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Meetings with ministries, divisions start tomorrow

Foreign aid budget for next FY

FHM Humayan Kabir | February 23, 2021 00:00:00

The government has started work to prepare foreign aid budget for the next fiscal year (FY) 2021-22 as it is set to sit with all the ministries and divisions from tomorrow (Wednesday), officials said on Monday.

The Economic Relations Division (ERD) would consult with all the ministries and divisions from February 24 to March 4 aimed at framing the external aid-supported budget, they added.

The ERD had already requested the secretaries of the ministries and divisions to take part in the meeting with realistic budget demand from external resources of the upcoming fiscal year.

"We've requested all the secretaries to take part in the consultations with their fund requirements from external resources in the upcoming national budget. After the meeting, we will get an idea about total requirements of the ministries," a senior ERD official told the FE.

Since the external fund was in the pipeline, he said, they were hopeful of getting realistic fund demand against different projects from the ministries.

The government has also started work to frame the Annual Development Programme (ADP) for the upcoming FY2022.

In the ADP, the government usually provides funds from its internal resources as "GoB fund" and from external resources as "project aid".

Development partners including the World Bank, Asian Development Bank, Japan, Islamic Development Bank, China, UKAID, USAID, United Nations, Germany and Russia provide project aid (foreign assistance) for bankrolling development projects under the ADP.

In the current FY2021, the government framed a Tk 2.14 trillion ADP under which Tk 705.02 billion fund had been allocated as project aid.

The ERD has already revised the foreign aid outlay in the current ADP, cutting the allocation to Tk 630 billion as the ministries and divisions had failed to spend earmarked foreign assistance on development projects.

It had sent the downsized fund allocations to the Planning Commission for finalising the RADP for the current FY. The RADP is expected to be finalised by next month.

"We will sit with the Power Division and some other ministries on the first day of our consultations on February 24," said another ERD official.

He said they would sit with all the ministries and divisions gradually until March 4 and would discuss fund requirements for the next FY2022.

"After the consultations, we would finalise the foreign aid outlay in the upcoming ADP. Then it will be sent to the Planning Commission for finalisation of the next ADP," he added.

In the consultations, they would try to encourage the ministries and divisions to spend the huge foreign aid in the pipeline in a bid to expedite the development works of the country, the ERD official said.

Meanwhile, Bangladesh's total undisbursed foreign aid in the pipeline ballooned to US$48.23 billion till December last as many state agencies failed to utilise external assistance, the ERD data showed.

Despite commitment of foreign aids by different development partners against several projects and programmes, undisbursed assistance in the pipeline is surging mainly due to failure of the external fund use in time, ERD officials said.

In the current FY2021 ADP, the government agencies spent only Tk 200 billion, 28.39 per cent of the total Tk 705.02 billion project aid outlay in last seven months (from June 2020 to January 2021).

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