Only high-priority projects this fiscal year | The Daily Star
12:00 AM, August 18, 2020 / LAST MODIFIED: 02:02 AM, August 18, 2020

Only high-priority projects this fiscal year

Govt instructs ministries and divisions

The government has directed ministries and divisions to pick high-priority projects from the list of the unapproved schemes in the annual development programme as development work has been hamstrung by revenue shortage caused by the coronavirus pandemic. 

The country would require Tk 924,203 crore to implement all of the 1,626 ongoing development projects. The government has, however, allocated Tk 204,144 crore for ADP this fiscal year.

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"At the current pace of allocation, it would take more than five years to implement the projects," said the planning ministry in a report.

The government has allocated Tk 495,097 crore as of June for the ongoing development projects included in the ADP.

There is a huge difference between the need for financing and the fiscal space, the report said.

The report was presented at a meeting of the secretaries on 10 August.

Planning Minister MA Mannan convened the meeting to prepare a roadmap to ensure full implementation of the ADP this fiscal year after development expenditure fell to a 27-year low last fiscal year.

The ministry said a limited number of projects should be undertaken for the sake of planning and fiscal discipline while adopting a project.

There are 1,347 projects in the current ADP that have not secured any allocation yet.

Most of the times, projects are undertaken without a proper feasibility study and technical design, ignoring instructions from the Executive Committee of the National Economic Council (Ecnec) to do so. As a result, the schemes go through revisions for a number of times during the implementation period.

Sometimes, projects are taken up because of the pressure from influential groups or politicians and only a small amount is allocated for them every year, said an official of the planning ministry.

"It would not be appropriate to prepare a project for approval if it is undertaken without a feasibility study and technical design," the report said.

A feasibility study may be carried out before a ministry or division initiates an investment project. The ministry or division may approve a feasibility study involving up to Tk 5 crore.

Sometimes, the project is scaled down and then it gets approval.  Later, initiatives have to be taken to revise it when its scope expands during the execution phase.

As a result, ongoing projects are not complete as per the schedule and the progress of the work is interrupted, depriving the people of benefiting from them.

If the cost of projects goes up, it would be logical to implement the approved projects within the deadlines before undertaking any new ones, the report said.

The planning ministry has written to all ministries and divisions, instructing them to take steps to classify the projects as high, medium and low priority.

The ministries and divisions may only assess the high priority projects by taking into consideration the required assets or liabilities of the ongoing projects and the projection on the mid-term budgetary framework.

The ADP has targeted to finish off 381 projects in the fiscal 2020-21.

An inter-ministerial meeting can be called in November or December to ensure adequate or increased financing to complete the projects, the planning ministry report said. 

Some 317 projects were up for completion in the last fiscal year. Of them, 137 projects could not be finished because of the coronavirus pandemic.

As per a decision of the NEC, the deadline of the unfinished projects has been expanded by a year under special consideration and they have been included in the ADP for the current fiscal year and were allocated funds.

The planning ministry has directed the ministry and divisions to take measures to ensure adequate funds for the projects.

According to the planning ministry, foreign aid use is important for the overall progress of the ADP.

But foreign aid allocation has gone down in the revised ADPs in the last few years as ministries and divisions could not use them properly.

The government allocated Tk 73,078 crore from foreign aid in favour of 376 projects this fiscal year. 

The planning ministry advised the ministries and divisions to beef up the monitoring to execute aid-backed projects in fiscal 2019-20.

If the secretaries or senior officials of ministries or divisions pay regular field visit, it would play an important role in ensuring proper implementation and quality of projects, the report said, adding that the heads of implementing agencies and project directors should intensify regular inspection and monitoring.

The recommendations made by the Implementation Monitoring and Evaluation Division in its report should be followed properly, the report said.

Development activities came to a screeching halt after the government was forced to implement a countrywide shutdown from 26 March to rein in the rising COVID-19 caseload in Bangladesh.

The ministries and divisions managed to spend Tk 161,857 crore in fiscal 2019-20, which was 80.5 per cent of the total allocation for the year.

The development budget for this fiscal year is Tk 205,145 crore, which is 6.3 per cent higher than last year's.

The government's fiscal space has squeezed as the coronavirus-induced countrywide shutdown has paralysed the economy. Revenue collection in the just-concluded fiscal year dropped 2.3 per cent.

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