Inadequate fund may hinder execution of dev projects

Inadequate fund allocations amid lower revenue income and foreign aid commitments are likely to affect the implementation of 96 development projects approved by the government in the first half of the current fiscal, officials said Saturday.
Officials said the government without confirming adequate fund allocations started approving development works that involve spending of a huge sum.
"Despite lower revenue growth and foreign aid commitment, the government has been approving new projects or revising the cost of old ones upward. Many priority projects are facing execution delay due to inadequate funds. In addition, endorsement of those large number of projects will affect implementation of both the current and newly approved projects," said a senior Planning Commission official.
"The development fund is limited. Besides, many ongoing priority projects have already been facing fund shortage. If the government goes for allocating even a nominal amount of funds for each of the newly approved projects, the ongoing ones will face fund shortage too," he told the FE.
So, it will affect implementation of not only of ongoing priority projects but also of new ones, the official added.
In the current financial year (FY) 2014-15, the government has taken up a Tk 803.15 billion annual development programme (ADP) and kept only Tk 14.89 billion in block allocations for providing funds to the newly approved projects.
Meanwhile, during the H1 of the current FY2015, revenue collection by the National Board of Revenue (NBR) fell short of the target by Tk 26.56 billion mainly due to failure in achieving target by VAT and customs wings of the board.
According to NBR data, the revenue board collected Tk 448.04 billion in July-December against the target of Tk 474.58 billion in the period.
The foreign aid commitment to Bangladesh has plunged by 60 per cent to US$896.6 million in July-November period compared to $1.44 billion in the same period previous FY2014 due to "go slow" in aid confirmation by some key development partners.
The foreign assistance disbursement has remained almost static with $902 million received during the first five months of the current fiscal compared to $887.3 million in the corresponding period last FY2014.
The government borrowing from the non-banks and saving certificates has surged significantly to finance the development programme.
Net sale of the national savings certificates increased by nearly 234 per cent to Tk 112.42 billion in Jul-Nov period this FY2015 from that of Tk 33.69 billion in the corresponding period of the previous fiscal.
"The government has approved some very important projects like setting up of 1200-megawatt Matarbari coal-based power plant, some gas pipeline projects, Bangabandhu Satellite installation, school feeding projects during the H1 this fiscal. What will be the fate of those projects amid the lower revenue income and foreign aid commitment?" another top PC official said.
The government during July-December period FY2015 has approved Tk 359.84 billion for 1200MW Matarbari Power Plant project, Tk 29.68 billion for Bangabandhu Satellite installation project, Tk 65.04 billion for Akhaura Lakhsam railway line project, Tk 17 billion for Bibiyana-Dhanua gas pipeline Tk 20.43 billion for Inclusive city governance project, Tk 18.34 billion for two separate power distribution projects in Barisal and Khulna.
In the current Tk 803.15 billion ADP, some 1034 ongoing projects have been included. Out of them, 324 projects will be completed within the current financial year which will end on June 30, 2015.
The government will have to allocate more money to some priority projects like Dhaka-Chittagong 4-lane, Mouchak-Moghbazar flyover, power generation and transport in the upcoming revised ADP for the current fiscal.
So, it will be difficult for the government to allocate more money for the newly approved projects, the PC official added.
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