Bank loans to finance deficit

The government will balance the Tk 20,000 crore budget deficit -- as a result of not imposing excise duty and the flat 15 percent VAT as planned -- by taking bank loan as well as by slashing the development budget, Prime Minister Sheikh Hasina told parliament yesterday.

Parts of the money will come from other sources, she said, but did not name those sources. 

In her concluding speech on the budget session, the PM also requested the countrymen to pay taxes so that the government could serve them better.

On June 29, the House passed the Tk 400,266 crore budget after some vital changes, by revising excise duty on bank deposits and stalling the full implementation of the new VAT law for two years.

During the 24-day session that began on May 30, as many as 207 MPs took part in the budget discussion for over 56 hours. Seven bills were passed in the session.

Finance Minister AMA Muhith had come under fire in and outside parliament for his rigid stance against withdrawing excise duty on bank deposits and for proposing a 15 percent uniform VAT. Later, he revised both the plans and eventually backed away from imposing the flat VAT rate.

Referring to the lawmakers' discussions on the proposed budget, the PM said both ruling party and opposition lawmakers discussed the budget. Some ruling party lawmakers even criticised some proposals. "It is rare and it proves that everyone has freedom to express their opinion. And the finance minister changed some proposals following their [MPs] recommendations."

Now, by implementing the budget, the government will transform Bangladesh into a middle-income country by 2021 and a developed nation by 2041, she said.

Describing her government's success, Hasina said through effective measures Bangladesh became third in vegetable production, fourth in paddy and fresh water fish production, seventh in mango production, eighth in guava production and fifth in mutton production in the world.

Responding to opposition leader Raushan Ershad's concern over waterlogging in the capital, the PM blamed her predecessors for unplanned urbanisation of Dhaka.

She said construction of unplanned box culverts, filling up of rivers, canals and ponds were responsible for the city's waterlogging.

Hasina reiterated the government's “zero tolerance” policy against militancy. “There will be no room for militancy on the soil of this land. Bangladesh has been marching forward and the journey will continue.”

The PM also warned that this year's flood might be devastating. "For this, we're importing food grains and stockpiling them so that we can face any kind of calamities. The flood victims are getting enough relief materials.”