Economic Reporter :
The government has borrowed more than Tk 7,000 crore from banking sector in the first quarter (July to September) this fiscal 2015.
According to a senior BB official, the government has taken the loan from the banking sector to clear a backlog of development projects cheques of last fiscal year.
In the first quarter, only 6.7 per cent of the total Annual Development Project (ADP) allocation was spent, which is the lowest in four years.
This fiscal year, the budget deficit is estimated to be Tk 86,657 crore, which is 5 per cent of the country’s gross domestic product. The deficit is to be met by borrowing from foreign and local sources.
“The government should have to look into the matter how the loans from the banking system would be used,” said AB Mirza Azizul Islam, finance adviser to a caretaker government.
He said if the May-June syndrome hits the implementation of development projects, it will cast a negative impact on the progress of works.
Mirza Azizul Islam sees the government borrowing from the country’s banking sector “a good thing” as the banks have huge amounts of idle money.
The government plans to borrow Tk 38,300 crore from the banking sector with a view to narrowing the budget deficit for the fiscal 2015-16.
