Transport sector proposes 15pc dev budget cut due to execution delays

Transport sector, the country's largest recipient of development funds, has proposed surrendering a big chunk of its current budget allocation due to delays in project execution, officials said on Monday.
In the upcoming revised annual development programme, this proposed sacrifice amounts to a 15.32 per cent reduction, bringing the allocation for the remainder of the current fiscal year to Tk 349.81 billion.
The original allocation for the sector, covering agencies like the Roads and Highways Department (RHD), Dhaka Mass Transport Company Limited (DMTCL), Bridges Division and Dhaka Transport Coordination Authority (DTCA), stood at Tk 413.11 billion.
"The proposed cut by transport falls below their initial fund appetite," said a senior official from the Planning Commission (PC), which is currently scrutinising the revised budget demands. "After the review, we will finalise the revised allocations for the remaining fiscal year."
He said the transport sector's substantial budget reduction will impact overall budget execution and public investment.
This move comes amid concerns about low execution rates of development projects across government agencies, prompting the Planning Commission to revise the national development budget (Annual Development Programme or ADP).
DMTCL, the agency responsible for Dhaka's mass transit system, faces the steepest proposed cut within the transport sector. Their revised allocation would shrink by 54 per cent to Tk 37.71 billion -- down from the initial Tk 82.15 billion, according to planning officials.
The RHD, the current year's single largest holder of development funds, would surrender Tk 6.62 billion, leaving their revised allocation at Tk 242.75 billion, compared to the original Tk 236.13 billion.
Rounding out the major agencies, the Bridges Division -- another key recipient of the transport sector's budget, proposes a 14 per cent surrender, bringing their revised allocation down to Tk 75.52 billion from the initial Tk 88.20 billion.
"It is bad news for the economy as the transport sector is crucial for the country's development," commented another Planning Commission official.
"If agencies within this sector surrender available funds, it will affect government investment and the country's economic output."
While elaborating on his points, he highlighted the case of DMTCL, currently managing three simultaneous metro rail projects, which has proposed the highest fund surrender at 54 per cent.
'This surrender means the MRT projects will be slow and the people will not get the benefit from the metro rail on time," he said.
Among the three MRTs, DMTCL has requested the smallest funding adjustments for the ongoing MRT-1 and MRT-6 projects.
For MRT-1, running from Hazrat Shahjalal International Airport to Kamalapur, DMTCL proposes surrendering Tk 29.12 billion (74.5 per cent) of its current fiscal allocation of Tk 39.10 billion.
Similarly, it seeks to give up Tk 14.32 billion (42 per cent) of its current Tk 34.25 billion ADP allocation for MRT-6, connecting Uttara to Kamalapur via Motijheel.
MRT-5 (North) faces a slightly smaller reduction, as DMTCL requests 11.36 per cent less funding (Tk 7.80 billion) compared to its original Tk 8.80 billion allocation in the current ADP, said officials.
The RHD has proposed surrendering Tk 1.40 billion for a single project, the Dhaka-Ashulia elevated expressway, out of its original Tk 35.18 billion ADP allocation.
Planning Commission officials expect finalising the revised Annual Development Programme (RADP) by the end of this month.
The government agencies have only implemented 17.06 per cent of the total annual development budget between July and November 2023, falling more than 1 percentage point short of the same period in the previous fiscal year.

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