Hefty subsidy to create challenge for budget management: Kamal

A hefty amount of subsidy allocated by the government to offset the price increases in the global market may pose a challenge in the budget management for the next fiscal year, said Finance Minister AHM Mustafa Kamal today.

There is pressure on subsidy and incentives management by the government, he said.

The allocation for subsidy and incentive expenditure was Tk 53,852 crore for FY22.

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Importing aircraft to become cheaper

But due to the rise in prices of fuel and fertiliser in the international market, the government had to increase subsidy and incentives expenditure on fuel, electricity, gas, and fertiliser.

As a result, the estimates of subsidy and incentives expenditure on the revised budget of FY22 had to be increased to Tk 66,825 crore, which 1.70 percent of GDP.

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Tourism industry gets Tk 1,000 crore incentive

This expenditure has been increased to Tk 82,745 crore (1.90 percent of GDP) in the initial estimate of the budget for FY23.

However, considering the price trend of oil, gas, and fertiliser in the global market, the estimated subsidy and incentives spending can be 15-20 per cent higher than the initial estimates.

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Cars, motorcycles to cost more