Govt to set ambitious aid spending target
The government is set to lay down an ambitious foreign aid utilisation target for next fiscal year with the aim of quick implementation of many transforma-tional infrastructure projects.
Foreign aid will account for Tk 57,000 crore (equivalent to about $7 billion) in fiscal 2017-18's development budget, said officials of finance and planning ministries -- almost double the country's overseas fund utilisation record.
Bangladesh could never utilise more than $4 billion of foreign aid in a year.
Some Tk 35,797 crore of foreign aid has been allocated for this fiscal year but only 42 percent of the amount could be utilised in the first nine months.
Japan, India, China and Russia have committed to financing a number of mega projects against which a big amount is expected to be released in the upcoming fiscal year, said a planning ministry official.
“The government wants to make the implementation status of the projects visible before the next parliamentary elections. Whatever the historical trend is, the government thinks disbursement will accelerate next fiscal year,” he added.
Russia will provide about $12 billion for the Rooppur nuclear power plant project.
Construction work for the main power plant will start in full scale at the end of this year, so more than Tk 8,000 crore may be allocated for the project in 2017-18's annual development programme budget.
Besides, several foreign-assisted projects are under implementation in the power sector.
Foreign aid allocation for the power sector may be more than Tk 9,000 crore in next year's budget, said planning ministry officials.
China has committed about $5 billion for the Padma Rail Link project and the Karnaphuli tunnel construction project. The government has a target to open the Padma Bridge in 2018. Prime Minister Sheikh Hasina has also issued a directive to connect the rail link at Jazira point with the bridge as soon as it is opened. The finance ministry has already written letters to China to approve the foreign assistance by this year.
Work on metro rail slowed down due to militant attack in Gulshan last year, which killed 7 Japanese nationals working on the project. But thanks to various steps taken by the government Japan has resumed work.
Finance Minister AMA Muhith himself held meetings with different higher-ups of Japan, with the most recent one being last week on the sidelines of the Asian Development Bank's annual meeting in Yokohama.
Muhith laid out the latest security situation in Bangladesh and requested them to expedite the implementation of several projects including the metro rail.
About Tk 3,000 crore will be allocated for the metro rail project in next year's budget. The government is also hoping that the Matarbari coal-based power plant to be implemented with Japanese assistance will be quickened next year.
A big amount of disbursement from India's $3 billion line of credit may be made in the upcoming fiscal year, said planning ministry officials. Besides, the World Bank and the ADB have committed to increasing their assistance to Bangladesh, said a finance ministry official.
A recent ADB report showed that Bangladesh was among the top performers of its member countries in terms of loan disbursement ratio last year. “The trend will continue next fiscal year,” the finance ministry official said.
The size of 2017-18's ADP may be Tk 153,330 crore, which is 35 percent more than the ongoing one.
The planning ministry is likely to place the ADP budget proposal for the next fiscal year at the National Economic Council meeting to be held next week with the prime minister in chair. “The prime minister may increase the amount to Tk 155,000 crore at the meeting,” said a planning ministry official.
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