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ADP implementation at 32.10%, lowest in 7 yrs

Expert says situation will improve if foreign aid projects are implemented quickly
Mohammad Zakaria
23 Mar 2023 00:00:00 | Update: 23 Mar 2023 00:05:21
ADP implementation at 32.10%, lowest in 7 yrs

Bangladesh has seen only 32.10 per cent implementation of the Annual Development Programme (ADP) in the first eight months (July-February) of FY2022-23 — the lowest in the same period in seven years.

The implementation rate was 35.80 per cent in the same period of FY20221-22 and 36.91 per cent in FY2016-17, according to the Implementation Monitoring and Evaluation Division (IMED).

IMED data also showed that the ADP implementation rate was 33.83 per cent in Jul-Feb of FY2020-21, 37.26 per cent in FY2019-20, 39.13 per cent in FY2018-19, and 38.01 per cent in FY2017-18.

In the first eight months of FY23, Tk 82,179.96 crore was used to implement the ADP. Of that, 32.22 per cent came from the government, 35.69 per cent from foreign assistance and 27.37 per cent came from the organisations that are implementing the projects.

The government had allocated 0.04 per cent fund of the total ADP for the Foreign Ministry but the ministry did not use any of it, according to IMED data.

During the same period, the Public Administration Ministry executed only 10.26 per cent of the allocated fund, the Land Ministry 9.99 per cent, the Health Ministry 15 per cent, the Shipping Ministry 15.26 per cent, the Primary and Mass Education Ministry 19.51 per cent, the Directorate of Secondary and Higher Education 16.70 per cent, Public Security Division 18 per cent, and Disaster Management and Relief Ministry 21.88 per cent.

Besides, Cabinet Division executed 99.54 per cent, Bridge Division 47.19 per cent, and Energy Division 56.83 per cent of their ADP allocation.

“The ministries and divisions have been failing to increase the implementation rate in this fiscal year compared to the previous fiscal year. We have repeatedly asked them to speed up project implementation works but they have failed to follow through,” a senior official of IMED told The Business Post on Wednesday.

IMED has also given some special guidelines to the ministries and divisions to improve their project implementation capacities to accelerate the project works, they said.

The prime minister at ECNEC meetings also instructed to expedite project executions avoiding an increase in costs and time due to the ongoing global crisis.

IMED has asked the project implementing agencies to follow this unless there is a valid reason, the senior official said.

State Minister for Planning Shamsul Alam told The Business Post that ADP implementation is slow because of the high inflation rate and the impacts of the Russia-Ukraine war around the world.

“The prices of all kinds of construction materials have increased. That’s why we are unable to purchase the materials needed for the projects at the prices we wanted,” he said.

“We are now revising the projects. We will soon procure what we need at the new prices and resume the projects. The implementation rate will rise very soon,” Shamsul expressed hope.

Zahid Hussain, the former lead economist of the World Bank’s Dhaka office, also said that under present circumstances, caused by high inflation and the dollar crisis, the low implementation rate is logical.

But the situation will improve if the projects being implemented with foreign aid are completed quickly because that will bring in more dollars and it will decrease the overall pressure on the economy, he added.

According to IMED, the execution rate stood at 92.89 per cent in FY22. The total implementation rate was 82.11 per cent and 80.39 per cent in FY21 and FY20, respectively.

The government had allocated Tk 2.46 lakh crore for the ADP in FY23. The National Economic Council recently approved the Revised ADP (RADP) of Tk 2,27,566 crore for this fiscal year.

A total of 1,525 projects have received allocations in RADP, and 343 are expected to be completed within FY23. Of them, 1,410 are investment projects and the rest 115 are technical assistance projects.

The government will provide Tk 1,53,066 crore of the RADP and Tk 74,500 crore will come from foreign funds. The Planning Commission had trimmed down the ADP allocation by Tk 18,500 crore from foreign assistance after discussing with all ministries.

Zahid said this decision was not right since more foreign assistance would have meant more foreign currency entering the country’s economy.