Dhaka, June 2: Finance Minister AMA Muhith on Thursday placed Tk 3,40,605 crore budget with a huge deficit of Tk 97,853 crore for the 2016-17 fiscal year in Parliament.
This is the largest in the history of Bangladesh. The Finance Minister termed it as ambitious budget.
A cabinet division meeting chaired by Prime Minister Sheikh Hasina was held on Thursday at the Jatiya Sangshad and approved the fiscal bill for placing before the parliament.
Finance minister AMA Muhith and other ministers were present in the meeting. After the cabinet passed the bill, President Abdul Hamid signed the bill and sent it to the parliament secretariat for presenting before the house.
The finance minister started budget speech at about 3:30pm with Speaker Shirin Sharmin Chaudhury in the chair.
This is the country’s 45th national budget while the 17th budget of the Awami League government and the 10th for Muhith.
The revenue collection target for the next fiscal year has been set at Tk 2,42,752crore, which is 12.4% of GDP, of which NBR tax revenue is Tk 2,03,152 crore. Revenue from Non-NBR sources has been estimated at Tk 7,250% crore. In addition, Tk 32,350 crore will be collected as Non-Tax Revenue.
Annual Development Programme (ADP)
Tk 93,895 crore has been allocated to the revised Annual Development Programme (ADP), which is 27.57 per cent of total budget, and Tk 2,895 crore more than the revised budget for 2015-16 FY.
In the proposed budget for ADP, 24.6% has been allotted in human resource development sector i.e. education, health, and others; 24.5% in overall agro sector; 13.5% in power, and electricity; 25.8% in communications sector; and 11.6% has been allocated in other sectors.
The budget deficit for the next fiscal year is Tk 97,853 crore, which is 5% of total GDP. Tk 36,305 crore or 1.9% of the budget will be drawn from the foreign sources, and Tk 22,610 crore or 1.1% will be collected from non-bank borrowing. Bank borrowing is Tk 38,938 crore, which is 2% of GDP
In the 2016-17 fiscal year’s budget, primarily it is mentioned that Tk 36,305 crore will be collected from external sources. However, in the revised budget plan of 2015-16 FY it was mentioned Tk 24,990 crore.
Since the proposed budget for FY 2016-17 is a lofty one, enough money may not be available from foreign sources. In that case, government will have to rely on the commercial banks to balance the deficit budget. Independent entrepreneurs will receive fewer loans. Since the government will have to borrow money from Bangladesh Bank, that will increase the inflation.