Finance Minister AMA Muhith on Thursday proposed the biggest-ever national budget of Tk 400266 crore for the fiscal 2017-18 with an ambitious spending to attain 7.4 percent GDP growth.
This is Muhith’s 11th budget for the Awami League led government facing the next general election in early 2019. The proposed budget is Tk 59,661 crore bigger or 17.52 percent higher than the Tk 340,605 crore budget of the outgoing fiscal FY17.
Its revenue target of Tk 2,87,990 crore has left a deficit of Tk 1,12,276 crore to be funded from internal and external borrowing. It is something closer to one-fourth of the total budget that prompt many to question why the government is out stepping its ability to generate funds. Revenue expenditure for government establishments has been earmarked at Tk 2,41,253 crore while allocations against Annual Development Programme (ADP) has been proposed at Tk 1,53,331 crore.
The National Board of Revenue (NBR) will generate Tk.2,48,190 crore. It will mainly use the 15 percent VAT to achieve the targets, in addition to doubling of excise duty on bank accounts, sales of air tickets and increasing supplementary duty and surcharge on most consumer goods, services and raw materials.
The budget appears to hit common people at their worst, as most kitchen items will see significant rise in duties. Critics have openly termed the budget as a cruel instrument in the hands of the government to collect money to maintain a highly expensive regime. Spending on high profile development activities and politically motivated projects figured out prominently in this budget. Extortion of people’s money is the main consideration.
Prof Wahiduddin Mahmud has rightly said this is an ambitious, populist budget with eyes on election. We disagree with him on the point that the government needs to do anything to please the people. The victory in the election will be ensured by corrupt bureaucrats. Others sounded similar views saying it is time to take up big expenditure projects to hide corruption.
Former Finance Adviser of the caretaker government A.B. Mirza Azizul Islam’s view is that the country’s economic situation is not good to generate so much revenue and it is not affordable for the government either.
He said that the government has to cut the outgoing budget from Tk 3 lakhs 40 thousand crore to 3 lakh 17 thousand crore leaving a unattained deficit of Tk 23 thousand crore.
To Mr. Aziz it appears that implementation of the ADP is increasingly facing setbacks over the past years at a time when the bigger part of the revenue is going to finance government establishments that include higher pay and salary of bureaucrats, Ministers, MPs and leaders of elected bodies.
Like politics the country’s economy is run for the one sided benefit of a class of people proving helpful to the government.
Former Governor of Bangladesh Bank Dr Salehuddin Ahmed said budget is now the engine of mobilizing more revenue for the government to enjoy luxurious life, public procurements have become expensive and source of money laundering. Lots of money is going to unnecessary foreign tours of government leaders and bureaucrats.
Contrary to it there is no credible move to create encouragement for investment and job creation for the young unemployed millions.
The Centre for Policy Dialogue said that the higher economic growth in recent years has not translated into employment generation. Releasing a report on the State of the Bangladesh Economy in FY16 last week it said higher level of GDP growth rates did not create adequate employment in the country. The space of job creation slowed down considerably during 2013-2015 periods.
The budget given is bureaucratic but with political imagination.
This is Muhith’s 11th budget for the Awami League led government facing the next general election in early 2019. The proposed budget is Tk 59,661 crore bigger or 17.52 percent higher than the Tk 340,605 crore budget of the outgoing fiscal FY17.
Its revenue target of Tk 2,87,990 crore has left a deficit of Tk 1,12,276 crore to be funded from internal and external borrowing. It is something closer to one-fourth of the total budget that prompt many to question why the government is out stepping its ability to generate funds. Revenue expenditure for government establishments has been earmarked at Tk 2,41,253 crore while allocations against Annual Development Programme (ADP) has been proposed at Tk 1,53,331 crore.
The National Board of Revenue (NBR) will generate Tk.2,48,190 crore. It will mainly use the 15 percent VAT to achieve the targets, in addition to doubling of excise duty on bank accounts, sales of air tickets and increasing supplementary duty and surcharge on most consumer goods, services and raw materials.
The budget appears to hit common people at their worst, as most kitchen items will see significant rise in duties. Critics have openly termed the budget as a cruel instrument in the hands of the government to collect money to maintain a highly expensive regime. Spending on high profile development activities and politically motivated projects figured out prominently in this budget. Extortion of people’s money is the main consideration.
Prof Wahiduddin Mahmud has rightly said this is an ambitious, populist budget with eyes on election. We disagree with him on the point that the government needs to do anything to please the people. The victory in the election will be ensured by corrupt bureaucrats. Others sounded similar views saying it is time to take up big expenditure projects to hide corruption.
Former Finance Adviser of the caretaker government A.B. Mirza Azizul Islam’s view is that the country’s economic situation is not good to generate so much revenue and it is not affordable for the government either.
He said that the government has to cut the outgoing budget from Tk 3 lakhs 40 thousand crore to 3 lakh 17 thousand crore leaving a unattained deficit of Tk 23 thousand crore.
To Mr. Aziz it appears that implementation of the ADP is increasingly facing setbacks over the past years at a time when the bigger part of the revenue is going to finance government establishments that include higher pay and salary of bureaucrats, Ministers, MPs and leaders of elected bodies.
Like politics the country’s economy is run for the one sided benefit of a class of people proving helpful to the government.
Former Governor of Bangladesh Bank Dr Salehuddin Ahmed said budget is now the engine of mobilizing more revenue for the government to enjoy luxurious life, public procurements have become expensive and source of money laundering. Lots of money is going to unnecessary foreign tours of government leaders and bureaucrats.
Contrary to it there is no credible move to create encouragement for investment and job creation for the young unemployed millions.
The Centre for Policy Dialogue said that the higher economic growth in recent years has not translated into employment generation. Releasing a report on the State of the Bangladesh Economy in FY16 last week it said higher level of GDP growth rates did not create adequate employment in the country. The space of job creation slowed down considerably during 2013-2015 periods.
The budget given is bureaucratic but with political imagination.
