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Budget gap to widen 5.5pc in FY'20

FE Report | June 12, 2020 00:00:00

The budget deficit for the outgoing fiscal year (FY) 2019-20 has been projected to widen by 0.5 percentage points to 5.5 per cent of Gross Domestic Product (GDP) compared to the original estimates.

Finance minister AHM Mustafa Kamal, in the just-unveiled budget, revised the gap estimate for the outgoing fiscal considering the disruptions to the internal income of the government caused by the coronavirus pandemic.

In his budget speech on Thursday, Mr Kamal said, "The budget deficit for the current fiscal year was estimated at Tk 1.45 trillion. However, the deficit in the revised budget has been set at Tk 1.53 trillion, which is 5.5 per cent of GDP."

According to the revised target, the expected external financing has been reduced to Tk 561.63 billion from Tk 680.16 billion.

However, the financing from the domestic sources has been raised to Tk 973.45 billion form Tk 773.73 billion.

Among the revised domestic financing target, the government's borrowing target from the banking system has been raised to Tk 824.21 billion from the original estimates of Tk 473.64 billion. The remaining funds will be come from the non-banking sources, including sales of savings tools.

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