Editorial
The high-aiming ADP
Implementation is the issue here
THE government has announced a Taka 30,000 crore Annual Development Programme (ADP) for the 2009-10 fiscal triggering a spate of debate over its size which has been dubbed as ambitious by most economists.
The AL government could not possibly settle for any lower financial target despite the negative historical trend of underperforming ADPs, both in quality and volume, because of certain obvious compulsion. The government has its electoral pledges to fulfil based on its developmental philosophy and the compelling need to create jobs and augment domestic demand in a bid to cushion off the adverse ripple effects of global economic meltdown. As it is, ADP being an instrument through which public expenditure is madeand in our context it has been the lowest as percentage of GDP in the whole regionany tilt away from revenue expenditure is to be welcomed.
So, we are not per se critical of the new ADP's size, except to warn against government borrowing in the event of revenue collection shortfall that could bring in additional problems for economic management. Basically, we have questions about how prepared the government is to implement the ADP, precisely to avert a mismatch between fulfilment of physical targets and that of financial targets. The planning minister AK Khandker has stated that the ministries will be asked to start implementing the next ADP at the beginning of the financial year in tandem with arrangements made for timely release of project funds so that the implementation process is completed within schedule.
Yet, given the structural deficiencies in the implementation machinery and the long-winded procedures that go with these, it would take much more than mere intention or exhortation to move the juggernaut of implementation. Conservatively estimated, it would require at least 50 percent improvement in the capacity of our project implementation machinery in a single year to make any definite difference in the rate of project execution, according to the BIDS research director. Actually, there are two sets of bottlenecks that will have to be removed. In the first category fall delay in planning repeated amendment to a project, delay in approval or correction of the project and donors' conditions. The other hindrances range from procurement snags through land acquisition and litigation to lack of well-developed work plan and unstable project management.
The previous ADPs have largely floundered on the rock of governments using it as instrument of political patronisation and rent-seeking. Since the new ADP will shoulder the burden of a large number carry-over projects -- 851 to be precisein a reflected sense the AL government inherits the inadequacies of the past project portfolios. As for the 35 new projects, and 487 unapproved projects for which no allocations have been made the government will need to be extremely careful in implementing them.
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