BUILD worried over budget deficit amid revenue collection struggles

The proposed budget deficit is above 6 per cent of GDP amounting to Tk 2.11 trillion, which may reach to 8 per cent as the revenue collection has been showing slow trend in pandemic period, according to BUILD, a business development platform, in its budget reaction.

The Business Initiative Leading Development (BUILD) thinks the deficit will mainly be filled taking loan from the banking sector and foreign loan.

The dependence on foreign financing has been increased 162 per cent than previous fiscal which is “alarming”, it said.

The social safety net will be expanded, higher than the current fiscal. Government has given enough emphasis on health safety issues, which need proper implementation.

In terms of export diversification in Medical and Personal Protective Equipment (MPPE), extension of tax exemption benefits up to June 2022 may encourage export diversification in this sector, BUILD said.

On the other hand, it seems, sluggish investment will continue as uncertainty due to the Covid-19 pandemic remains, and private sector credit growth is still at a lower level (8.7 per cent), according to BUILD.