Development spending slower than last year

The civil aviation and tourism ministry has been the 14th largest recipient of the development budget this fiscal year but it has managed to spend only 1.92 percent of the allocation from July to November.

The ministry received Tk 3,821 crore for 2019-20 from the Annual Development Programme (ADP), of which Tk 2,500 crore came from the foreign aid portion. But the ministry is yet to spend a single penny from the portion.

The civil aviation and tourism ministry is not alone, as many other ministries and divisions could not utilise the foreign aid. Even some ministries have not been able to use the government’s own fund.

As a result, the implementation of the development budget declined in percentage of allocation this year compared to that last fiscal year.

In total, the line ministries spent Tk 41,387 crore from July to November, which is 19.24 percent of the allocation, data from the Implementation Monitoring and Evaluation Division showed.

The utilisation was 20.15 percent during the same period last fiscal year when Tk 36,438 crore was spent.

This year the use of foreign aid dropped both in percentage and amount.

Foreign aid use fell 14.52 percent in the five-month period although the government has set an ambitious target of raising spending from foreign sources.

Between July and November, Tk 11,087 crore was utilised, which is 15.44 percent of the total foreign aid allocation.

At this point last year, foreign aid utilisation was Tk 12,971 crore, which was 21.62 percent of the allocation in 2018-19.

The government has targeted to spend Tk 71,800 crore, or more than $8 billion, in foreign aid in the fiscal year to implement the development budget.

Although the foreign aid commitment rises every year, the government can not spend much. As a result, unused foreign aid is piling up every year.

Foreign aid in the pipeline surged to a record $48.11 billion at the end of 2018-19.

However, the spending from the government’s own coffer rose 37.89 percent year-on-year to Tk 29,254 crore from July to November. The expenditure was 22.34 percent of the allocation from its own source.

The ministries and divisions spent Tk 21,214 crore during the same five-month period last fiscal year, which was 18.77 percent of the total allocation.

The railways ministry used 7.6 percent of the allocation, the industries ministry 2.34 percent, the shipping ministry 6.50 percent, and the public security division 6.71 percent. Fund utilisation by state-owned enterprises was also low, as they managed to spend half of what they had spent a year earlier.

The SoEs expended Tk 1,046 crore from July to November, which was 8.44 percent of the allocation. They used Tk 2,253 crore, or 28.63 percent of the allocation, during the same period a year ago.

The government has allocated Tk 215,114 crore for the ADP in the current fiscal year.