Budget 2019-20 – Prospect of dual focus on infrastructure and human indices

Published : Tuesday, 11 June, 2019 at 12:00 AM


Today the National Parliament will go into the budget session for 2019-20 fiscal. This will be the third session of the incumbent 11th parliament after the second. Finance Minister AHM Mustafa Kamal will place the national budget, his first, for fiscal year 2019-20 before the House on June 13 while the whole nation will be eyeing for a dynamic and progress oriented budget for the next one year. 

The current Awami League government under the leadership of Prime Minister Sheikh Hasina had presented and managed the last ten consecutive budgets which were mostly highly ambitious and development oriented and focused on collecting tax revenue as a major source of earning. This time with a new Finance Minister in chair along with being the first budget of the Awami League government’s consecutive third term, the people will look for some changes in its concept especially in terms of people orientation considering few hard facts of Bangladesh.

A lot of anticipation has been going on among the experts and analysts about the upcoming 2019-20 budget as it will set the tone for the next five years of the government. According to the finance ministry an approximate figure for this year’s budget might be around BDT 5,000 billion which is nearly 18.1 per cent of the total GDP. From different discussions, it is apparent that this year’s budget will focus on skill development, employment and human resources while will include the plans for Bangabandhu Sheikh Mujibur Rahman’s birth centenary in 2020 and Bangladesh stepping into 50 years of Independence in 2021.


The finance minister had announced that this year the GDP will exceed by more than 8.13 per cent, the GDP goal this budget might be set at more than 8 per cent. The government is also hoping to keep the inflation rate at less than 6 per cent though from a layman’s viewpoint, the inflation rate has been much higher in the previous fiscal years though not projected.

Employment is going to be a big part of the major issues covered in the upcoming budget that we can anticipate from various forum discussions. The government is working to ensure 100 per cent employment by 2025 which is expected to bring down the poverty rate by 16 per cent. Along with that, to address a major commitment in the Awami League’s election manifesto to urbanize the rural areas the network connectivity and digitalization sector will also be prioritized. The allocation for the ongoing mega projects are expected to be increased especially the ones in the power, roads and communication sector.


The government has finalized a BDT 2,02,721 crore annual development project (ADP) for the upcoming 2019-20 fiscal year,  giving the highest allocation to the transport sector. The ADP outlay is the highest in the history of the country. New ADP allocation size has increased by 17.18 per cent compared to original ADP and 21.39 per cent higher than the revised ADP for the current fiscal year 2018-19.

Of the total outlay, the government would generate BDT 1,30,921 crore from internal sources and BDT 71,800 crore would come from foreign sources. A total number of 1,358 investment projects and 116 technical assistance projects will be funded from the ADP. 

According to the Planning Minister, the government gave the transport or communication sector the highest priority considering the rapid implementation of Padma Bridge and its rail link projects. NEC allocated BDT 52,806 crore for the transport sector, which is 26 per cent of the total size of the ADP. The second highest allocation is for power sector which stands at BDT 26,017 crore. The physical infrastructure, water supply and housing sector received the third highest allocation of BDT 24,324 crore. Among the other sectors, education and religion received an allocation of BDT 21,379 crore; science, information and ICT received BDT 17,541 crore; rural development received BDT 15,157 crore; health, population and family welfare received BDT 13,055 crore; agriculture got BDT 7,616 crore; water resource got BDT 5,653 crore and the public administration sector got BDT 5,024 crore allocation for FY2019-20.


Besides, NEC separately approved BDT 12,393 crore ADP for state-owned autonomous organizations and corporations. 57.14 per cent of that will come from domestic sources while the rest 42.84 per cent will be attained from foreign sources.
Four very important directives came from the Prime Minister in the NEC meeting. Firstly she directed officials concerned to look into the projects not implemented in time and to find out the reasons behind their delayed implementation. This is a great problem for implementing any government projects in Bangladesh as the budget for a project increases due to delay and corruption strengthens as a by-product of these delayed projects. PM also urged the officials not to acquire crop fields for implementing development projects, a directive which can be vital to sustain the role of agriculture in our country’s economy while protecting growth of crop productivity in Bangladesh.

The Prime Minister also directed the Finance Minister to fix disputes over long outstanding value added tax (VAT) amount between the National Board of Revenue (NBR) and other government agencies like Bangladesh Petroleum Corporation (BPC) which will definitely intrigue the revenue collection if the disputes are resolved.  Lastly, the PM instructed for a publication compiling all development projects implemented by all ministries on hill districts depicting her commitment towards the development of the hill districts which was evident from her first term as the Prime Minister of Bangladesh.

Implementation of allocated budget to ADP has been a problem during the last few years which questions our efficiency of budget planning and alignment of all concerned implementing departments. 54.42 per cent ADP was implemented in the first 10 months of the ongoing fiscal year 2018-19 spending BDT 97,030 crore. It is a 3.8 per cent rise in implementation compared to the corresponding time of the previous fiscal year but still not satisfactory considering the constraints of our budget planning and revenue acquisition. The Implementation, Monitoring and Evaluation Division (IMED) in an intensive review, has detected the delay in starting project work, non-availability of project director, no feasibility studies prior to the launching of projects as major roadblocks.


The revenue target for the new budget might have been set at BDT 3778.1 billion which is almost BDT 390 billion more than the last year. The revenue target is 13.1 per cent of the GDP. The budget deficit this year is expected to be almost BDT 1,500 billion while the foreign aid might be kept at five per cent.

Though we might not know for sure if the government is going to have any policy indication in the upcoming budget, but simple and clear provisions should be made to turn black or undisclosed money into white. It is because, corruption, the most dangerous problem of Bangladesh, cannot be eliminated from the system anytime soon and if that money is laundered and utilized in foreign countries, then there will be no benefit for our nation. 

Moreover, as the government is focusing on VAT, they should also attach VAT with social security of the citizens when they require – after their retirement or when unemployed as that would promote willingness of citizens to pay VAT. Though social security has been established in many forms like; for elderly people, for autistics, for widows, for freedom fighters etc., the perimeter of social security should be increased. With our progress, difference between the rich and the poor is inclining and if social security is not ensured for the poor, then the risk of terrorist and fundamentalist act will reach new heights as it is easy for organizations like ISIS to get their works done by people who has nothing.


The government should also focus on collecting revenues from thousands of small and online businesses. Initially to encourage the new entrepreneurs, tax should not be imposed for five years of operations. From the sixth year, a moderate amount of tax should be imposed. This will help in two ways – expansion of revenue collection criteria by utilizing a promising sector and creation of regulatory control over these businesses which often generates cases of frauds leading towards customer dissatisfaction.

The environment of Bangladesh is suffering from several hazards especially in the city areas. Already huge environmental damages are visible. To fight this silent phenomenon, significant budget should be allocated. The environmental issues should be addressed with utmost priorities and no work in this regard should be stopped for lack of funding. If we cannot protect the environment, we will turn into an unhealthy nation soon.

Though education and religion received the fourth highest allocation in budget, the government should focus on education from a diverse angle which must focus on skill development. Future oriented educational institutes should be established at different locations of the country so that the future generation of Bangladesh can generate maximize profits from the development of this country which is promised in Vision 2021 and 2041.

It is praiseworthy that the government is expected to focus of skill and human resource development to create employment which will definitely create entrepreneurial opportunities as well as will take Bangladesh forward in terms of improvement in human indices embedded in the sustainable development goals. But along with that, the budget should not create any undue pressure on the citizens considering the huge inflation, rise in living cost and greater hassles in availing public services.

This budget should adopt more of a long term approaches rather than short term approaches of collecting revenues which are not utilized properly and mostly expensed towards corruption. But keeping aside all anticipations, it is now time toward embracing the new budget which we believe will take us one step closer to realize Bangabandhu’s dream of ‘Golden Bangla’.

The writer is Chief Editor at Mohammadi News Agency (MNA), Editor at Kishore Bangla and Vice-Chairman, Democracy Research Center (DRC)

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