ADP size to rise slightly as economy faces headwinds

The Annual Development Programme (ADP) allocation is set for a marginal increase in the upcoming budget for the fiscal year 2023-23 (FY24) as the government looks to take up austerity measures to tackle the ongoing economic headwinds.

The government has adjusted the allocation for mega projects of different sectors. While some projects are set for a rise in allocation, some will face a reduction.

The biggest portion of the allocation will go to mega projects under the power, health and communication sectors, according to the draft ADP finalised at an extended meeting of the Planning Commission at the National Economic Council (NEC) conference room in the capital's Sher-e-Bangla Nagar on April 30.

The NEC chair is scheduled to approve the ADP for the next fiscal year at a meeting today.

According to the final draft of the ADP development budget for FY24, the ADP size is Tk 2.63 lakh crore. Of this, Tk 94,000 crore will be funded by different development partners and the remaining Tk 1.69 lakh crore will come from the revenue collection of the government.

In the upcoming fiscal year, the size of ADP is going to increase by Tk 17,000 crore, or 6.80 per cent, compared to the ongoing fiscal year with Tk 2,46,066 crore ADP allocation.

According to the Planning Commission sources, the ADP allocation is not growing significantly due to an increase of interest and subsidy expenditure.

Currently, the biggest portion of the country’s foreign debt is going to the mega projects. In the next fiscal, the government is allocating the most for the Rooppur Nuclear Power Plant (RNPP), the country's largest project, according to the Planning Commission draft.

The draft shows that the government allocated Tk 9,706 crore for the RNPP project. In the current fiscal year, the original ADP for this project was Tk 13,395 crore. However, in the revised ADP (RADP), the allocation was reduced to Tk 11,139 crore. The foreign fund portion has been reduced by Tk 3,500 crore in the RADP. The foreign share in the allocation for the next fiscal has decreased by Tk 960 crore.

According to the draft ADP, the second biggest allocation is going to the Matarbari Ultra Super Power Project. Allocation for the project is increasing by Tk 2,444 crore to Tk 9,259.49 crore in the next fiscal year compared to the current fiscal. The project was allocated Tk 6,815 crore in the original ADP, but in the RADP, the allocation was raised to Tk 7,755 crore.

Besides, in the health sector, Tk 7,089.05 crore of the ADP allocation has been earmarked for the Health, Population and Nutrition Sector Development Program (HPNSDP). Allocation for the programme has been increased by Tk 1,192 crore compared to the revised ADP of FY23. In the meantime, RADP allocation for the programme stands at Tk 5897.47 crore. Most of the development work is done under this programme, which is the largest in the health sector.

The allocation for the Dhaka-Ashulia Elevated Expressway in FY24 has increased to Tk 5,870 crore, a Tk 2,168 crore increase from the current fiscal year. In the current fiscal, the expressway project was initially allocated Tk 3,702 crore, which was later reduced to Tk 3,300 crore in the RADP.

Moreover, Tk 5,500 crore is being allocated for the Padma Bridge Rail Link project in the upcoming budget. In the current fiscal year, the ADP allocation for the project was Tk 5,809 crore, which was later raised to Tk 5,909 crore in the RADP.

The ADP allocation for the development of Hazrat Shahjalal International Airport has been proposed at Tk 5,498.97 crore in the next FY. The allocation was Tk 6,019 crore in the original budget for FY23 and was later revised to Tk 4,469 crore in the RADP.

Meanwhile, in the ADP, Tk 8,215 crore is being allotted for three projects of the Dhaka Mass Transit Company in FY23, an increase of Tk 4,276 crore compared to FY23.

Among the projects, an allocation of Tk 3,910 crore is being earmarked for the 'MRT-1' project from Kuril-Rampura-Malibagh-Kamalapur and from Kuril to Kanchan Bridge. The allocation for this project was Tk 2,276 crore in the current FY, which was reduced to Tk 483 crore in the revised ADP. In addition, Tk 880 crore is being allocated for the MRT-5 project from Hemayetpur-Gabtali-Mirpur 1-Kachukhet-Gulshan-2 to Bhatara in the upcoming fiscal. The ADP allocation for the project was Tk 2,880 crore in the original budget for FY23, which was reduced to Tk 406 crore in the RADP. Also, the allocation for the Uttara to Motijheel MRT-6 project is being increased to Tk 3,425 crore. In the current year, the allocation for MRT-6 was Tk 2,882 crore initially and was later revised to Tk 3,049 crore in the RADP.

According to the draft proposal, Tk 3,778 crore is being allocated to the ADP for the Bangabandhu Sheikh Mujib Railway Bridge in the upcoming budget. In FY23, the project was initially allocated Tk 3,850 crore, which was later reduced to Tk 2,699 crore in the RADP.

Meanwhile, Tk 2,494.80 crore is earmarked for the cost of land acquisition and utility relocation of the Dhaka-Sylhet-Tamabil Four Lane Highway project which was allocated Tk 2,357.84 crore in the RADP of FY23.

Furthermore, Tk 1400 crore is being allocated for a Railway project from Dohazari-Ramu-Cox's Bazar to Gundhum. Allocation for the project was Tk 1020 crore in the RADP.

The multilane tunnel route project under Karnaphuli River is being allocated Tk 735 crore in the next fiscal. In the current fiscal year, the project allocation was initially Tk 2,000 crore and was reduced to Tk 1,721 crore in the RADP.