The Local Government Division, which topped the Annual Development Programme (ADP) allocations for the current fiscal year, is set to face a reduction of Tk1,189.21 crore in the next fiscal year, while the Power Division, the second highest recipient in the current fiscal, will see a decrease of Tk6,263.75 crore in its allocation.
Allocations for 10 ministries and divisions, which rank among the top 15 recipients in the current fiscal, including the Road Transport and Highways Division, Ministry of Railways, Bridges Division, and Secondary and Higher Education Division, are set to be reduced, said sources at the Planning Ministry.
The proposal of the ADP for the fiscal year 2024-25, worth Tk2,65,000 crore with a breakdown of Tk1,65,000 crore from the own funds of the government and Tk1,00,000 crore from the external sector as loans and grants to be placed for the final approval of the National Economic Council (NEC).
Prime Minister Sheikh Hasnia is scheduled to preside over the NEC meeting to be held at the NEC conference centre of the capital on Thursday (16 May).
The NEC approved ADP worth Tk2,63,000 crore for the current fiscal year while Tk1,69,000 crore from the government exchequer and Tk94,000 crore from foreign sources.
The size of the ADP for the next fiscal will be increased by only Tk2,000 crore, mere 0.76% from the current fiscal year.
The commission proposed a decrease of Tk4,000 crore, about 2.37% from the current fiscal year from the government funds but proposed an increase of Tk6,000 crore, 6.38% higher from foreign sources.
Analysis of the Planning Commission's proposal reveals that the ongoing economic crisis, characterised by slow revenue collection, banking liquidity challenges, and a decline in foreign aid concessions, has hindered the allocation process in meeting the demands of ministries and divisions in the new ADP.
All of the implementing agencies placed demand worth Tk2,76,402.46 crore, but the Planning Commission finalised allocation of a lower amount which will make a shortage of Tk11,402.46 crore.
The Planning Commission proposed allocation Tk20,391.19 crore less than the combined demand of all of the ministries and divisions to avail from the domestic fund.
All of the ministries asked for Tk1,85,391 crore from the government and the commission managed to allocate only 89% of the demand.
Whatever, the Planning Commission would impose an allocation worth Tk8,988.73 crore from the external sector, out of the demand to the implementing agencies.
The commission wants to allocate a total of Tk1,00,000 crore, Tk8,988.73 crore higher than the requirement of Tk91,011.27 crore to all ministries and divisions from foreign aid.
The NEC cut down the ADP of the current fiscal year due to sluggish implementation and financial crisis and approved Revised ADP (RADP) worth Tk2,45,000 crore. The size of the next ADP to increase by Tk20,000 crore, about 8.16% comparing the RADP of the current fiscal.
Analysing the series data of the Implementation Monitoring and Evaluation Division (IMED) of the Planning Ministry, it found that the allocation from government exchequer reduced slightly in the fiscal year 2008-2009, when the economy was facing several types of financial crises in the caretaker government regime.
The IMED statistics claim that government allocation for development has never decreased in any year since independence.
Allocation for large agencies to decrease:
Tk38,808.88 crore is being allocated in the next financial for the Local Government Division which is at the top with allocation of Tk39,998 crore in the current fiscal.
Despite the increase in nine projects, the division’s allocation to reduce by Tk1,189 crore or about 3%.
The allocation of Power Division, which is in the second position with an allocation of Tk35,440 crore, has set to be decreased by Tk6,264 crore or about 18%. With an allocation of Tk29,177 crore in the new ADP, the position of the division to be dropped to the third position.
The second highest allocation of Tk32,042 crore is allocated to the Road Transport and Highways Division in the next ADP, which is also reduced by Tk813 crore. Tk32,855 crore was allocated under the division in the current financial year.
Tk13,726 crore will be allotted to the Ministry of Railways next year, a 4.5% lower than the allocation of Tk14,373 crore in the current financial year.
Tk11,388 crore is to be proposed for the Secondary and Higher Education Division in the next financial year, which is about TK -1805 crore less than the current year's allocation of Tk13,193 crore.
Completion of two major infrastructure projects like Padma Bridge and tunnel under Karnaphuli River pushed to reduce ADP allocation of Bridges Division to decrease by about Tk1,619 crore in the next financial year.
The division is set to be allotted Tk7,309 crore in the next fiscal to implement six projects, which is 18% less than the allocation of Tk8,928 crore in the current fiscal.
The analysis revealed that top ten ministries and division to receive an allocation over Tk1,86,965 crore, which is more than 72% of the total ADP size.
Highest priority on transport and communication:
In the continuation of the last few years, the transport and communication sector would get the highest priority in the development budget of the next financial year.
The sector would be allocated TK70,688 crore, around 26.67% of the total ADP. Power and energy sector would secure the second place receiving an allocation of Tk40,752 crore, about 15.38% of the ADP.
The third most priority sector education would receive Tk31,529 crore, about 12% of total ADP allocation.
The health sector would be recognised as the fifth priority sector following the housing and community facilities sector. Allocation of Tk20,683 crore will be proposed for health sector, 7.8% of the ADP.
10 projects to receive about 20% of the ADP
The top 10 projects out of total 1258 would receive allocation of over 51,975.47 crore, about 20% of the total ADP in the next fiscal, according to the proposal of the Planning Commission.
The Fourth Primary Education Development Programme (PEDP-4) will receive the highest allocation of Tk11,056 crore.
The Directorate of Primary Education is implementing the programme since 2018 with an estimated cost of Tk38,292 crore.
The Rooppur Nuclear Power Plant is slated to receive the second-highest amount of Tk10,503 crore followed by the Matarbari Power Plant with Tk6,005 crore.
The proposal indicates a significant emphasis on the transportation and communication sector, which will receive the highest priority in the development budget.
The power and energy sector will be the second-highest priority, followed by the education sector.
Notably, four projects each from the transportation and communication sector and the energy and power sector are among the top 10 recipients of allocations. The other two projects at the top of the allocation are education and health.
Among other mega projects, the Ashulia Elevated Expressway will receive Tk3,797 crore, ranking fourth in the ADP.
The Dhaka Mass Rapid Transit Development Project (Line-1) will secure the fifth position with an allocation of Tk3,594 crore.
Additionally, projects such as power grid network strengthening under PGCB and the Padma Bridge Rail Link Project will receive Tk3,594 crore and Tk3,544 crore respectively, ranking sixth and seventh in allocation.
The expansion of Hazrat Shajalal International Airport Project, aiming to develop the third terminal, will rank eighth in terms of allocation with Tk3,536 crore under the transportation and communication sector.
Furthermore, the expansion and strengthening of power systems under DPDC areas will receive Tk3,384 crore, ranking ninth.
Lastly, the only project in the health sector among the top 10 priorities will receive Tk3,000 crore of allocation.
Autonomous institutes will spend Tk13,286 crore from own funds:
Proposal from the Planning Ministry revealed that the autonomous institutes and the corporations of the government will spend Tk13,286.19 crore in the next fiscal year to implement several development projects.
The size of the next ADP would be Tk2,78,286.19 crore calculating the appending of such allocations, according to the Ministry of Planning.
However, the ADP size stands at Tk2,65,000 crore, according to the Ministry of Finance, which is reluctant to add the expenditure of autonomous bodies and corporations to the development of the government.
Proposal of the Planning Commission revealed that the autonomous institutes and the corporations of the government are implementing 79 projects with own financing only while they are financing for 102 more projects as a share with the government and foreign loans.
