THE country’s development partners are promising on an average around $6 billion in loans every year to Bangladesh over the last few years, but it has been able to spend only around 2.5 billion a year. The latest data released by the Economic Relations Division (ERD) of the government and reported by The New Nation on Friday indicate that by the end of fiscal 2014-15 the amount of promised foreign loan in pipeline was around $22 billion, the highest ever so far. Around $19.5 billion worth promised loans were in the pipeline until June 2014. Another $2.2 billion was added to that in the year until June 2015.
A senior government official believed that the size of the promised loans in the pipeline would come down if the government agencies (Ministries and Divisions) could spend at least 20 percent of its allocation made in the budget annually. Bangladesh’s largest source of foreign assistance is the World Bank (WB) but it has been able to disburse over 20 percent funds in the Bank funded projects..
Increasing project implementation capacity is a must in this situation if the promised loans to be fully utilized. As a developing nation Bangladesh is having many large infrastructural projects which need to be brought to fruition. The Padma Bridge, Dhaka-Chittagong highway extension, metro rail and more flyovers in the capital may be some very important projects in hands and the acceleration of their work can unlock the bottlenecks and negative externalities to put more pipeline resources to use and achieve higher growth.
To this Bangladesh may also add some major social infrastructure projects like hospitals, universities, and expanding tourists’ outlet throughout the country. More resources may also be put to use to power generation and its nationwide distribution. Coal production and gas exploration may also use excess resources to accelerate the GDP growth over 7 percent in the shortest possible time.
The obvious answer to unlock the government capacity to use more development assistance lies in enhancing the administrative and managerial capacity to handle more projects at a time and more efficiently to prepare and implement the projects within the stipulation time. We require too much time in project formulation when the availability of fund even expire on many occasion. Here more emphasis must go to creating highly efficient manpower by appropriate training. Corruption must be seriously dealt with and misuse of public resources must be shelved to remove the poor country perspective to the donors’ community.
Slow project implementation in many cases also result from slow disbursement of aid and that leads to time-and cost-overruns. The donors’ community always blames Bangladesh in this respect demanding improvement and it is suggested that the government must improve the institutional capacity at all levels to increase the national capacity to handle massive external loans for development.
A senior government official believed that the size of the promised loans in the pipeline would come down if the government agencies (Ministries and Divisions) could spend at least 20 percent of its allocation made in the budget annually. Bangladesh’s largest source of foreign assistance is the World Bank (WB) but it has been able to disburse over 20 percent funds in the Bank funded projects..
Increasing project implementation capacity is a must in this situation if the promised loans to be fully utilized. As a developing nation Bangladesh is having many large infrastructural projects which need to be brought to fruition. The Padma Bridge, Dhaka-Chittagong highway extension, metro rail and more flyovers in the capital may be some very important projects in hands and the acceleration of their work can unlock the bottlenecks and negative externalities to put more pipeline resources to use and achieve higher growth.
To this Bangladesh may also add some major social infrastructure projects like hospitals, universities, and expanding tourists’ outlet throughout the country. More resources may also be put to use to power generation and its nationwide distribution. Coal production and gas exploration may also use excess resources to accelerate the GDP growth over 7 percent in the shortest possible time.
The obvious answer to unlock the government capacity to use more development assistance lies in enhancing the administrative and managerial capacity to handle more projects at a time and more efficiently to prepare and implement the projects within the stipulation time. We require too much time in project formulation when the availability of fund even expire on many occasion. Here more emphasis must go to creating highly efficient manpower by appropriate training. Corruption must be seriously dealt with and misuse of public resources must be shelved to remove the poor country perspective to the donors’ community.
Slow project implementation in many cases also result from slow disbursement of aid and that leads to time-and cost-overruns. The donors’ community always blames Bangladesh in this respect demanding improvement and it is suggested that the government must improve the institutional capacity at all levels to increase the national capacity to handle massive external loans for development.
