CPD analysis: Budget lacks well-crafted action plan
Sayeed Muhammad: The Centre for Policy Dialogue or CPD, a leading think tank of Bangladesh, said the proposed budget for the fiscal year (FY) 2018-19 lacks clarity about the source of fund and expenditure. According to the CPD, the projected revenue target is unrealistic and there is no clear guideline over the source of the funds for implementing the budget. It also claimed that the proposed budget has increased benefits and allowances for the poor and taken some small projects ahead of national polls.
The organisation made the reaction just a day after Finance Minister AMA Muhith presented the Tk 4.65 trillion budget, 25% more than the revised budget and more than 16% higher than the original budget of the outgoing fiscal year. “The government has taken up these projects with the election in mind,” said Professor Mustafizur Rahman, distinguished fellow at the CPD. The budget proposed higher indirect tax than direct tax, which will put pressure on the middle-income group than the higher-middle income group who are expected to finance the election, according to the CPD. Debapriya Bhattacharya, another distinguished fellow at the CPD, said: “It’s an archaic budget for a young Bangladesh.” The budget for fiscal 2018-19 has maintained a status quo as it focuses more on reviewing the past than the future, the CPD said in a report. The CPD said the budget lacks sensitivity towards existing and emerging macro stresses, including pressure on balance of payments and exchange rate, inflationary expectations, as well as scant attention to areas requiring reforms.
Moreover, no well-crafted action plan is there to implement the budget, strengthen revenue collection, deliver public expenditure, raise allocative efficiency, improve expenditure efficacy, and even to pursue the deficit financing programme.