Rejaul Karim Byron

The government has planned to increase foreign financing by around 15 percent and reduce bank borrowing by 28 percent in the revised budget for this fiscal year to tame inflation.

The planning ministry is now set to present the project proposal to the Ecnec for final approval.

The finance ministry is likely to project that the country’s gross domestic product (GDP) will surpass the $500-billion mark for the first time in the upcoming fiscal year (FY), anticipating an economic rebound in FY 2025-26.

The Asian Development Bank (ADB) has projected Bangladesh’s GDP growth rate to slow to 4.3 percent in fiscal year (FY) 2025, reflecting a subdued outlook amid political uncertainty, supply disruptions and tight monetary policy.

The interim government has revised its aim for foreign exchange reserves, saying it expects to have $28.6 billion by June this year, capitalising on strong growth in inward remittances, exports, and budgetary support from development partners.

The GDP growth target may be brought down to 5.25 percent in the revised budget for the current fiscal year due to the damage caused by multiple floods and the interim government’s contractionary monetary policy to contain high inflation.

The interim government must suspend the inefficient and costly power plants and renegotiate the capacity payment terms with the private power producers as the structure incentivises inefficiency, according to the report of the task force.

Social safety net programmes, such as Open Market Sales (OMS) and Vulnerable Group Feeding (VGF), provided less help to the actual poor, despite the government boasting about the impact of those schemes on reducing moderate and extreme poverty, according to a taskforce report.

The Asian Development Bank has agreed to provide up to $1 billion in budget support by June, but the government must commit to several terms that include reducing the tenure and number of private bank directors.

The initially estimated costs of these projects were $11.2 billion in total

The International Monetary Fund has set a prior condition for introducing a full 15 percent statutory VAT rate on 213 products before placing the $645 million loan proposal for the fourth tranche to its executive board.

Finance adviser talks about govt’s 3 strategies to ease economic strain

The interim government may consider a dearness allowance for lower-grade government staff to provide respite from the ongoing high inflation.

Subsidies for the power sector are likely to balloon 83 percent this fiscal year as the interim government is planning to clear all arrears owed to private power producers.

As much as $670 million (around Tk 8,200 crore) from slow-moving World Bank-funded projects will be repurposed, with most of the funds going towards budget support as the government looks to navigate the narrow fiscal space amid a slowing economy.

Over half of the government’s total revenue expenditure during the first four months of the current fiscal year of 2024–25 was on interest payments alone, mainly due to increased borrowing and a rise in the interest rates.

A task force formed by the planning ministry is going to recommend the formation of an independent centre for delivering government services via social media and utilising artificial intelligence (AI).

The interim government has increased interest rates on various national savings certificates to upwards of 12 percent in an effort to make these instruments more attractive to savers and to cool inflation.

The implementation of the Annual Development Programme (ADP) in the first six months of fiscal year 2024-25 was down 19 percent year-on-year, due mainly to political unrest and delay caused by thorough scrutiny of previously approved projects.

Tk 50,002 crore was spent in the period