Development spending lowest in 12 years
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Development spending in Bangladesh stood at 32.10 per cent in the first eight months of the current fiscal year, the slowest pace of implementation during the rule of the Awami League, official figures showed.
In taka terms, the amount spent from the budget under the annual development programme (ADP) was lower in July-February as well than the amount expended in the identical period a year earlier.
The government managed to spend Tk 82,170 crore from its ADP budget in July-February of 2022-23, which was Tk 84,765 crore in the same period in 2021-22, according to data from the Implementation Monitoring and Evaluation Division (IMED).
As of February, the ministries and divisions managed to spend 32.10 per cent of the total ADP allocation of Tk 256,003 crore set aside to carry out development activities throughout the current fiscal year.
It was 35.80 per cent in the same period of FY22 and the lowest since 2010-11 when it stood at 37 per cent.
Between July and February, implementing entities spent Tk 46,261 crore from the government's portion of the ADP, down 6.72 per cent year-on-year.
The use of government funds declined as Bangladesh took various austerity measures in project implementation owing to the economic crisis, higher inflation and the US dollar shortage caused by the fallout of the Covid-19 pandemic and the Russia-Ukraine war.
For the past three years, it has put the implementation of low-priority projects on hold to free up funds for the more productive sectors.
Zahid Hussain, a former lead economist of the World Bank's Dhaka office, said the lower spending of the government fund was in line with the need to stabilise the macroeconomy.
There has been no restriction when it comes to spending from project assistance. As a result, the use of project assistance saw a 6 per cent year-on-year increase to Tk 33,190 crore during the same period. It was Tk 31,285 crore in the previous fiscal year.
"But there should have been more emphasis on accelerating the implementation of the projects backed by foreign aid," said Hossain.
Spending by the state-owned enterprises came down to Tk 2,719 crore in the eight months to February, against Tk 3,886 crore in FY22, IMED data showed.
Though there has been no directive on restricting expenses in the health and education sectors, development expenditure in the segments has remained the lowest.
Among the fifteen highest recipients of ADP, the health services division was the worst-performing division in July-February. Its spending stood at Tk 2,366 crore, accounting for only 15 per cent of the total allocation of Tk 15,779 crore.
Other low performers include the shipping ministry, the secondary and higher education division, and the primary and mass education ministry.
The power division was the top performer as it spent 47.78 per cent of the budget.
The bridges division came second with expenditure standing at 47.19 per cent, followed by the housing and public works ministry and the Prime Minister's Office, whose spending was 38.83 per cent and 38.03 per cent respectively.