Muhith for raising flow of foreign aid

Finance Minister AMA Muhith stressed the need for raising the flow of foreign aid disbursement for enlarging the size of the national budget in keeping with greater demand of the present day.
"Our pipeline of aid is too big--it's about US$24 billion. In comparison, disbursement is very little," he told newsmen after a pre-budget parley with secretaries of different ministries at the Secretariat.
He said: "Increase in aid disbursement will help make the size of budget bigger. The present size of budget could be substantially higher if aid flow is increased."
Mr Muhtih said presently some $24 billion foreign aid is in the pipeline. "We will get nearly $4.8 billion if only 20 per cent of the pledged aid is disbursed. Our target is to get foreign aid less than $4.0 billion."
Asked about the reason for slow pace of aid disbursement, he said: "Some say the procedures of donors (in aid disbursement) are lengthy.  But the fact is we are not prepared (to spend). We make aid commitment but do not remain prepared to use those immediately."
He said the International Finance Corporation (IFC) will help Bangladesh issue $1.0 billion bond on the global money market which can be used in next budget.
But if the money is not needed in budget, the private sector will be able to use it. In that case, they will have to pay interest at the rate of 5.0 per cent. The issuance of the bond may take 2/3 months, Mr Muhtih said.
He also spoke of budgetary support from the World Bank. Asked about conditions binding the aid, he said: "There are some conditions like IMF's loan. No loan is available sans condition."
He said the remaining portion of IMF's extended credit facility (ECF) funds will be available by June. Regarding the secretaries' committee opinion on the Pay Commission's report he said they are likely to submit it in a day or two.
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