Govt repays Tk 2,754cr amid sluggish ADP

The government in July, the first month of the current fiscal year, paid back around Tk 2,754 crore bank loans although it has targeted a big amount from banks for the year.
Planning ministry officials said the government returned the loan due to a slow pace in implementation of the Annual Development Programme (ADP) at the beginning of the fiscal year.
In the current fiscal year the government's target to borrow from the banks is Tk 16,755 crore, around 57 percent higher than the previous fiscal year.
According to Bangladesh Bank (BB) statistics, the government repaid a total of Tk 4,356 crore loan from July 1 to July 29 of the current fiscal year. However it borrowed Tk 1,602 crore from commercial banks in the same period, and so the government's net borrowing from the banking system was reduced by Tk 2,754.67 crore in nearly one month.
The reduction was Tk 140 crore in the same period last year.
A central bank official said although the government has a target of borrowing a big amount from the banks, it repaid instead of taking loan at the beginning of the fiscal year because of a slow ADP implementation pace.
As the repayment is higher this time, it seems that the pace of ADP implementation is slower than that of last year, BB officials said.
The ADP size in the current fiscal year is Tk 30,500 crore. Besides, around Tk 3,000 crore has been allocated for development projects under revenue budget.
The planning ministry officials said the pace of ADP implementation usually remains slow at the beginning of a fiscal year. Information about implementation is yet to come out from the ministries. However the dynamism required in the ministries for implementing a big ADP is yet to be seen.
The size of the revised ADP was Tk 23,000 crore last fiscal year. Information about the ADP implementation for the whole year is still not available. However projects worth only Tk 14,088 crore were implemented in 11 months till May.
Officials said projects worth at best Tk 20,000 crore are likely to be implemented in the whole year.
An official of the Implementation, Monitoring and Evaluation Division (IMED) of the planning ministry said the government has taken a 'big' plan for implementing the ADP, and the ministries have been apprised of the matter.
The ministries will hold meeting on ADP implementation every month. The finance ministry will monitor the implementation progress made by other ministries. The ministries were directed to ready procurement plans in the first month of the fiscal year, the IMED official said.
Meanwhile, the central bank governor has said the ADP implementation is important to increase investment.
Talking with a group of journalists last week, the BB governor said the government should start investment right now in power and infrastructure sectors instead of waiting for donor assistance.
A seminar of the Centre for Policy Dialogue (CPD) on Wednesday was told that boosting public investment is required for faster implementation of ADP and stimulating private investment.