Budget – roadmap to prosperity

14 June, 2019 12:00 AM printer

With the goal of achieving 8.2 per cent GDP growth, Finance Minister AHM Mustafa Kamal on Thursday proposed a cautious budget of Tk. 5,23,190 crore for fiscal 2019-2020. It is the biggest ever budget in Bangladesh’s history as the size of the budget marks an 18 per cent increase from the revised budget of the outgoing fiscal year. Yet, very rightly it is still being termed as a cautious budget considering the country’s increased economic growth. The Finance Minister could have put forward a far more ambitious budget, but we would commend him for setting achievable and realistic goals.

The proposed budget has substantially increased allocation in education, scientific research, widening of social safety net, and as well as for giving incentive to the Readymade Garment (RMG) sector and expatriate workers. Education budget in particular has been given the highest priority with the allocation of Tk 61,118 crore for the next fiscal year which is 17 per cent higher than the education budget in outgoing fiscal. The decision to earmark more budgetary allocation for education is positive and the fund should be directed to raise the standard of education from elementary to tertiary level. Also it is timely and appropriate that the Finance Minister placed due importance on MPO inclusion of non-government schools and colleges, advanced research and 4th industrial revolution, health education and modernisation of madarasa education.

The budget is, however, a policy document, and the government has to ensure its quality and effective implementation. Therefore real challenges lie in its implementation. Failure to implement the Annual Development Programme (ADP) allocation is a nagging drawback in budget implementation. In the proposed budget, Kamal increased ADP allocation to Tk. 202,721 crore from Tk 165,000 crore of the outgoing fiscal, in spite of the fact that ADP implementation remained lackadaisical and almost every year the government has to revise down the allocation. Therefore, the government must come up with proper mechanism for efficient implementation of the new fiscal plan.

Meanwhile, the Finance Minister envisioned that the government will bring down inflation rate to 5.5 per cent but how that goal will be achieved by introducing a stricter VAT law remains to be seen. We are relieved to note that the Finance Minister assurances that there was no component in the new VAT law that would cause price spiral of essential commodities.  Overall, this is one proof a pro-people budget.