Bangladesh unveils Tk 5.68 trillion budget for FY21 to tackle pandemic

Finance Minister AHM Mustafa Kamal has tabled a national budget of Tk 5.68 trillion for fiscal year 2020-21 to propel the government's two-pronged efforts to salvage an economy battered by the coronavirus epidemic while safeguarding public health.

The proposed spending plan, the biggest in the country's history, represents a 13 percent increase over the revised outlay for the outgoing fiscal year and is 8.56 percent higher than the main budget for FY2020.

Without foreign grants, the budget gap will widen to a record Tk 1.9 trillion, or 6 percent of the gross domestic product, which crosses the typical “red line” for the first time in recent history.

The finance minister unveiled his second national budget in a brief parliamentary session on Thursday afternoon in the presence of Prime Minister Sheikh Hasina and a limited number of lawmakers amid the ongoing coronavirus crisis.

 

President Abdul Hamid had earlier authenticated the budget bill after it was approved by the cabinet.

The 2020-21 budget is also the second presented by the Awami League government in their third term. The budget for the outgoing fiscal initially stood at Tk 5.23 trillion but was later scaled down to Tk 5.01 trillion.

The latest budget continues the trend of a year-on-year growth in government spending with Kamal's maiden fiscal plan in 2019-20 marking an 18 percent increase over the previous year’s revised budget while the 2018-19 budget presented by his predecessor Abul Maal Abdul Muhith was 25 percent bigger than the revised budget of the year before.

Economic activities have stalled in the last three months due to the pandemic with export and import hitting rock bottom. Financial losses will increase further if the crisis lingers, which makes the government worry about realising the revenue.

 

Bangladesh revised down its economic growth estimate to 5.2 percent for fiscal 2020 from its original estimate of 8.2 percent.

Bangladesh aims to achieve 8.2 percent economic growth in the year starting July 1, Kamal said in parliament.