Dhaka, Bangladesh (BBN)-Bangladesh Finance Minister AMA Muhith placed BDT 3.40 trillion budget outlays for fiscal 2016-17 at the National Parliament of Bangladesh on Thursday.
The minister has begun placing the power-point presentation of the crucial yearly spending plan for the nation around 3:35pm (BST).
This is the consecutive eighth budget for the finance minister.
The aim of the gigantic budget is to achieve 7.2 percent economic growth by the end of the upcoming fiscal year (FY) and bring dynamism in the overall economic activities through improving infrastructure facilities across the country.
Of the total budget outlay, BDT 1.10 trillion would be set aside for development expenditure and the remainder for non-development spending.
The total revenue-generation target has been set at BDT 2.42 trillion.
The National Board of Revenue (NBR) would have to generate 84 percent of the targeted amount.
Non-tax revenue, which usually comprises dividends and profits of government entities, has been set at BDT 323 billion.
Of the revenue target, 36.47 percent would come from value added tax (VAT) and 35.93 percent from income tax.
To meet the shortfall in the deficit budget, the government would borrow BDT 970 billion, equivalent to 5.0 percent of the GDP (gross domestic product).
In case of deficit financing, the bank borrowing target would be set at BDT 389 billion and another BDT 200 billion is expected to come from national savings schemes.
The draft budget is likely to focus on the implementation of 10 first track mega projects to spur growth and development catering for the huge population and business sector.
Two deep sea ports, Rooppur Nuclear Power project, Metro rail, Matarbari coal-fired power plant and Padma Bridge Rail Link are among the first track projects, according to officials concerned.
The document for the mega projects would be titled ‘Big projects in transforming infrastructure: new dimension in accelerating growth.’
The budget speech would focus on job creation, enhanced investment, and women empowerment, they added.
The budget document is likely to slash the allocation for subsidies, as petroleum prices in the global markets are plummeting.
The original budget for FY16 earmarked BDT 250 billion for subsides, but the revised budget slashed it to BDT 180 billion.
In FY 17, the government may set earmark BDT 400 billion for interest payments, up from BDT 350 billion in FY16.
Despite some risk factors, the government is set to keep the inflation rate at 5.8 per cent in the next fiscal beginning from July 1, 2016.
The inflation target has been estimated considering the existing prices of essential commodities including petroleum products in the global market, a senior official familiar with the budget preparations told BBN in Dhaka earlier.