ADP implementation in Q1 lowest in 8 years
In the first three months of the fiscal year, the ADP implementation stood at only 7.50%, according to IMED.
Bangladesh's development budget implementation rate fell below 7.5% in the first quarter of the current fiscal year 2023-24, the lowest in eight years, according to the Implementation Monitoring and Evaluation Division (IMED).
In the FY16, the government's actual Annual Development Programme (ADP) expenditure rate during the first quarter was 6.74%. Since then, the ADP expenditure rate in the first quarter has consistently been more than 8% each fiscal year, with some years even exceeding 10%.
The IMED's latest report shows that the government has spent only Tk12,537 crore or 7.42% of the Tk1,69,000 crore development budget allocated for the first quarter, which runs from July to September. Experts say the decline in implementation is due to a combination of factors, including the current economic situation, which has led to government austerity measures, and the upcoming national elections, which are diverting attention away from development projects.
"The government is currently facing a tight fiscal situation," said Dr Mustafa K Mujeri, former director general of the Bangladesh Institute of Development Studies. "It is prioritising spending on essential services, such as law and order and election-related activities."
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In addition, contractors are hesitant to start new projects because of concerns about whether they will be paid on time. "There is a lack of trust between the government and contractors," said Mujeri.
The IMED report shows that 27 ministries and divisions have spent less than 7% of their allocated budget. These include key ministries such as power, health, shipping, education, and science and technology.
On the other hand, some ministries and divisions have made progress in implementing their budgets. These include the local government division, the railways ministry, the civil aviation and tourism ministry, and the agriculture ministry.
The government has set a target of spending Tk94,000 crore in foreign aid during the current fiscal year. However, only Tk7,500 crore has been spent so far, a utilisation rate of 7.98%.
The report also shows that 20 ministries and divisions have spent less than 5% of their foreign aid. These include the water resources ministry, the shipping ministry, the bridge division, the secondary and higher education division, the prime minister's office, the agriculture ministry, and the primary and mass education ministry.
The government has said that it is committed to implementing its development budget on time. However, experts say that the current economic and political situation will make it difficult to achieve this goal.
State of most-allotted ministries and departments
The officials of IMED feel that the implementation rate of several ministries and departments, which received 79.83% of the total ADP allocation, is disappointing. The development budget implementation rate of the Ministry of Shipping is only 1.59%. The largest project of the country — Rooppur Nuclear Power Plant — is being constructed by the Ministry of Science and Technology. The ADP implementation rate of this ministry is 3.88%. Besides, the Health Services Division implemented 4.45% of the ADP.
However, some ministries and departments registered over 10% ADP implementation rate. Local Government Department has been able to spend 10.94%, Ministry of Railways 14.87%, Ministry of Civil Aviation and Transport 16.15% and Ministry of Agriculture 12.22% of the ADP allocation.
