Drained out funds and decline in earning have led the government to start the meetings on revising the fiscal budget early this year.
A senior official of the Finance Division said with all government departments having exhausted their allocations, Finance Minister AMA Muhith wanted to revise the budget before the present government’s tenure ended on January 24, 2014.
To that end the government plans to hold the budget revision meeting 22 days before the normal time, but analysts believe that an early budget revision is not appropriate for an interim government.
Usually, the meeting is held on January 7-24, but Finance Division officials said this time the meeting with 65 ministries and divisions would be held from December 15 to January 14.
Earlier, at a meeting of the fiscal coordination council, the finance minister said: “We have no choice but to revise the current fiscal budget three months early as we fear economic indices may drop because of hartals.”
Usually, a fiscal year’s budget is revised in the middle of March, but now the government wants to do it before January 24 next year.
Dr Mirza Azizul Islam, former adviser to a caretaker government, said it would not be appropriate for the interim administration to revise the budget as the prime minister had declared that it would not make any policy decisions.
“The government suspended the Executive Committee of National Economic Council on Wednesday because it makes policy decisions,” he said.
The former adviser said the government usually made major policy decisions while revising a budget.
Zaid Bakht, research director of Bangladesh Institute of Development Studies, said the prolonged political deadlock would stagnate the country’s economic activities and revenue earning while the growth and employment would also be affected.
National Board of Revenue Chairman Ghulam Hussain said hartals and blockades severally hampered revenue earning in the past five months, resulting in a revenue shortfall of Tk35bn.
“We will not maintain the 22% revenue growth in the current fiscal year. The board will calculate the total revenue shortage after December, he said.
The total expenditure in the FY2013-14 budget was estimated at Tk2.22 trillion, but the revenue earning stands at Tk1.67tr with a deficit of Tk550bn. Bank borrowing is estimated at Tk259.93bn.
Meanwhile, the World Bank, the International Monetary Fund, and the Asian Development Bank expressed concerns that the impending street agitation in the run-up to the national elections would take a heavy toll on Bangladesh’s economy and its growth.
They estimated that the country’s GDP would remain below 6% in the current fiscal year although the finance ministry expected it to grow to 6.6% compared to 6.3% of the previous fiscal year.
The government has a budgetary target of achieving 7.2% GDP growth in the current fiscal year.
