Kazi Zahidul Hasan :
The government plans to cut its subsidy spending by nearly Tk 9000 crore in the next budget aiming to increase funding on development projects and narrowing down budget deficit, official sources said.
The total subsidy bill could come down to around Tk24,000 crore from that of the current fiscal’s budgetary spending target of Tk32,854 crore, a senior Planning Commission official told The New Nation on Monday on condition of anonymity.
He said, fuel subsidies on the head of Bangladesh Petroleum Corporation would go nil in the next budget thanks to a halving of international oil prices, creating a room for the government to trim the subsidy spending.
“As per the primary estimation, the highest subsidy allocation would go to the head of Bangladesh Power Development Board (BPDB) to address probable increase in power purchase from the costly private sector plants,” he added.
He further said that subsidy for agro sector remain more or less same like the current fiscal’s target.
“Cut in subsidy bill to give the government more funds for budget spending. It would be diverted to the implementation of the mega development project,” he noted.
When asked, he said, the government is not going to cut the subsidy bill from the pressure of donor agencies, it is going to do so only to bring reforms in fiscal policy.
The main objective of the government to reduce spending on subsidies is to bring check and balance in its overall budgetary expenditure and implement more development projects, he said.
Responding to a question, he said, such spending cuts may evoke criticism from different quarters but the government must do so to introduce policy reforms to meet some other vital demands.
Earlier, Finance Minister AMA Muhith said that the government will keep subsidy at a reasonable level in the next fiscal. He said subsidy amount will not be more than 2 per cent of GDP in next fiscal year, but the donors always insist we are giving huge subsidies.
“They (donors) want to reduce the subsidy to zero,” finance minister said. The total subsidy was Tk37,399 crore in FY2012-13, Tk30,163 crore in 2011-12, Tk17,141 crore in 2010-11, Tk9,334 crore in 2009-10 and Tk10,546 crore in 2008-09.
