Flat construction, beautification projects also on govt priority list

There are three abandoned buildings in the Gulshan and Banani areas of the capital. These buildings are to be demolished for the construction of high-rise residences of government officials.

A proposal for this project worth Tk 2.17 billion has been prepared. The deadline for the project ends December 2026.

A residence for the Bangladesh ambassador to Egypt will be constructed in Cairo. The estimated cost for this project is Tk 1.65 billion. The cost of the project to construct sculptures, colourful lamp posts and foot over-bridges for the beautification of the Cox’s Bazar city is estimated at Tk 240 million. Both projects will end by December 2025.

Such less important projects have been included in the Annual Development Plan (ADP) as unapproved projects. However, the government is considering these as high priority projects. However, the economists have questioned the government decision to prioritise on such less important projects when the country’s economy is going through a tough time due to the prevailing dollar crisis.

The government has included a total of 766 new projects in the ADP to be implemented with its own fund. The projects will be approved gradually throughout the next fiscal in accordance with the list. Of these, the government has given 'high' priority to 682 projects. Of the remaining, 82 are termed as medium priority projects and 14 are low priority projects.

Usually, more than 1,000 projects from the previous fiscal are still running when the ADP gets approved. The new projects are added to this list as unapproved new projects.

There is a pressure from the International Monetary Fund (IMF) to curb costs such as subsidies. The international agency also recommended keeping the budget small to reduce deficits. The revenue collection is not as per the expectations. Unable to pay the money of the subsidy for power and fertilisers, the government has to pay in bonds worth billions.

A large part of the budget will come from loans. Analysing the income and expenditure of the budget, it has been learnt that the entire money for the ADP will come from foreign and domestic loans.

There are several other less important projects in the list of projects to be implemented with money from domestic sources. The project for the feasibility studies on the construction of the connecting bridge between Nijhum Dwip and the mainland will cost Tk 150 million. Besides, the government also wants to construct the Uchitpur-Khaliajuri flyover in Netrakona. A Tk 120-million-project to carry out a feasibility study for the flyover is in the government's list of top priority projects.

Apart from that, the projects to construct a building for the Karmasangsthan Bank at a cost of Tk 2.7 billion and the Tant Board Complex in the capital’s Mirpur are also in the government’s priority list. The list also includes a project for constructing circuit houses in different districts, including Dhaka, Chattogram, Rajshahi, Barishal, Gazipur and Faridpur. Most of the unapproved new projects in the ADP are related to construction of buildings and roads.

Speaking to Prothom Alo, former secretary Muhammad Fouzul Kabir Khan said, “We are in an economic crisis. Our revenue collection is not as per the expectations. In this context, such projects simply cannot get high priority. What are the aims of these projects? We should prioritise projects that would enhance our production.”

He further said, “Such construction projects could be taken during good times, when we have enough money and the economy is in a healthy state. It would not be that much of a problem, if the circuit houses are not constructed right now. The same goes for the flats to be constructed for the government officials.”

Most of the economic indicators are downward at the moment due to different sorts of crises. In this context, the government is going to declare the budget for the new fiscal in the parliament on 6 June. Already the ADP worth Tk 2.65 trillion has been approved at the National Economic Council (NEC). There are a total of 1,321 projects in the new ADP.

The size of ADP for the next fiscal could not be enhanced that much mainly due to the monetary crisis.  The size of the ADP has risen by only Tk 20 billion as compared to the actual ADP last year. The allocation in local currency in the ADP has been reduced. A total of Tk 1.65 trillion will come from local sources for the ADP, which is Tk 1.69 trillion in the current fiscal. The government will get Tk 1 trillion as project assistance from foreign sources in the ADP, which is Tk 60 billion more than the current fiscal. This is the first time that the aimed foreign assistance crossed Tk 1 trillion in the budget. The government is depending on foreign assistance due to the decline in the supply of money from local sources.

Speaking regarding the shrinking ADP, Muhammad Fouzul Kabir Khan said, “The main reason behind this is our inability to collect revenue at the desired rate. As a result, not only the size of ADP cannot be increased, but also the allocation in local currency has to be reduced compared to the previous year.”

The experts say the government doesn’t have enough financial accords at the moment to increase the size of the ADP. The growth in the revenue collection is remaining between 10-12 per cent. The efforts to increase revenue collection are yielding expected outcomes. The government is also struggling to clear the debts for not having enough money in their hands.

Speaking to Prothom Alo, Selim Raihan, executive director of South Asian Network on Economic Modeling (SANEM) said, “Approval of such lavish projects amidst an economic crisis is not acceptable at all. We are surprised to see such projects getting approval when we are being told to maintain austerity from the highest level of the government. These sorts of projects must be omitted from the budget proposals.”

Although the government took up several less important projects in the development sector, it hasn’t put much emphasis on education and health. Like every time, the government has prioritised more on the allocation for road construction and the energy sector this time too. The education and health sector are not among the top three sectors in the ADP for the upcoming fiscal.

The top three sectors in the ADP for the upcoming fiscal are - the local government division, road transport and highways department and the Power Division. These three sectors are getting almost 40 per cent of the total allocation in the ADP. These ministries usually took up projects for public contentment, projects which are easily visible to the eyes of the common people. However, the total allocation for education and health covers less than 20 per cent of the ADP. The top five projects in the ADP have got allocation of a total of Tk 353.54 billion, which is almost 13 per cent of the total ADP.

The idea of public-private partnership was first introduced in the budget for the 2009-10 fiscal. However, this project hasn’t seen much success over the last one and a half decades. The elevated expressway from the Airport to Karwan Bazar in the capital is the most notable achievement under this project.

The PPP sector gets allotment every year. The ADP also contains 70-80 PPP projects every year. But there hasn’t been any fruitful outcome. The allocated money remains unused in most cases. There are some 79 PPP projects in the upcoming fiscals as well.

These projects would be implemented only if the government gets private investment for this, relevant officials said.

* This report appeared on the print and online versions of Prothom Alo and has been rewritten in English by Ashish Basu