The debt-service liability (DSL) of the state-owned entities, autonomous and semi-autonomous bodies spiked to Tk 1.8 trillion at the end of the last fiscal (2013-14), according to official statistics.
The amount, which comprises both principal and interest, is equivalent to around 23 per cent of the gross domestic product (GDP) of the last fiscal year.
The debt-burden of these organisations includes the funds that the government borrowed from foreign development partners against projects and the local currency loans.
Sources said the state-owned enterprises (SoEs) and similar other organisations in violation of the loan agreements struck with the government have been defaulting on the repayments, leading to the swelling of their debt to the government. And the government has also never been serious about the recovery of the same.
Moreover, the records of the debts and repayments of the same used to be maintained in a very disorderly manner until recently.
The Development Accounts Cell (DAC), which is now known as Debt Servicing Liability (DSL) branch in the ministry of finance, was not automated and used to maintain records manually. It could not track the amount of foreign and local loans given to the SoEs and similar other organisations. There was no system of keeping records about repayments also. In fact, the record-keeping was in a total mess, an official admitted.
The DSL branch, which is now under the treasury and debt management wing of the finance division, has been trying to streamline the record keeping. It, however, might take a lot of time, sources said.
The government provided some 36 new loans in 2013-14 to the government-owned and similar other organisations. And the fresh lending came as one of the major contributors to the debt swelling.
The aggregate amount of principal and interest due was Tk 761.09 billion end of June 2013, according to official statistics available with the ministry of finance.
Total outstanding amount, which includes both overdue and current amount, stood at Tk 3.2 trillion on June 30, 2014. The figure was Tk 1.40 trillion a year back.
The finance division has reckoned and readied the latest figures up to last June for disclosing during the presentation of the national budget by the finance minister this coming June.
Government borrows from foreign development partners like the World Bank, the Asian Development Bank and the Islamic Development Bank.
And the finance division, on behalf of the government, lends the borrowed money to the SOEs and similar other organisations under certain terms and conditions for implementing both development and non-development projects.
Informed sources told the FE that the large
amount of loans pending with the SOEs have been causing problems for the government to strike a balance between the existing resources and the current expenditure.
They said many new sectors in need of loans hardly get the same from the government since most SoEs are not making repayments as per the loan agreements.
According to the latest figures, the DSL of the Bangladesh Power Development Board (BPDB) alone stood at Tk1.39 trillion as of FY 2013-14.
In the board's bag was Tk 411.60 billion as outstanding loan up to 2012-13. Its debt burden had significantly swelled by nearly Tk 1.4 trillion within a year. The cumulative interest on the total is compound in nature-thus snowballing every passing year.
Those familiar with the loan-disbursement process said government's expensive power purchase from the quick-rental power plants is believed to be major reason for such sharp rise in the borrowing by the BPDB.
It alone holds nearly 76 per cent of the total debt and Petrobangla comes next with Tk 94 billion. But Petrobangla's total DSL dropped to some extent in 2013-14 as it had repaid a 'large' sum of the liabilities. Its outstanding was Tk 95.6 billion up to 2012-13.
The Rural Electrification Board (REB) held a total outstanding amount of Tk 69.88 billion up to 2013-14.
Bangladesh Chemical Industries Corporation (BCIC) under the Ministry of Industries had a total DSL of Tk 63.91 billion at the same time.
Dhaka WASA owed Tk 16.7 billion, as of 2013-14, as against Tk 15.58 billion in 2012-13.
Bangladesh Petroleum Corporation's DSL surged to Tk 16.72 billion in 2013 from Tk 13.86 billion in 2012-13.
A total of 110 organisations usually receive loans from government coffers.
Sources at the Debt Service Liabilities wing of the finance division told the FE that it had taken many steps to realise the growing outstanding loans but mostly to no avail. Rather the dues are getting bloated.
They said they had met with the organisations individually for the recovery reason.
"We want to streamline the official debt- repayment process as it puts the government in a difficult position to manage its current expenditure," said a senior official at the DSL wing.
jaismharoon@yahoo.com
SOEs\\\' DSL soars to Tk 1.8t on government apathy
Jasim Uddin Haroon | Published: March 30, 2015 00:00:00 | Updated: November 30, 2026 06:01:00
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