Bangladesh fifth lowest among 41 LDCs

Bangladesh’s education expenditure as a percentage of GDP (gross domestic product) is the fifth lowest among 41 least developed countries (LDCs) in the world.

Bangladesh’s education expenditure as a share of GDP is poorer than Nepal, Afghanistan, Bhutan, Myanmar, Uganda, Senegal, and Mali.

On average, at least 35 LDCs spent 2 per cent or more of their GDP on education from 2016 to 2022, but Bangladesh’s education expenditure as a share of GDP is below 2 per cent, said Centre for Policy Dialogue (CPD) in its report on the proposed budget for the fiscal year 2023-24.

According to the CPD, among the 41 LDCs, the highest 11.1 per cent of GDP is spent by the Solomon Islands and the lowest and 0.2 per cent by Somalia while Bangladesh spent only 1.8 per cent.

The neighbouring Bhutan spent 6.6 per cent of its GDP on education while Nepal 3.7 per cent, Afghanistan 3.2 per cent, and Myanmar spent 2.1 per cent, said CPD while presenting its budget analysis on Friday at a hotel in the capital.

CPD said the education budget as a share of the total budget increased slightly from 10.67 per cent in the revised budget for FY23 to 11.57 per cent in the proposed budget for FY24 while the education budget as a share of GDP increased slightly from 1.59 per cent in the revised budget for FY23 to 1.76 per cent in the proposed budget for FY24.

The 8th Five Year Plan states that the education budget should grow from 2 per cent of GDP in FY19 to 3 per cent of GDP by FY25. However, the education budget is not even 2 per cent of GDP in FY24, said CPD in its budget analysis report.

Finance Minister AHM Mustafa Kamal on Thursday proposed to allocate a total of Tk 88,162 crore for education for the 2023-24 fiscal year. The allocation is 11.57 per cent of the total budget outlay and 1.76 per cent of GDP.

Mentioning that no Bangladeshi universities could make it to the top 500 universities in the QS World University Rankings 2023, CPD urged the government to increase allocation to the education sector.

CPD in the budget analysis also said budget utilisation decreased from 95 per cent in FY19 to 87 per cent in FY22 while the growth in total actual expenditure decreased by 12 per cent between FY21 to FY22.

Additionally, development expenditure as a share of total expenditure too decreased from 34 per cent in FY21 to 29 per cent in FY22. In recent fiscal years, actual development expenditure has been significantly lower than actual non-development expenditure in the education sector.

CPD also said the government has exempted Bengali medium schools but the VAT on English medium schools continues to be at 5 per cent of the budget for FY24. The existing VAT puts an additional burden on the parents of middle-income households. It said the VAT on English medium schools should be exempted in FY24.

It said private academic institutions are subjected to 15 per cent corporate tax in the proposed budget for FY24, but it should be reduced to 10 per cent.

It also urged the government to withdraw the 15 per cent VAT on ballpoint pens in FY24 as it is mostly used by students in the country.

CPD said the total tax incidence on imported books is 73.96 per cent but this impedes the efforts made in order to achieve SDG 4, which aims for inclusive and quality education for all. So, all taxes on imported foreign books should be exempted.

The allocation of stipends for secondary, higher secondary, and madrassah education students has decreased by 43 per cent in FY24. For the stipends for undergraduate and postgraduate students, the allocation per beneficiary per year is only Tk 258 in FY24.