The government has allocated Tk260bn for bank borrowing – which is 13% higher than that of the previous fiscal year – to meet the deficit in the proposed budget for FY2013-14.
While presenting the budget in parliament Thursday, Finance Minister AMA Muhith said the overall budget deficit would be Tk550.32bn, which is 4.6% of the GDP.
Of the amount, Tk210.68bn (1.8% of the GDP) will be financed from external sources and Tk339.64bn (2.9% of the GDP) from domestic sources. Of the domestic financing Tk259.93bn will come from the banking system and Tk79.71bn from savings certificates and other non-banking sources.
The government is likely to borrow Tk230bn in the current fiscal year which has been increased to Tk280bn in the revised budget.