Govt likely to cling to 8.2pc growth target
Despite Corona crisis, the federal government will probably set an ambitious growth target of 8.2 percent in FY’21 with the expectation of earning a turnaround following the crisis is over.
Concurrently, a subdued 5.4 percent inflation rate is being targeted for another fiscal year riding on the sliding global consumption and falling global fuel price.
The targets will be set in the upcoming national budget for the Fiscal Year 2020-21, according to draft budget documents.
The ministry of finance is currently working on the draft budget proposal and the ultimate budgetary figures and targets might see some changes following the Prime Minister’s approval.
Finance Minister AHM Mustafa Kamal is expected to place a budget of Tk 5,569.78 billion at the parliament on June 11, which is Tk337.78 billion higher than that of FY’20.
The finance minister will be putting a roadmap of bringing the economy back on track in the wake of crippling corona crisis in his budget speech, including steps for macro economy, agriculture, industry, SMEs and protecting businesses.
There will be also directives for post Covid-19 employment, investment, food security, social security and people’s health security in the budget speech, the finance ministry sources said.
Because of this, allocation for the health sector will rise by Tk100 billion while an announcement will come for the expansion of social security net.
There will be a plan to widen tax net rather than hiking tax rates along with a intend to cut corporate taxes to provide an area for business, official sources said.
The new budget will probably set a Tk3,780 billion income target with an impressive Tk1,789.78 billion deficit which is GDP’s 5.64 percent.
Out from the expenditure plan, Tk3,378.88 billion will be set aside for meeting the operational cost and Tk2,051.45 billion was already okayed as development expenditure.
In the ongoing 2019-20 fiscal year, a Tk5,231.90 billion budget was announced which includes been curtailed to Tk5,015.77 billion in the revised budget.
Of the earnings target, Tk3,300 billion has been estimated to result from NBR tax revenue, Tk330 billion as non-NBR tax revenue and Tk150 billion as non-tax revenue.
The government plans to meet up the budget deficit with Tk1,130 billion local resources, including Tk880 billion bank borrowing and Tk200 billion from the sales of savings certificates.
Gleam desire to receive higher foreign assistance of Tk770 billion in FY’21. Besides, the World Bank is likely to provide $1 billion budget support while ADB will give $200 million.
