ADP execution slows in Q1

Staff Correspondent

18 October, 2019 12:00 AM printer

The pace of ADP implementation slowed in the first quarter of the current fiscal year as project assistance utilisation is yet to gain the expected momentum.

Implementing agencies only managed to execute 8.06 of FY20’s ADP outlay during the July-September period, the latest data by the Implementation Monitoring and Evaluation Division (IMED) suggest.

This performance was 0.19 percentage points lower than 8.25 ADP execution rate shown during the same period a year earlier.

In 2017-18FY, the implementation rate reached its peak in five years at 10.21 percent mainly driven by accelerated project aid utilisation from the first quarter.

In the year, PA release hit the highest at $6.37 billion, crossing $6 billion threshold for the first time.

Even after a modest fall, PA release maintained the pace last year with $6.21 billion total foreign fund disbursement.

The year-on-year expenditure growth, however, was 16.19 percent in the first quarter. Total ADP spending has so far reached Tk 17,344 crore this year, up from the last fiscal year’s Tk 14,927 crore.

Project assistance utilization rate slipped both in terms of percentage and volume during the July-September period.

The parentage fell from 8.65 percent to 5.89 percent while the expenditure amount declined from Tk 5,188 crore to Tk 4,226 crore.

In FY18, first quarterly foreign money utilization rate rose to as high as $12.86 percent with Tk 7,772 crore spending, supported by some large chunks of money released against some ongoing mega projects.

Local money utilization rate, on the other hand, improved to five-year high level of 9.60 percent from 7.47 percent while the amount increased to Tk 12,573 crore from Tk 8,436 crore.  Economic analysts say the government agencies prefer utilizing local money to project assistance as they find spending GoB money much easier than foreign money as development partners seek more accountability in using their money.

Top 15 ministries or divisions that fetched over 81 percent ADP money managed to post 8.53 percent average ADP implementation performance in July-September quarter with Tk 14,871 crore total spending. 

Among them, power division was the best performer with 14.56 percent execution rate. Secondary and higher education division came in second posting 13.91 percent performance followed by 13.33 percent posting of local government division.