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FY 2024 budget tomorrow

Focus on inflation taming, macro stability

Published : 30 May 2023 11:08 PM

Finance Minister AHM Mustafa Kamal will place a national budget of about Tk 7,61,785 crore for the upcoming fiscal 2023-24 at the National Parliament tomorrow focusing on inflation control and macroeconomic stability.

Besides, keeping in mind the concept of “Smart Bangladesh”, the government will also focus on creating smart manpower to cope with the impacts of the Fourth Industrial Revolution (4IR) for the next budget.

Officials said the government plans to prioritise capacity building by providing the necessary training as the lack of smart manpower will hinder the transformation of the country into a “Smart Bangladesh”.

The government has set about 7.50 percent gross domestic product (GDP) growth target for the next budget (FY24), a Finance Ministry official said.

He said, this growth is achievable as the country's macroeconomic condition is good. 

However, the Prime Minister has directed to increase the implementation rate of Annual Development Program (ADP) in the coming days, strengthen the monitoring system, maintain foreign exchange reserves, prevent hundi and increase remittances through legal channels and rural development, he mentioned. 

He also said that inflation should be kept at a tolerable level. 

The government has a plan to emphasise on agricultural production to ensure food security, he said, adding that the Prime Minister asked the authorities concerned to use every inch of land for food production. 

On the other hand, the government has set a target to collect Tk 5,00,000 crore as revenue in the upcoming budget for FY24. Of the revenue collection target, the National Board of Revenue (NBR) will collect Tk 4,30,000 crore, up about 16.22 percent or around Tk 60,000 crore over that in the previous fiscal amounting to Tk 3,70,000 crore and another Tk 70,000 crore will be collected from other sources, they mentioned.

The budget deficit is Tk 2,61,991 crore. The government has set a Tk 263,000 crore Annual Development Program (ADP) for the next fiscal year (FY24) making the highest allocation of Tk 75,945 crore (28.88pc of allocation) in the transport and communication sectors.

However, the government plans to raise fund allocation and number of senior citizen beneficiaries, widows, and disabled persons for ensuring social security in upcoming budget fiscal year (FY) 2023-24.

According to sources in the Ministry of Finance, a proposal has been made to create a fund of Tk 1.19 lakh crore for the poor and backward communities. 

The Finance Ministry has started preparing to increase the allocation of funds by 5 percent more with the current allocation in the social security sector.

In the national budget for the current fiscal year 2022-2023, the government has created a fund of Tk 1.13 lakh crore for social safety-net programs, which was 2.55 percent of Gross Domestic Product (GDP). 

A senior official of the Finance Ministry said considering the upcoming elections and the current economic crisis, the government is going to increase this fund in the upcoming budget.

He said the government is constantly increasing the scope of the social safety net to reduce poverty and inequality. 

Multifaceted programs are being conducted to fulfil the basic needs of the poor, helpless and marginalized people who are backward in the society, he mentioned. That is why the government is keeping a separate allocation for social security and increasing the amount of allowance and the number of beneficiaries every year, he added.

He said that the government will increase the allocation in the coming budget as well. There are plans to increase the amount of allowance by at least Tk 100 to meet the ongoing inflation and basic needs. 

Although there was an attempt to increase the allocation further, the government has limitations in increasing the allocation more simultaneously.

According to Ministry sources, the social safety net program in Bangladesh includes widows, elderly population, physically challenged, mothers, freedom fighters, retired civil servants and so on. 

In addition, cash-based social security measures include Food for Work (Kabikha), Money for Work (Kabita), sale of goods in the open market and stipends for students.

According to the sources of the Department of Social Services, in the current fiscal year, Tk 57.10 lakh elderly people were given allowance at the rate of Tk 500 per person per month. 

The government has allocated Tk 3,444.54 crore for this sector in the current fiscal.

According to the proposal in the next budget, the beneficiary allowance will be increased from Tk 500 to Tk 600. 

At the same time, there is a proposal to increase the allocation of Tk 761 crore by increasing the number of beneficiaries to 58 lakh.

On the other hand, in the fiscal year 2022-23, a total of 24.75 lakh widows and widowed women were given allowance at the rate of Tk 500 per person per month, for which Tk 1,495.40 crore has been allocated. 

The government is going to raise it to 600 per person in the next budget proposal. At the same time, an additional allocation of Tk 216 crore is being prepared in the next budget to increase the number of beneficiaries.

Apart from this, there is a possibility of providing additional funds of Tk 550 crore in the next budget from the current allocation of the government for disabled and physically challenged people, under which the number of beneficiaries is likely to increase from 23.65 lakh to 29 lakh. 

At present, Tk 2,429.18 crore has been allocated in this fund. There is a proposal to increase the amount of allowance in the next budget.

Earlier, Finance Minister AHM Mustafa Kamal presented the Tk 678,064 crore national budget for the fiscal year 2022-23, with the theme "Return to the Path of Development Leaving the Covid-19 Behind" to overcome the impact of coronavirus pandemic and Russia-Ukraine war on the economy. The revenue target was set at Tk4.33 lakh crore, while the budget deficit was Tk2.42 lakh crore or 5.4 percent of GDP.