Muhith set to unveil mega budget with an eye on the future

Bangladesh is waiting with bated breath to see what tricks Finance Minister AMA Muhith pulls out of his black briefcase on Thursday to make 35 percent more revenue earnings.

Businesses, investors and the taxpaying people in general will be glued to their TV and radio sets, mobile phones and computer screens. They will turn on the radio to know about the pills the 83-year old will dish out to manage a Tk 3.5 trillion financial outlay.

With a massive revenue target of Tk 2.5 trillion, the finance minister is vying to surpass past records of high expectations.

Muhith has maximised the revenue and expenditure targets in his proposed budget to work towards a Tk 5 trillion budget in 2018-19.

He has had to scale down the National Board of Revenue’s goal by Tk 260 billion but that has not dispirited him from fixing a modest target in the budget he proposes.

Instead, like in the current one, the budget chief is about to unveil a massive expenditure plan based on the expectation of mopping up equally huge sums as revenue.

Muhith, who foresees social security for all by 2021, has already said that his proposed budget has been tailored keeping 2018-19 in mind.

Carrying his familiar black briefcase, he will arrive in Parliament with Prime Minister Sheikh Hasina at 3:30pm to present his 10th budget and the third in the Awami League-led coalition’s second consecutive term in office.

In a different era and context, Muhith had presented two budgets (1982-83 and 1983-84 financial years) during HM Ershad’s rule.

The late finance minister, Shah AMS Kibria, had presented six consecutive budgets during his time.

But the record of tabling the maximum number of budgets is still held by another former and now late finance minister – Saifur Rahman. He had presented 12 in all.

In a pre-budget interview, Muhith had told bdnews24.com about his confidence in presenting big budgets.

“I have gathered the courage by presenting one big budget after another. I have become optimistic. I am going to present a budget of Tk 3.5 trillion, spurred on by that confidence and optimism.”

He is unperturbed by the fact that he has to revise his revenue targets, which will remain unfulfilled in the current financial year, ending on June 30.

“I have revised my seventh budget, in which the revenue collection fell 8 percent short of target. Naturally, I am very upset,” he had said in the interview.

But prevailing national and international situations have lent him the courage to think big.

“This time, I am going to present the budget in a comfortable situation… Stability has returned to politics. Strikes and shutdowns appear to be a thing of the past. Our entrepreneurs are feeling confident again.

“The prices of fuel oil and foodstuff are low in the world market. Our foreign exchange reserves have touched $ 29 billion. The export trend remains positive. These together have given me the courage to go for a big budget.”

Mohammed Farashuddin, former governor of the Bangladesh Bank, told bdnews24.com in a pre-budget interview that “increasing revenue collection would be the biggest challenge”.

He added: “If revenue collection is not increased, it will be difficult to implement the budget.

“So, my advice is that a path that creates a win-win situation for the government and taxpayers should be adopted. The private sector has to be taken into confidence. The number of taxpayers has to be increased. Revenue collection has to be increased in this manner.

He also said that during the past five years of the Awami League-led coalition government, revenue collection had increased by 11 percent on average and so had expenditure. But at no stage had the finance minister allowed the deficit to cross the 5 percent mark.

Bangladesh’s first finance minister Tajuddin Ahmed had presented the independent country’s first budget worth Tk 7.86 billion.

The last of the three budgets presented by Ziaur Rahman was within Tk 25 billion.

The last budget of former finance minister Saifur Rahman was to the tune of Tk 700 billion.

The budgets under the caretaker government, too, were less than Tk 1 trillion.

GDP target 7.2 percent

The new budget to be placed on Thursday is believed to have set a GDP growth rate of 7.2 percent.

It is also expected to bring down inflation to 5.8 percent from 6 percent.

The budget deficit is expected to be within 5 percent of the GDP, the finance minister has indicated.