Saturday, 22 January, 2022

Review of 2021

Govt was slow in approving new projects

It focused more on already approved projects instead of launching new ones amid corona crisis

Govt was slow in approving new projects

The government has been able to restore economic activities after the last year’s shocks, but a full recovery from the pandemic still remains far.

It reflects in the speed of approval of new annual development programme (ADP) projects or revision of the ongoing schemes.

The data shows that the number of approved projects and the meetings of the approving body ECNEC were much less in the just-concluded year 2021 compared to the pre-Covid level.

Usually, the Executive Committee of National Economic Council (ECNEC) holds three meetings a month.

As per the practice, a total of 36 meetings were supposed to be held last year.

But only 15 meetings were held in the year. However, the meetings approved 120 projects involving a total cost of over Tk 1,412.51 billion.

The approvals came as the government had to bridle its development expenditure considering the pandemic crisis.

 Actually, the government was more focused on allocating money on the already running important projects instead of picking up comparatively less important new projects.

Economic analysts too suggested making a robust allocation on transformational projects instead of picking up new ones, given the resource constraints during the pandemic.

Of the total approved project cost last year, the major share of Tk 800.50 billion or over 56 percent was estimated to come from local resources while Tk 597.37 billion from overseas development partners.

The first ECNEC meeting of the year was held on January 05, which approved Tk 95.69 billion project.

It was the only meeting of the month.

In February last year, two meetings were held approving Tk 113.24 billion and Tk 198.45 billion projects respectively.

A single meeting was held in March approving Tk 56.19 billion projects.

There was no meeting in April and again one meeting was held in May that gave approval to Tk 119.01 billion project.

Only exception of the year was the month of June when as high as three meetings were held, in which a total of Tk 161 billion projects were approved.

Again, a single meeting was held in the month of July that cleared only Tk 25.75 billion projects.

Two meetings were held in August to approve a total of Tk 134.27 billion projects.

One meeting each month was held in September, October, November and December, which approved projects involving a total of Tk 509.32 billion.

“The government had to spend much money on fighting coronavirus pandemic. The budget deficit widened to 6 percent of GDP because of increased spending on health emergencies. The deficit is being closed with budget support,” said State Minister for Planning Dr Shamsul Alam.

 “As a result, the wholesale project approval is not possible. The projects are being approved after meticulous scrutiny,” he said.

“We won’t stop approving projects, but pick up new projects cautiously. So the number of projects remained low last year,” the state minister added. 

Planning Secretary Pradip Ranjan Chakrabarty said that the coronavirus pandemic had a negative impact on development activities. He said the government had to curtail less important development expenditure due to a setback in revenue collection and other reasons.

 Planning secretary said in approving new projects last year, the government calculated many things.

 “However, the situation is improving now as implementation of mega and other projects has gained momentum. This can help recover the pandemic losses,” he said.