Strengthening the social safety net has been given the highest priority in the draft budget for the fiscal 2020-21 to recover the country’s shaken economy due to the worldwide Covid-19 pandemic.
The draft of the budget, which will be placed before the national parliament next month, has already been handed over to Prime Minister Sheikh Hasina, finance ministry sources said.
The draft budget has also emphasized on health, agriculture, rural development and implementing mega projects to build a strong economy and get prepared to tackle any probable future financial crisis, they added.
A senior official of the finance ministry told Bangladesh Post that almost everything has come to a standstill due to the coronavirus pandemic, but the work for preparing the budget for the next fiscal year 2020-21 is going on in full swing.
“If everything goes well, finance minister AHM Mustafa Kamal is scheduled to place the budget in the parliament on 11 June. The size of the new budget may be around Tk 5,60,000 crore and revenue collection target can be Tk 3,95,000 crore. At the last moment the size of the budget may increase further”, he added.
The coronavirus pandemic has weakened the country's success in reducing the poverty over the past decade. For this, the government will pay special attention to social safety net and agriculture in the upcoming budget. Allocations in these sectors may be doubled in the upcoming budget, the official further said.
When asked about the upcoming budget, Planning Minister MA Mannan said, “My personal opinion is that more importance should be given in the agriculture and health sectors in the new budget.”
“The upcoming budget will be a rehabilitation budget”, he said adding that, “The growth in the current financial year will be much lower due to the coronavirus outbreak. But I hope that if this situation does not last for a long time, our growth will be better in near future.”
Mannan said, “We should build stronger health sector to tackle such crisis. So, we have to enhance the capacity by appointing increasing number of doctors and nurses, and setting up more ICUs and ventilators.”
“Besides, we need essential medical equipment in many areas of the country. And naturally the focus will be on agriculture following the economic setback.”
“This sector (agriculture) still remains the main driver of our economy. Most people of the country either directly or indirectly are involved in this sector. As per my assumption, the government will give the highest priority to this sector, he said.
However, the government is worried to collect both current and future revenue as Covid-19 crisis has disrupted the supply chain globally, which has negatively affected export and import of all kinds of goods.
As a result, the Finance Ministry expects to collect lower revenue collection than the target, an official said.
The revenue collection target of the National Board of Revenue (NBR) was Tk 3,25,000 crore in the current financial year, he said adding that, in the next budget, the revenue collection target may be Tk 3,95,000 crore.
Of this, Tk 3,30,000 crore can be targeted from tax under the NBR, and Tk 65,000 crore tax outside the NBR and revenue sectors without tax, he said further said.
The finance ministry expects to get Tk 5,000 crore foreign donation in next fiscal year. Budget deficit can cross Tk 1.60 lakh crore, he mentioned.