Rejaul Karim Byron

Amid a cost of living crisis, providing cash support to the poor and endeavouring to tame inflation would be the logical actions. But the government is not toeing that line.

The government’s bid to pay off Russia’s dues -- of about $330 million -- for the Rooppur power plant using the Chinese yuan has run into fresh complications after the last round of sanctions by the US on Russia.

The government is set to form the National Pension Authority (NPA) to execute the Universal Pension Scheme formulated to provide pension services for the common people.

About $1 billion in budget support is set to arrive in the next few days from three development partners to help the government meet its deficit financing for this fiscal year.

One of the consequences of years of economic mismanagement is the dramatic depreciation of the taka against the dollar in recent times, and its fallout will spill over into the medium term markedly, said a finance division study.

On paper, Tk 126,272 crore, the amount earmarked for social safety net programmes, looks to be a hefty sum. But the sum flatters to deceive: as much as 60 percent would be going towards those not in dire need.

Finance Minister AHM Mustafa Kamal yesterday said that though he is worried about the elevated level of consumer prices, the situation is still under the government’s control.

Though higher default loans and declining foreign currency reserves have been identified as the biggest risks to the economy of Bangladesh in recent times, Finance Minister AHM Mustafa Kamal yesterday fell short of coming up with any definitive measure to address the twin issues save offering some words of hope. 

The proposed budget for 2023-24 is unrealistic and unattainable as the challenges that caused the economic growth to decelerate, foreign exchange reserves to dip and inflation to surge in the past one year still persist, said economists and think-tanks.  

The government’s foreign debt servicing burden may rise by as much as 45 percent in the next fiscal year due to the devaluation of taka and higher utilisation of foreign loans in recent years.

Says economist Zahid Hussain 

In June last year when Finance Minister AHM Mustafa Kamal placed the budget in parliament, inflation had already been creeping up and the foreign currency reserves were on the decline. These two had derailed the full economic recovery from a two-year crisis wrought by the Covid pandemic.

The health ministry continues to struggle with utilisation of funds allocated in the national budget, like it did in the past few years.

The allocation for subsidies in agriculture, food, and power will be raised considerably in the next budget, with an aim to ease inflationary pressure on people.

Sustaining the development that has taken place in Bangladesh in the past 14 years and curbing inequality are key major challenges facing the economy owing to the fallout of the coronavirus pandemic and the Russia-Ukraine war, said Planning Minister MA Mannan.

The government is going to unveil a Tk 7,61,785 crore budget for the next fiscal year on Thursday, setting containment of high inflation as a major target.

The government’s target for borrowing from the banking system in the next fiscal year is set to surpass the Tk 1 lakh crore mark for the second consecutive year amid the twin difficulties of raging inflation and shrinking foreign reserves.

Even though poor people are struggling to make ends meet amid runaway inflation, the government allocation for social safety net programmes may not increase much in the next fiscal year.

Bangladesh loses around $3.3 billion a year due to unreliable power supply to homes, offices, and factories.

The private investment-to-GDP ratio in Bangladesh declined in the current fiscal year owing to a lower confidence among investors amid the persisting dollar crisis and global uncertainty, higher inflation and a fall in demand for goods in international markets.