DHAKA, May 31, 2023 (BSS) - Finance Minister AHM Mustafa Kamal will place the national budget of over Taka 7.61 lakh crore for the next fiscal year (FY24) at the Jatiya Sangsad tomorrow with the main philosophy of turning Bangladesh into a happy-prosperous, developed ‘Smart Bangladesh’ by 2041.
This will be the country's 52nd budget and the 24th of the Awami League government in five terms.
This budget for FY24 will be the 5th consecutive budget of incumbent Finance Minister AHM Mustafa Kamal.
The budget is expected to be passed in parliament on June 26, a bit earlier than the usual tradition because of the holidays of Eid Ul Azha.
According to a press release of the Ministry of Finance, the attainments of Bangladesh over the last one and a half decades under the Awami League government, have laid a solid foundation stone or sustainable groundwork for the country in the coming days.
The ‘Smart Bangladesh’ concept is based on four main pillars which are smart citizens, smart government, smart society and smart economy. “The budget for the next fiscal year (FY24) will be the first budget towards building ‘Smart Bangladesh’,” added the release.
This budget will prioritize health, agriculture, food production and management side by side there will be various food-friendly programmes throughout the year. Besides, the coverage of the social safety nets will also be increased.
The possible budget size of Taka 7,61,785 crore would mainly aim at taming inflation alongside the higher GDP growth trajectory, said a Finance Ministry official.
The budget size is likely to be Taka 1,01,278 crore higher than the revised budget of Taka 6,60,507 crore in the outgoing fiscal year.
The official also said that the budget would not be ambitious one nor expansionary.
The Finance Minister is set to deliver his budget speech with a possible title “Unnayoner Dirgho Agrojattra Periye Smart Bangladesher Abhimukhe.” The budget speech will feature 11 chapters.
Finance ministry officials said Kamal would present his vision on how to make a ‘Smart Bangladesh’ in his upcoming budget speech. The speech will cover building a smart country to cope with the 4iR.
The government this time is eying to attain a growth rate of 7.5 percent in the next fiscal year (FY24) while to contain the inflation rate around 6.5 percent. The total investment target in the next year will be 33.8 percent of the GDP.
The provisional estimate of Bangladesh Bureau of Statistics (BBS) shows that the GDP has grown by 6.03 percent in the outgoing fiscal year (FY23) and the inflation rate was 8.4 percent till April.
The budget speech has been prepared with emphasis on ensuring people’s employment through business expansion. The government will take initiatives to increase the investment of state-owned enterprises to create new jobs.
In his budget speech, the finance minister will reassure the countrymen about improving the country and transforming it into a smart one with visions to make smart roads to smart intellectuals.
Particularly, focus will be on the ICT sector, power sector, and making smart citizens.
The next budget will be 12.34 percent bigger than the current one.
It will be 15.21 percent of the projected GDP of Taka 50,06,682 crore, compared to 15.27 percent in the current fiscal year. This shows that the next budget is not ambitious.
Officials said the government targets a possible revenue collection of Taka 5,03,900 crore, around Taka 67,000 crore more than that in FY23.
Out of the overall revenue collection target, the NBR is likely to be tasked with a revenue collection target of Taka 4,30,000 crore while Taka 20,000 crore is likely to come from the non-NBR sources. Besides, the budget also eyes to collect Taka 50,000 crore as non-tax revenue.
The government has already approved a Taka 2.63 lakh crore Annual Development Programme (ADP) for the next fiscal year (FY24) of which Taka 1.69 lakh crore (64.26%) will come from the local sources while the rest of Taka 94,000 crore (35.74%) will come from the foreign sources.
Considering the allocations against the autonomous bodies and corporations, the overall estimated development expenditure in the next fiscal year would stand at Taka 2,77,582 crore.
Out of the major expenditure, Taka 4,75,281 crore will likely to be kept as operating cost of which Taka 94,376 crore will be spent for interest payment, Taka 39,034 crore as capital expenditure.
Besides, the government also plans to spend Taka 80,000 crore for bearing the salaries and expenses of the public servants, Taka 1.10 lakh crore for subsidies, and Taka 1,26,272 crore for the social safety nets.
Finance Ministry officials hoped that an amount of Taka 1,27,190 crore would be available as foreign loan alongside Taka 3,900 crore as foreign grants. The target for realizing net foreign loan in the outgoing fiscal year was Taka 95,458 crore.
The government will also likely to borrow Taka 1,32,395 crore from the banking sector in the next budget to meet the deficit financing of which most of the amount will be short-term loan. The target for borrowing from the banking sector in the current fiscal year was Taka 1,06,334 crore.
The target for realizing net loan from the savings certificates in the next budget is likely to be set at Taka 18,000 crore which was Taka 35,000 crore in the original budget of the current fiscal year. This target has been downsized since there is a downtrend in the sales of savings certificates.
The overall size of the Gross Domestic Product (GDP) in the next fiscal year is likely to be set at Taka 50,06,682 crore which was Taka 44,39,273 crore in the revised budget of the outgoing fiscal year.
The overall deficit in the next budget is likely to be Taka 2,61,785 crore, which is 5.2 percent of the GDP.
To meet the deficit, the government plans to borrow Taka 1,55,395 crore from domestic sources, including Taka 1,32,395 crore from the banking system.
Higher allocations will be made for subsidies, more than Taka 1.10 lakh crore, and for interest payments, around Taka 1.02 lakh crore. In the current fiscal year, the allocation for subsidies was around Taka 81,000 crore and for interest payment around Taka 80,000 crore.
The allocations are being raised to soften the blows of high prices of commodities in the international market and the depreciation of Taka.
The government will also likely to continue the austerity measures in the next fiscal year to reduce pressure on foreign reserves.
To achieve the revenue collection goal, several measures, including recruitment of private agents across the country, have been taken to increase the number of taxpayers.
The finance minister will also announce the increase in the allocation and number of beneficiaries in the social security sector following instructions of the prime minister.
The Finance Ministry release said to make the budget more participatory, all the budget-related documents will be available on the website of the Finance Division www.mof.gov.bd.
Any individual or organization would be able to download it and thus could send their valuable opinions and suggestions while staying from both home and abroad by filling up the feedback form on this website.
All the available opinions and recommendations would be considered and thus the accepted recommendations would be implemented during the passing of the budget by Jatiya Sangsad or after that period.
To ensure wide-scale participation, the budget documents will be available at the following government websites:
Meanwhile, the post-budget press conference will be held on Friday at 3:00 pm at the Bangabandhu International Conference Center (BICC) in the capital.