Dr. Md. Shairul Mashreque :
Budget this year announced by Finance Minster AMA Muhith at the fag end of his life has been exposed to the whirland of protest and criticism. In an attempt to raise income from increasing circumference of taxing without caring for mass economic sufferings and development of infrastructure this budget may well be termed as anti-people and anti-development. This is simply to bring things back to wrong gear to cause tremendous mass discontent. The popular government that continues to contribute conspicuously to infrastructural development especially in road, highways and railway keeping in mind vision 2021 should be circumspect while approving this controversial budget in the parliament.
This unrealistic budget, if passed in its present format without drastic modification, will adversely affect infrastructural development. In other words it will have anesthetic impact on investment on infrastructures through public private partnership (PPP).
In fact many a mega project registered a slow progress. Enormous fiscal constraints will disturb smart implementation process. And this budget if not revised through parliamentary deliberation is sure to become a stumbling block numbing the spirit of partnership in development. According to news reports:
Several large-scale infrastructure projects that are on the government’s priority list have failed to gain momentum despite big budgetary allocations. Of all the mega projects taken up by the government, only the Padma Bridge has made significant progress over the last year. Some of the projects have even failed to begin within the stipulated time. It is likely that the project costs will jump up when the actual construction begins. While announcing the current budget in June last year.
Finance Minister AMA Muhith said the government was putting emphasis on major infrastructure development, which would lead to market and business growth, increased food production as well as financial solvency.In that budget, the government highlighted 10 projects as fast track projects, to be monitored directly by the Prime Minister’s Office. Among them are the Padma Multipurpose Bridge, Dhaka’s Metro Rail, Payra Deep Sea Port, Sonadia Deep Sea Port, Padma Rail Link and Chittagong-Cox’s Bazar Rail Network. Around 40% of the construction work of the Padma Bridge has been completed. However, the rest of the projects have not progressed properly as per the allocation of 2016-17 fiscal budget. Economist Dr Mirza Azizul Islam said: “The mega infrastructure initiatives are obviously welcome and if they are done properly, they will boost GDP and bring about significant economic changes, moving us closer to a middle income country”But if any project faces delays, they will create problems for the government as well the public.As of December 2017, the Bridges Division has already spent Tk12,273 crore in the last three fiscal years for the bridge. However, this is less than the total allocation for the bridge in the last three budgets. In the current budget there is an allocation of Tk6,026 crore, but Bridges Division sources said it might be returning Tk1,352 crore of it.The construction work of the Padma Bridge, however, appears to be running smoothly. The government has put the highest priority on implementing the project at a cost of Tk28,793 crore.
This project aims to lay a total of 172km railway tracks between Dhaka and Khulna’s Mongla at a cost of Tk34,988 crore. It was launched in May 2016, but at its current speed, it is unlikely that it will end by 2022, its targeted deadline The authorities are at the moment doing land acquisition work in the alignment areas of Dhaka, Faridpur, Narayanganj, Munshiganj, Shariatpur and Madaripur. The project was allocated Tk4,102 crore for the current fiscal year. The project was approved in April 2016, aiming to connect Dhaka and Cox’s Bazar directly, and including further connectivity between Bangladesh and Myanmar through Gundun border. The 100km dual gauge single line at a cost of Tk18,304 crore by 2022 has only been implemented 2.2%.The main construction work of metro rail is yet to begin. The total project cost is Tk21,985 crore while only Tk915 crore was spent until September last year.
The latest figures say only 4% of the project has been implemented The government claims it is determined to implement the project within the planned schedule. Especially, connectivity between Uttara and Agargaon will be completed by 2019, it says. But even though the project was approved in 2012, depot construction work started in 2015.
Currently the implementing agency is moving underground utility service lines in Dhaka’s Mirpur area to make way for the metro. The Payra deep seaport project was approved by the government in 2015 with a cost of Tk1,128 crore. The government has allocated Tk200 crore in this budget, however the project has progressed a mere 3%. The project is expected to be completed by 2018.Monowar Ahmed, additional secretary of Economic Relations Division, told the Dhaka Tribune: “We have given directives to the relevant officials to implement the projects properly. There have been concerns about the issue. We have also provided a guideline to the department concerned. Hopefully, now the projects will gain speed.”
Fifteen percent vat, increasing supplementary excise duties and regulatory tax will have disastrous policy outcomes slowing down growth and resulting in non-implementation of public policies in construction sectors. So increasing the burden of expenditure on this sector will demotivate the potential investors. Also damaging is imposition of fifteen percent vat on per sq. feet in the sale of apartment. As a result the real estate may suffer a lot. The fixed income groups who might dream of having a flat will not be able to fulfill it. Please shun vat on real estate that continues to create housing facilities for the fixed income groups. Think to reduce vat on cement, rod, iron and other building materials. Lavish financial support on construction sector will turn out to be a zero sum game if 15 percent vet tends to mess up things. Our journey to vision 2021 should not be delayed and derailed!
(Dr. Md. Shairul Mashreque, Chittagong University)
