Govt sets Tk 193.95b aid target for next budget

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FHM Humayan Kabir
The government has set a Tk 193.95 billion foreign aid target for the upcoming national budget aimed at executing different development works, especially increased investment in the power and energy sectors, officials said Wednesday.
Finance ministry officials said the expected foreign resource is Tk 18.65 billion higher than Tk 175.30 billion total aid targets in the current financial year's budget.
The Economics Relations Division (ERD) under the finance ministry has framed the aid target for the next fiscal year, which starts in July 2010 and ends in June 2011.
"The finance minister has approved the external resources target for the next budget Wednesday. Now we will send the project aid budget to the planning ministry to finalise the annual development programme," a senior ERD official told the FE.
The official said: "We expect Tk 193.95 billion external resources will be mobilised from foreign loans and grants. Out of the money, Tk 153.00 billion will be invested to implement development projects under the ADP."
The government usually takes loans and grants from different bilateral and multilateral donors to complete the country's development works as its domestic resources cannot meet the entire fiscal expenditure.
Out of the total expected foreign assistance in the next budget, the government will mobilise Tk 153.00 billion funds as project aid, Tk 5.95 billion as food aid and Tk 35.00 billion as special budgetary support credit from the donors working in Bangladesh.
The ERD official said some ministries like the communications sought more foreign fund allocations in the next financial year, especially for the proposed Padma multipurpose bridge project.
"Initially we have proposed Tk 5.00 billion allocations for the Padma bridge in the project aid component of the next budget. But the communications ministry sought Tk 25 billion for the next year," he added.
We are hopeful that if the Padma bridge construction starts in full swing in the next fiscal, the targeted foreign aid would have to be revised upward after a few months into the next fiscal.
In the current budget, the government expected Tk 120 billion as project aid, Tk 49 billion as budgetary support credit and Tk 6.30 billion as food aid from different bilateral and multilateral donors.
Bangladesh in first three quarters (July-March) of the current fiscal year 2010 has received foreign assistance worth US$ 1.50 billion (Tk 105 billion) against the annual target of $2.50 billion (Tk 175.30 billion).
We are expecting increased aid in the next financial year as the Asian Development Bank has assured of giving more than one billion dollars assistance in the next fiscal year, the first time in the country's history, against different projects, the ERD official said.
He said in addition, the largest bilateral donor Japan and the biggest multilateral lender World Bank have also assured of increased support in the next financial year of 2011 due to Bangladesh's higher demands in infrastructure development.
Besides, as the next national budget will be crucial to the prevailing power and energy crisis and the impact of the global economic slump on the national economy, the government would welcome further support from the donors for meeting the deficit expenditure, the official added.