Govt plans ambitious aid use target
The government plans to create an ambitious target of using foreign aid worth Tk 88,024 crore for development projects in the next fiscal year as external assistance has piled-up.
The amount is the same as $10.35 billion or more 39.72 per cent from the annual development programme (ADP) in the outgoing fiscal year.
Development partners also have indicated that they might inject more funds to greatly help Bangladesh get over the pandemic-induced slowdown quickly.
The full total size of the ADP could be fixed at Tk 225,124 crore within the next fiscal year of 2021-22, up from the revised ADP of Tk 197,643 crore.
An official of the look ministry said these were already informed about the ceiling of the allocation by the finance ministry. Predicated on the ceiling, the look ministry was formulating another ADP.
The next ADP will be finalised by the first week of May, and it could be placed prior to the National Economic Council for approval.
The official at the finance ministry said the federal government was looking to raise the allocation of foreign assist in the upcoming ADP as the united states was sitting on plenty of unused foreign aid.
He said the government could use as much foreign aid as possible as borrowing costs were very low.
The country began acquiring an increased flow of budget support from development lenders since FY20 to ride out the coronavirus pandemic.
At the start of the existing fiscal year, $50.39 billion in foreign aid was designed for the government, the best on record.
The total amount kept ballooning as more funds flowed in from the development lenders.
The Asian Development Bank (ADB) has recently provided $650 million in loans and $7.23 million in grants to control the socio-economic impacts of the pandemic and support quick recovery, according to a news release of the Manila-based lender on Wednesday.
The ADB is also processing two programme loans of $500 million each and a $940 million loan for the government's Covid-19 vaccination programme.
For 2021-2023, the ADB has programmed $5.9 billion firm and $5.2 billion standby project assistance for Bangladesh, it added.
The World Bank might provide around $6 billion in today's and next fiscal years for vaccine purchase, the health sector, and the economy's recovery.
Other lenders such as for example Japan and the Asian Infrastructure Investment Bank have also committed to providing foreign aids.
The finance ministry official said although government raised the allocation of the foreign assist in the ADP in today's fiscal year, the ministries and division performed poorly when it comes to utilisation.
In the initial ADP in FY21, the allocation of foreign aid was Tk 70,502 crore. It has been revised right down to Tk 63,000 crore.
In Bangladesh, the utilization of foreign aid has increased in recent years.
Aid disbursement rose more than 28 % to $8 billion in 2019-20, the best in the country's history.
In the upcoming ADP, the government's own contribution could be risen to Tk 137,100 crore from Tk 134,643 crore in FY21.
The neighborhood government division gets an allocation of Tk 34,204.04 crore and the road transport and highways division Tk 28,131.67 crore.
The power division may be allocated Tk 25,553.76 crore, the science and technology ministry Tk 20,723.86 crore, and the railways ministry Tk 13,619.64 crore.
The health services division is to get Tk 13,125.19 crore from the ADP.
Experts have recommended an increased allocation for the health sector.
The finance ministry official said the allocation might upsurge in the upcoming year, but the health services division was unable to utilise the funds properly.
According to a report of the Implementation, Monitoring and Evaluation Division of the look ministry, medical services division spent only 21 % of the allocation from the ADP in the nine months to March.
Medical services division received Tk 6,447.78 crore as project the help of the ADP and used Tk 664.94 crore, which is 10.31 % of the allocated fund.
The division was presented with Tk 5,531.56 crore from the state coffer. Nonetheless it were able to spend Tk 1,850 crore, which is 33.45 % of the allocation, one of the lowest among the ministries and divisions.
