Tk 7,61,785 crore budget seeks to appease

The government is expected to place a budget of Tk 7,61,785 crore aiming to tame the soaring inflation and tackle fiscal risks to appease the people ahead of the national election.

Finance Minister AHM Mustafa Kamal is scheduled to place the budget for the new financial year in the budget session - beginning today - of the Jatiya Sangsad at 3.00pm on Thursday.

In his proposal, the minister is likely to set the revenue collection target at Tk 5 lakh crore and set the budget deficit at Tk 2,61,785 crore for FY24, according to sources at the finance ministry.

Besides, the government’s operating expenditure is expected to be fixed at Tk 4,75,261 crore and total development cost Tk 2,77,582 crore.

Sources said the Gross Domestic Product (GDP) has been estimated to be Tk 50,06,782 crore for FY24, which was Tk 44,49,959 crore in the current fiscal year. The budget expenditure for the next fiscal year is equal to 15.2 per cent of the GDP, which is Tk 83,721 crore more than the original budget of FY23. The GDP for FY24 has been estimated with FY16 as the base year.

According to finance ministry officials, the government is looking to collect Tk 4,50,000 crore revenue from tax. Of this, the National Board of Revenue (NBR) will collect Tk 4,30,000 crore and non-NBR agencies will collect Tk 20,000 crore. In addition, the non-tax revenue target is estimated to be Tk 50,000 crore and foreign aid Tk 3,900 crore.

Total revenue collection and foreign aid is expected to be Tk 5,03,900 crore.

The government is planning to meet nearly 60 per cent of the estimated budget deficit from domestic sources in the upcoming FY24, sources said.

The budget deficit, in the meantime, is estimated to be Tk 2,61,785 crore or 5.2 per cent of the GDP.

To meet the deficit, the government is expected to collect Tk 1,55,495 crore from internal sources. Of the internal sources, Tk 1,32,395 crore will be taken as loan from the domestic banking system, including Tk 86,580 crore in long-term loans, Tk 45,815 crore in short-term loans. In addition, Tk 23,000 crore is expected to be sourced as non-bank loans, including Tk 18,000 crore from national savings tools and Tk 5,000 crore from other sectors.

Moreover, a net foreign loan of Tk 1,02,490 crore is expected to cover the budget deficit. The total foreign loan is expected to be Tk 1,27,190 crore, of which Tk 24,700 crore will be used in debt repayment.

Meanwhile, the government’s operating expenditure has been estimated at Tk 4,75,281 crore, which is Tk 63,875 crore higher than the current fiscal. Of this, recurring expenditure is estimated to be Tk 4,36,247 crore, internal debt interest payment Tk 82,000 crore, foreign loan interest payment Tk 12,376 crore, capital expenditure Tk 39,034 crore, food expenditure Tk 502 crore, and loan and advance will account for Tk 8,420 crore.

Capital expenditure includes resource collection, land acquisition, constructions and public works, share and equity investment. In the meantime, the development cost will increase only Tk 17,965 crore in FY24 compared to the current fiscal year.

The development expenditure is estimated to be Tk 2,77, 582 crore. Out of this, Tk 3,768 crore is likely to be allotted for various government schemes, Tk 7,986 crore for non-ADP special projects, Tk 2,63,000 crore for ADP, and Tk 2,828 crore for food programmes.

Finance ministry sources said the government is expected to allot Tk 10,895 crore for projects funded by autonomous organisations and corporations. In addition, Tk 779 crore is expected to be allotted for development programmes supported by the Export Credit Agency which will take the ADP allocation to Tk 2,74,674 crore.