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Jatiyo Sangsad passes budget for 2020-21 FY

Jatiyo Sangsad passes budget for 2020-21 FY

The Jatiyo Sangsad today passed the Taka 5,68,000 crore national budget for the next fiscal year (2020-21) with a target of attaining 8.2 percent GDP growth through continuing the momentum of the economy with all required activities after tackling the impacts of the coronavirus (COVID-19) pandemic.

Finance Minister A H M Mustafa Kamal moved the Appropriations Bill, 2020 to the House today seeking a budgetary allocation of Tk 7,59,642.44 crore which was passed by voice vote.

The Finance Minister earlier dubbed the proposed budget as “Economic Transition and Pathway to Progress”.

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 grants.

Earlier, parliament rejected by voice vote a total of 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 Jatiyo 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, however, were allowed to participate in the discussion on Law Ministry and Health Ministry.

Later, Speaker Dr 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 Appropriations Bill was passed in parliament and they did not raise any voice against passing of the bill.

Finance Minister A H M Mustafa Kamal on Jun 11 placed a Tk 568,000 crore budget which also aims to contain inflation within 5.4 percent for the next fiscal overcoming all challenges and impacts of the COVID-19 global pandemic.

The total allocation for operating and other expenditures is estimated at Tk 3,62,855 crore, while the allocation for the annual development program (ADP) is Tk 2,05,145 crore.

The total budget size in the current fiscal year was earlier estimated at Tk 5,23,190 crore. In the revised budget, the expenditure was reduced by Tk 21,613 crore, and thus revised at Tk 5,01,577 crore.

Keeping in mind the realities at hand and planned reforms in revenue management, the government set the target of total revenue collection of Taka 3,78,000 crore in the next fiscal year (2020-21).

Out of this amount, Tk 3,30,000 crore will be collected through the NBR. Tax revenue from the non-NBR sources has been estimated at Tk 15,000 crore, while the non-tax revenue is estimated to be Tk 33,000 crore.

The overall budget deficit has been estimated at Tk 190,000 crore, which is 6 percent of GDP up from 5.0 percent in the last fiscal year. Out of the total deficit, Tk 80,017 crore will be financed by external sources, while Tk 1,09,983 crore from domestic sources of which Tk 84,983 crore will come from the banking system and Tk 25,000 crore from savings certificates and other non-bank sources.

The allocation or the social infrastructure sector in the proposed budget is Tk 1,55,536 crore, which is 27.38 percent of total allocation, of which, the allocation for human resource sector (education, health and other related sectors) is Tk 1,40,222 crore.

Besides, allocation proposed for the physical infrastructure sector is Tk 1,67,011 crore or 29.40 percent, in which Tk 69,553 crore will go to overall agricultural and rural development, Tk 61,435 crore to overall communications, and Tk 26,758 crore to power and energy. A total of Tk 1,40,265 crore has been proposed for general services, which is 24.69 percent of the total allocation.

An amount of Tk 36,610 crore has been allotted for public-private partnerships (PPP), financial assistance to different industries, subsidies and equity investments in nationalized corporations, banks, and financial institutions, which is 6.45 percent of the total allocation.

As per the ministry and division wise allocation, the Local Government Division received a proposed budgetary allocation of Tk 36,103 crore, followed by Tk 22,883 crore to the Health Services Division alongside Tk 6,362 crore to the Ministry of Health and Family Welfare, Tk 29,442 crore to the Road Transport and Highways Division, Tk 24,853 crore to the Power Division, Tk 15,442 crore to the Ministry of Agriculture, Tk 33,118 crore to Secondary and Higher Education Division, Tk 24,937 crore to the Ministry of Primary and Mass Education, Tk 34,842 crore to the Ministry of Defense.

In order to fulfill the emergency requirements, Tk 10,000 crore lump sum amount has been allocated to fight against COVID-19.

The government has allocated Tk 95,574 crore for the social safety net programmes, which is 16.83 percent of total budget and 3.01 percent of GDP in FY 2020-21. In the last year’s revised budget, the allocation was Tk 81,865 crore.

Earlier on Monday, the Jatiyo Sangsad passed the Finance Bill 2020 with some minor changes.