Budget of 2024-25: ADP size to increase by a mere Tk 20b

The size of the annual development programme (ADP) of the coming national budget of 2024-25 financial year will be Tk 2.65 trillion, up by only Tk 20 billion from the ADP of the ongoing 2023-24 financial year, due to the financial crisis. In percentage point, the growth rate is less than 1 per cent.

The allocation in the ADP of the coming budget in local currency will decline by Tk 40 billion. The amount of allocation from local sources will be Tk 1.65 trillion which was Tk 1.69 trillion in this fiscal’s budget. This would mark the first incident of decline in ADP allocation in local currency.

Apart from this, for the first time, the target of foreign assistance in ADP would touch Tk 1 trillion. The amount was Tk 940 billion in the ongoing fiscal.

The draft of the ADP of the next fiscal year was finalised from an extended meeting of the planning ministry, with planning minister Abdus Salam in chair, on Tuesday. The draft is likely to get clearance from the National Economic Council (NEC) meeting on 16 May.

Speaking about the ADP size in the next budget, mega-infrastructure expert and former secretary Muhammad Fouzul Kabir Khan told Prothom Alo that the revenue collection is not up to the expected level at this time of the economy. That is why the ADP size could not be enlarged. Not only this, the allocation in ADP in local currency has been slashed.

The government does not have the financial capacity to increase the ADP size, said relevant people. The revenue collection remains limited within 10-12 per cent.

Speaking at a programme in April, Debapriya Bhattacharya, distinguished fellow at non-government think tank Centre for Policy Dialogue (CPD), said, “We cannot pay a single penny from the revenue budget to development projects. So many mega projects are being implemented taking loans, but this does not have any reflection in the education, health and other socio-economic development. We have done so many things but why have the people not gotten any benefit?”

He further said, “Even today we could not increase the allocation in education budget and in the health sector more than 2 and 1 per cent of the GDP respectively.”

Road transport, and power and fuel will get most importance in the coming budget while the allocation in ADP in health and education sectors will not see any significant spike. The allocation in the road transport, and power and fuel will get more than the amount planned in the 8th five year plan. Though the health and education sectors are two prioritised sectors of the government, those two sectors will receive less allocation than the amount mentioned in the 8th five year plan.

The transport and communication sector is getting the maximum allocation of 27 per cent (Tk 706.87 billion) in the next ADP. In the five year plan, this sector was supposed to receive an allocation of 17 per cent of the ADP next year. Power and energy sector is getting Tk 407.51 billion, which is 15 per cent of the total ADP.

In the proposed ADP for 2024-25FY, the allocation for the education sector is Tk 315.28 billion or about 12 per cent of the total ADP though the 8th five year plan spoke about granting an allocation of 16.5 per cent of the total ADP.

On the other hand, in the 8th five-year plan, 11 per cent of the total ADP is supposed to be allocated to the health sector, but the sector is receiving only 7.8 per cent (Tk 206.82 billion) in the next ADP.

According to the planning ministry sources, roughly 15 sectors are getting more than 96 per cent allocation in the next ADP. Apart from the transport and communication, power and fuel, education, and health sectors, housing sector is likely to receive an allocation of Tk 248.36 billion, the local government and rural development will get Tk 179.86 billion, environment, climate change and water resources sector is getting allocation of Tk 110.89 billion, and the agriculture sector is receiving Tk 132.19 billion.