Finance Minister AMA Muhith has unveiled a mega budget of Tk 295,100 crore on Thursday for fiscal 2015-16 year "with the goal of unlocking the endless potentials of Bangladesh" to achieve the millennium development goal set by the Awami League government led by Prime Minister Sheikh Hasina.
The revenue receipts for FY2015-16 have been estimated at Tk 208,443 crore, which is 12.1 per cent of GDP. Earning from NBR tax revenue has been estimated at Tk 176,370 crore, which is 10.3 per cent of GDP.
Tax revenue from non-NBR sources has been estimated at Tk 5,874 crore (0.3 per cent of GDP). Besides, Tk 26,199 crore (1.5 per cent of GDP) is expected to be collected from non-tax sources.
Total expenditure has been estimated at Tk 295,100 crore, which is 17.2 per cent of GDP. The allocation for non-development expenditure including other expenses has been estimated at Tk 198,100 crore (11.5 per cent of GDP).
Political stability, a drop in international oil and food prices and the 'comfortable' state of economy seem to have emboldened him to go for such a huge budget, Muhith said. However, traditional but futuristic measures could dominate the budget proposal might backfire, if non-economic factors such as political uncertainty and insecurity continued, say economists.
"This is the last year that will end our Millennium Development Goals (MDGs). We are now formulating the 7th five year plan, which builds on the unmet targets of the 6th five year plan and the post-2015 agenda," Muhith said during his over five hours long budget speech in parliament.
Speaker Dr Shirin Sharmin Chawdhury inaugurated the parliament session at 3:35 pm Thursday immediately after the entrance of President Abdul Hamid, Prime Minister Sheikh Hasina, MPs diplomats, journalists and distinguished citizens were present while Muhith was presenting his budget for the next fiscal.
"During the 6th plan tenure, we made remarkable progress in managing inflation, foreign exchange rate, budget deficit, foreign exchange reserve, public debt, and maintaining overall macroeconomic balance and stability. Now we are trapped in the 6 per cent growth trajectory for the time being," Muhith said.
"Our ultimate target is to transcend this cycle and move onto a higher growth path to transform our country into a developed nation by 2041. Political stability is the sine qua non for achieving this goal", he added.
Taking ADP allocation for autonomous bodies to the tune of Tk 3,996 crore into account, the size of the total budget will stand at almost Tk 300,000 crore.
The Finance Minister said the overall deficit of his budget will be Tk 86,657 crore, of which Tk 30,134 crore will be financed from the external sources and Tk 56,523 crore from domestic sources.
Of the domestic financing, Tk 38,523 crore will come from the banking system and Tk 18,000 crore from savings certificate and other non-banking sources.
"If we can increase disbursement from the huge pipeline of foreign assistance, we will be able to reduce our dependence on domestic borrowings," Muhith said.
"We will continue our efforts to this end so that foreign aid utilization rate increases in the next year,' he said.
In the proposed budget, 23.4 per cent of the total outlay has been allocated to social infrastructure sector, of which 20.4 per cent has been proposed for human resource development through education, health and other related sectors, 13.9 per cent for agriculture and rural development, 8.9 per cent to overall communication and 6.3 per cent to power and energy sector.
The proposed budget has given priority to poverty reduction, education, women empowerment and stop influx of rural people to urban areas by providing employment to them.
"We are trapped in the 6 per cent growth trajectory for the time being; our ultimate target is to transcend this cycle and move onto a higher growth path to transform our country into a developed nation by 2041. Political stability is the sine qua non for achieving this goal", Muhith said during his budget speech.
In the first half of the fiscal year, Muhith added, progress towards achieving more than 7 per cent growth exceeded our expectations. "But, it suffered a setback when the BNP-led alliance, with an unconstitutional demand, started a country wide rampage of violence from January this year," he said.
"Strikes, blockades and petrol bomb attacks brought havoc to the lives of men, women and children. More than 100 people were burnt. The SSC examinees were not spared from their atrocities, they could not sit for a single examination on schedule."
During 2009-2014, he said average growth was 6.13 per cent, public investment rate rose to 6.9 per cent from 5.6 per cent of GDP, while power generation capacity increased three times and per capita income increased more than twice.