Amid the country's persisting economic downturn, the government has proposed a cut in the national budget for the outgoing fiscal year (FY) 2024-25 by Tk 530 billion to Tk 7.44 trillion.
Although the overall budget outlay is going to be reduced due to a significant cut in the development expenditure, the operating expenditure target is being enhanced in the revised one, the newly-released budget documents showed on Monday.
The proposed reduction is expected to ease pressure on the government by lowering its borrowing needs from both domestic and external sources.
The revised budget deficit is estimated at 4.1 per cent of the GDP, down from 4.6 per cent in the original budget for the outgoing fiscal, Finance Adviser Dr Salehuddin Ahmed made the announcement while unveiling the revised budget.
During the July-March period of the current FY 2025, the government spent Tk 3.87 trillion, the Ministry of Finance (MoF) data show.
In the current FY2025 budget, an income deficit of Tk 2.56 trillion was projected which has been revised down to Tk 2.26 trillion, 4.1 per cent of GDP. The finance minister of the ousted Sheikh Hasina government in June last year proposed a budget of Tk 7.97 trillion in parliament, with a projected deficit of Tk 2.56 trillion.
"Considering the progress of expenditure until March, I propose to reduce the government expenditure by Tk 530 billion, setting it at Tk 7.44 trillion. Of this, I propose to cut the size of the Annual Development Programme from Tk 2.65 trillion to Tk 2.16 trillion," said Dr Ahmed.
Of the revised budget expenditure target, the allocation for Annual Development Programme is proposed at Tk 2.16 trillion by reducing Tk 490 billion from the original allocation of Tk 2.65 trillion.
In the revised Tk 2.26 trillion budget deficit, some Tk 1.17 trillion is proposed to be financed from domestic sources and Tk 1.09 trillion will be financed from the foreign sources.
Meanwhile, the operating budget has been proposed to be raised to Tk 4.82 trillion, up from Tk 4.36 trillion in the original budget.
On the other hand, the development expenditure is set at Tk 2.315 trillion, down from Tk 2.814 trillion in the original outlay.
The 'miscellaneous expenditures' has also been reduced significantly to Tk 295.25 billion in the revised budget from Tk 465.64 billion in the original budget allocation.
On the other hand, the income for implementing the national budget has also been reduced as the National Board of Revenue (NBR) and other government systems have failed to achieve the target in recent months.
The income target from taxes has been trimmed down to Tk 5.18 trillion in the revised budget from Tk 5.41 trillion original targets.
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