The budget of the current fiscal might also be downsized by about five per cent bringing it down from Tk 64,383 crore to Tk 61,200 crore.

The four-party alliance government's last budget will be placed in parliament on June 8. The finance ministry has worked out the budget size, but there might be some last minute changes.

The country will have three governments in FY07. The present government will continue in office until October 2006, a caretaker government will be at the helm for the next three months and finally a newly elected government will take over.

Amid such quick succession of changes, sources said, it is very likely that both revenue growth and foreign aid inflow will slow down in the next fiscal. Even in the current fiscal, about 15 percent of the targeted revenue growth might be achieved, instead of the desired 17 percent, the National Board of Revenue (NBR) sources said.

The ADP size in the national budget for FY 06-07 has been set at Tk 26,000 crore and the National Economic Council (NEC) has already approved it, Tk 39,000 crore in the budget has been shown as current expenditure. The rest amounting to Tk 3,600 crore has been earmarked for non-ADP development programmes and other expenditures.

Current expenditure in the original budget of FY 06 was set at Tk 36,100 crore and the figure might be kept the same in the revised budget. The portion for non-ADP development programmes and other expenditures has been reduced to Tk 2,800 crore, which is around Tk 800 crore less than the original figure.

The total revenue earning might be set at Tk 52,230 crore in the next fiscal's budget to meet the expenditure, which is about 15 percent more than the current fiscal's revenue target. NBR's contribution to the revenue has been set at Tk 41,000 crore.

In the original budget of the current fiscal the total revenue target was set at Tk 45,720 crore, which might be dropped to Tk 44,570 crore in the revised one. The portion coming from NBR was set at Tk 35,600 crore which might be brought down to Tk 34,500 crore.

NBR sources however said even the revised target for the current fiscal might not be achieved. That is why a moderate target has been set for the next fiscal. The sources added that the next fiscal will be transitional, which once again will not allow the government to set an ambitious target.

As a result, an overall deficit to the tune of Tk 16,300 crore will have to be met. The government plans to finance Tk 9,000 crore from domestic borrowing and the rest will come in the form of foreign aid to meet the deficit.

Over the last several years, foreign aid as development support credit and education support credit have greatly helped the government to realise its budgets. But, there is now an uncertainty about getting those credits in FY07, since foreign aid inflow has already started to nosedive.

The country's four major development partners including the World Bank and Asian Development Bank have committed to provide about $6 billion for full-fledged implementation of the strategic poverty reduction programme over the next four years. But as the government is unlikely to fulfil the conditions to qualify for the aid, it might not get the full tranche earmarked for Fy07.