Govt approves Tk 1598b projects amid funding constraints

FHM Humayan Kabir The government has approved 74 new development projects involving a total expenditure of Tk 1598 billion during last four and a half months of the current fiscal, despite funding constraints now being faced to implement earlier approved plans of an on-going nature. The Planning Commission (PC) has been approving the development projects frequently, sometimes on political consideration, though the on-going ones are facing the problem of fund shortage for their implementation. The Executive Committee of the National Economic Council (ECNEC) has so far approved 74 projects involving an estimated aggregate cost of Tk 1598.29 billion in its 10 meetings between July and mid-November this fiscal 2011-2012, according to the sources in the Planning Commission (PC). Out of this aggregate estimated amount of fund on account of fresh approved proj ects, the government has to provide nearly Tk 840 billion as budgetary allocation from its own resources and the rest of the amount are projected to come in the form of foreign loans and grants. Meanwhile, the existing fund shortage problem has already impacted adversely the process of implementing 1039 on-going projects under the Tk 460 billion Annual Development Programme (ADP) of the current fiscal 2011-12. Their implementation has markedly been slowed down for want of fund alone. The PC has been failing to ensure the availability of adequate funds to some ongoing projects that required more funds than what were allocated to them, for their completion in time, officials admitted. According to PC, the 1039 ongoing projects under the ADP will require nearly Tk 690 billion along in the current fiscal but the government has allocated only Tk 460 billion for such projects. "Many times we face pressure to approve projects. Some ministries and lawmakers try to influence the Commission to endorse the projects. They are in no mood to consider the situation about resource constraints of the government," a top Commission official said. The government borrowed nearly Tk 190 billion funds from the banking system in last four months (July-October) of the current fiscal to meet the deficit in its ambitious Tk 1.64 trillion national budget. General Economics Division (GED) Member Prof. Shamsul Alam said since the government is facing a severe funding problem, the PC is very much cautious about approving fresh projects. "We have taken the fund constraints into account and are going ahead carefully to approve the new projects. We are aware of the ongoing challenge of the government," he said. Under the Tk 460 billion ADP of the current fiscal year (FY), only an amount of Tk 10.77 billion fund has been set aside for financing fresh projects that will be approved within FY 2011-12. Another senior PC official said between July and middle of November of this fiscal, the ECNEC in its 10 meetings held so far, approved 74 projects with an estimated aggregate cost of Taka 1598 billion. Such projects will require huge funds to complete in time, he stated. Besides, the ECNEC will approve more fresh projects in the remaining seven and a half months' time of the current fiscal, in which case more fresh funds will be needed to implement those projects, he said requesting for anonymity. "It will be a very challenging time for the government as it will be almost impossible to provide for the required amount of funds for both ongoing and fresh projects due to the fund constraints," the official added. Yet another PC official said: "Some ministries, especially that of communications, put pressure on the PC to approve their fresh projects. Some ministries and lawmakers always try to influence the Commission to endorse the projects." During the last four and a half months of the current fiscal, the government approved or revised some projects including those of Bangabandhu Safari Park, 'one house one farm,' primary education development etc., not purely on economic consideration, despite having its own funding constraints, he said.