Editorial
A budget with many fronts
A test-case for implementation
THESE are our first impressions of the national budget 2009-10 etched in broad strokes to convey a sense of what the tenor and temper of the document are all about. More comprehensive and in-depth analysis of the budget with specific comments on its major aspects and directional thrusts will follow in the days to come.
By the admission of the vibrant and profusely experienced presenter, Finance Minister AMA Muhith, the budget is expansionary and ambitious. One can, however, see reasons for a large budget with revenue and development components easily out-striping anything we have known in this country. Two factors made the budget of the size it is: the high expectations of a welfare-orientation to the economy raised by the electoral manifesto of the AL government and the fallout of the global financial meltdown, the worse part of which being on the cards for the next six months.
The first agenda adopted by the AL-led Mohajote government was to stabilise prices of essentials at a tolerable level. The rate of inflation dropped from around 9 percent to 5.5 percent in April; it is estimated that point-to-point inflation will stabilise at around 7 percent during the new fiscal year. Food prices may have dropped but non-food prices have not. In fact, many a consumer item is now to cost more, the scope of taxation having been enlarged. Food security has received due attention.
Agriculture, pro-agriculture activities, agri-processing, small and cottage industries have been given utmost priority.
Subsidies to agriculture will come down from Tk 4285 crore to Tk 3600 crore-thanks to falling international prices. The budgetary deficit will be around 5 percent of the GDP of which 2 percent is to come from external sources and 3 percent from internal sources.
A heavy reliance is placed on private-public participation. The idea boils down to utilising idle money of the broad private sector basically in big infrastructure building projects. But potential private sector partners will look for good return on their money in a free market paradigm, a prospect that massive infrastructure building undertakings may not offer in immediate terms.
Some innovation has been shown in terms of taxation like anybody owning car must have a TIN number. But there are inequities in tax that honest businessmen have to pay while people with unearned incomes declaring themselves enjoy a rebate. Actually, the budget is silent over AL's promised crusade against corruption.
On power and energy, whereas the AL manifesto had aimed at generating 5000 megawatt of electricity by 2011 it has now been scaled down to 3000 megawatt by 2014. And annual target is put at 700 megawatt.
The allocation under social security head of the revenue budget is 15.2 percent and the allocations to human resource development and employment generation are way above those we have known so far. The gender balance in allocation is a definite improvement in the public expenditure pattern.
That no industry will be privatised without ensuring employment to the retrenched is good thinking.
The projects envisaged for one-stop health service to the retarded and the concern shown to acid victims is highly welcome. The deference shown to lifting the lot of minorities and indigenous community is another bright feature of the budget.
The budget is multi-faceted with a diversity of features; the big question now is: how far the institutional capacities will be in place and how much of party commitment and honesty will be brought to bear on the implementation process?
For all latest news, follow The Daily Star's Google News channel.
Comments