to bring down its expenditure in current account, including purchase of product and service, while increase the capital expenditure in the next two fiscals.


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It said that the current expenditure for 2021-22 and 2022-23 fiscal has been estimated at 54.4% and 54.5% of the total budget respectively.

As per the document, the government allocation for expenditure can be divided in current expenditure and capital expenditure.

Salaries and allowances of government employees, purchase of product and service, compensation and relocation expenses, payment of interest against foreign and domestic loans - these are all found under the current expenditure category. Besides, "food accounts" and "expense for structural coordination" are also under this expenditure.

On the other hand, capital expenditure is spending that leads to the creation of new productive assets and inclusion. It is akin to investment, so government-funded projects and project components in the annual development program (ADP), as well as non-ADP capital expenditure are the two main categories for capital expenditure.

Besides, loans and advance payments, development programs from revenue budget, projects outside the ADP and non-ADP Food for Work program and handover expenses fall under this expenditure.

The document stated that in the revised budget for the 2019-20 fiscal, the allocation for public expenditure on products and services was Tk322.1 billion, that is 6.5% of the budget.


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It also mentioned that in 2018-19 fiscal the allocation was Tk285.7 billion which was 7.3% of the budget that year.

In four previous fiscals 2017-18, 2016-17, 2015-16, and 2014-15, the allocations were Tk234.8 billion (7.3% of budget), Tk205.49 billion (7.6%), Tk182.05 billion (7.6%), and Tk166.27 billion (8%) respectively.

The document said that from 2014-15 fiscal to 2018-19 fiscal the allocation for public expenditure in product and service was near about 8%.

Due to various government steps, like enhancement of transparency through introducing E-GP, development in public procurement management and others, the allocation for this sector can be delineated in the government budget process, the document said.

Meanwhile, amid the coronavirus crisis, the government is working according to what it believes to be "a comprehensive plan" with four main strategies.

The four-pronged strategy entails discouraging luxury expenditures, prioritizing government spending that creates jobs, creating loan facilities through commercial banks at subsidized interest rates for the affected industries and businesses, and finally expanding the coverage of the government's social safety net programs.

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