JS passes budget for 2020-21 FY

Finance minister AHM Mustafa Kamal placing the national budget for the 2020-21 fiscal in the Jatiya SangsadPID

National budget of Tk 5680 billion for the fiscal year 2020-21 has been passed in Jatiya Sangsad, with the slogan ‘Economic Transition and Pathway to Progress’ on Tuesday.

Finance minister AHM Mustafa Kamal moved the Appropriations Bill, 2020 seeking a budgetary allocation of Tk 7,596.42 billion which was passed by voice vote.

Following the proposal mooted in the House by the finance ministry for the parliamentary approval of appropriation of fund for meeting necessary development and non-development expenditures of the government, the ministers concerned placed justifications for the expenditures by their respective ministries through 59 demands for grant.

Earlier, Parliament rejected by voice vote a total of only 421 cut-motions that stood in the name of opposition members on 59 demands for grants for different ministries.

A total of nine MPs from Jatiya Party and BNP submitted their cut-motions on the budget. They are Kazi Firoze Rashid, Mujibul Huq, Fakhrul Imam, Pir Fazlur Rahman, Shamim Haider Patwari, Liaquat Hossain Khoka, Begum Rawshan Ara Mannan, Harun Ur Rashid and Rumeen Farhana.

They were, however, allowed to participate in the discussion on Law Ministry and Health Ministry.

Later, speaker Shirin Sharmin Chaudhury applied guillotine to quicken the process of passing the demands for grants for different ministries without giving the lunch break.

Opposition and independent MPs were present at the House when the Appropriation Bill was passed in Parliament and they did not raise any voice against passing of the bill.

Finance minister AHM Mustafa Kamal on 11 June placed a Tk 5680 billion to attain an ambitious 8.2 per cent GDP, which has been revised to 5.2 per cent in line with maintaining a 5.4 per cent inflation for the next fiscal overcoming all the challenges and impacts of the COVID-19 global pandemic.

The total allocation for operating and other expenditures is estimated at Tk 3,628.55 billion, while the allocation for the annual development programme (ADP) is Tk 2,051.45 billion.

The total budget size in the current fiscal year was earlier estimated at Tk 5231.90 billion. In the revised budget, the expenditure was reduced by Tk 216.13 billion, and thus revised at Tk 5,015.77 billion.

Keeping in mind the realities and planned reforms in revenue management, the government set the target of total revenue income in the fiscal year 2020-21 at Tk 3,780 billion.

Out of this, Tk 3,300 billion will be collected through the NBR. Tax revenue from non-NBR sources has been estimated at Tk 150 billion, while the non-tax revenue at Tk 330 billion, he continued.

The overall budget deficit has been estimated at Tk 1900 billion, which is 6 per cent of GDP, up from 5.0 per cent in the last fiscal year. Out of the total deficit, Tk 800.17 billion will be financed from external sources, while Tk 1,099.83 billion from domestic sources of which Tk 849.83 billion will come from the banking system and Tk 250 billion from savings certificates and other non-bank sources.

For the social infrastructure sector in the proposed budget is Tk 1,555.36 billion, which is 27.38 per cent of total allocation, in which allocation for human resource sector (education, health and other related sectors) will be Tk 1,402.22 billion.

Besides, the allocation proposed for the physical infrastructure sector will be Tk 1,670.11 billion or 29.40 per cent, in which Tk 695.53 billion will go to overall agricultural and rural development, Tk 614.35 billion to overall communications, and Tk 267.58 billion to power and energy. A total of Tk 1,402.65 billion has been proposed for general services, which is 24.69 per cent of the total allocation.

An amount of Tk 366.10 billion has been allotted for public-private partnership (PPP), financial assistance to different industries, subsidies and equity investments in nationalised corporations, banks, and financial institutions, which is 6.45 per cent of the total allocation.

To fulfill emergency requirements, a Tk 100 billion lump sum amount has been allotted to fight COVID-19.

The government has allocated Tk 955.74 billion for the social safety net programmes, which is 16.83 per cent of the total budget and 3.01 per cent of GDP in FY 2020-21. In last year’s revised budget, the allocation was Tk 818.65 billion.

Earlier on Monday, Parliament passed the Finance Bill 2020 with some changes.