Thursday, 30 June, 2022

Govt tightens grip on ADP money for fast-track projects

ADP allocation on most of the fast-track mega projects has been curtailed for the next fiscal year as part of the government’s austerity measures taken after the start of the Ukraine war coupled with the waning corona crisis.

The government finalised the allocation in the next fiscal’s ADP outlay of Tk 2.46 trillion last week by the National Economic Council (NEC) headed by Prime Minister Sheikh Hasina.

The country’s economy is still reeling under the corona crisis and the Russia-Ukraine war has posed a new threat to the economy.

As a result, the government had to tighten its grip on public expenditure to ease pressure stemming from the war that has caused a hike in commodity prices globally.

The government has bridled project expenditure under ADP as well for the upcoming 2022-23 fiscal year as a precautionary measure.

Undertaking new projects have been discouraged in the new ADP. The government has allocated Tk 390 billion less money than the actual demand for ADP money placed by the ministries, planning commission sources said.

The priority fast-track schemes are no exception as allocation for several such projects has been lowered in FY23 compared to that in the current fiscal year.

Currently, five of eight fast-track projects are ongoing. Of those, the allocation for two has been lowered and funding for one has been suspended. One project saw a modest rise in allocation but the Padma rail link project saw a big jump in allocation.

Programming Division Member Pradip Ranjan Chakraborty, however, claimed that the austerity measures are not applicable for the fast-track projects.

“Demand for money has come down for these projects as they are close to the finishing line. So, their allocation has been lowered,” he remarked.

These allocations have been finalized after holding meetings between the implementing agencies of these projects, the finance division and the Planning Commission, he explained.

Rooppur nuclear power plant: The lone nuclear power plant project, also the country’s largest infrastructure project, received the single largest allocation of Tk 133.95 billion in ADP. But the allocation was Tk 30.31 billion lower than Tk 164.26 billion than this year's allocation.

Metrorail: The Mass Rapid Transit (MRT-6) project fetched Tk 28.83 billion, much down from the current fiscal’s Tk 48 billion.

The project as a whole saw 85 progress and its Agargaon segment is supposed to come into operation by December this year and the full Uttara-Motijheel segment by June 2024.

Dohazari-Ghumdhum rail line: The government has suspended allocation for this project and directed not to spend any money on the project it until the project duration is extended. It has been placed in ADP book with an asterisk mark so that even the already disbursed money cannot be spent.

Matarbari Coal power project: has received a modestly higher allocation because of increased demand for money. The project received Tk 65.54 billion in the ADP, higher than the current fiscal’s Tk 61.62 billion.

Padma Rail Link: The Padma rail link project received a much higher allocation of Tk 58.09 billion after the project’s money requirement has increased. The allocation was Tk 38.24 billion during the current fiscal year. The project is supposed to be completed in 2024.

Padma bridge project: the government only set aside Tk 22 billion for the dream project as it is very close to the finishing line and is expected to open to traffic very soon.