Govt goes for a slim ADP to fight inflation

The government yesterday approved a Tk 2,65,000 crore Annual Development Programme (ADP) for the next fiscal year to address high inflation.

The National Economic Council (NEC) at a meeting chaired by Prime Minister Sheikh Hasina approved the ADP for the 2024-2025 fiscal year, which shows an increase of only 0.76 percent from the current one.

After the meeting, Senior Secretary of the Planning Division Satyajit Karmaker told reporters that to keep inflation at a tolerable level, the government fund has been reduced in the new ADP, with an aim to ensure coordination between the fiscal and monetary policies.

On the other hand, the foreign fund allocation in the ADP has been increased to a record Tk 1,00,000 crore at a time when the country is under pressure due to the bleeding of reserves.

"Usually, we increase the ADP size by Tk 20,000 crore to Tk 22,000 crore each fiscal year. This time, the increase is only by Tk 2,000 crore," said Satyajit.

In the new ADP, the government fund will be Tk 1,65,000 crore, down by 2.37 percent, while the foreign fund allocation will rise by 6.38 percent or Tk 6,000 crore.

At the NEC meeting, the prime minister gave directives to make additional efforts while utilising foreign loans in the ADP, said the senior secretary.

She also directed the ministries concerned and the Implementation Monitoring and Evaluation Division to submit reports every three months to the NEC on the utilisation of foreign loans.

The country's inflation has been above nine percent since March last year despite various government efforts to tame it.

Moreover, despite several steps from the government and Bangladesh Bank, forex reserves have been declining over the past two years.

BB's latest statistics show the country's gross international reserves as per the IMF method came down to $18.43 billion on May 15.

At a post-meeting briefing, Planning Minister Abdus Salam said a key decision regarding undertaking new projects has been made.

He said that from now on, the government will not undertake any upazila-based small project and will take district-wise projects instead.

Salam added that members of parliament would be engaged in framing the district-wise five-year participatory master plan for the districts, and even the upazila chairmen will be involved in the process.

The minister also said more development operations would be conducted in the areas of rural infrastructure, health, education, and communication.

He added that filtering in project selection is much stronger now with no unnecessary or meaningless project being taken up.

State Minister for Planning Shahiduzzaman Sarker said the government's project implementations often face problems regarding land acquisition and they have been working to solve such problems.

Senior Secretary Satyajit said the PM has also directed the officials to establish a pool for the project directors and they will be included in the pool after necessary training. She said even if a physician wants to be a project director, they must undergo training.

Besides, she also directed that if any organisation wants to conduct feasibility studies for a project, they have to be registered, he said.

In the ADP, the transportation and communication sectors will get the highest allocation -- Tk 70,687 crore (26.67 percent) -- followed by the power and energy sector -- Tk 40,751 crore (15.38 percent).

Education will get Tk 31,528 crore (11.36 percent); housing and community facilities Tk 24,868 crore (9.38 percent); health Tk 20,682 crore (7.80 percent); and local government and rural development Tk 17,986 crore (6.79 percent).

Besides, the agriculture sector will get Tk 13,219 crore (4.99 percent); environment Tk 11,089 crore (4.18 percent); industry and economic service Tk 6,492 crore (2.45 percent); and science and information technology Tk 4,786 crore (1.25 percent).

Yesterday's meeting also approved a Tk 13,288 crore development budget for state-owned enterprises.