ADP spending drops to Tk41,877cr in H1 FY26, lowest in eight years

Spending under the Annual Development Programme (ADP) stood at Tk41,876.88 crore during the first six months of the fiscal year 2025–26, from July to December, marking the lowest level in the past eight fiscal years.

Infograph: TBS

The ADP spending in the first half of the current fiscal year was even lower than the same period of the fiscal year 2024–25, when ministries and divisions spent Tk50,002 crore despite political unrest, the fall of the government and administrative instability.

Compared with the first six months of the previous fiscal year, ADP spending in the current fiscal year has declined by Tk8,125 crore.

ADP spending during the first six months of the fiscal year 2023–24 stood at Tk61,739.69 crore.

The information was revealed in a report published today by the Implementation Monitoring and Evaluation Division (IMED).

ADP implementation rate remains weak

According to IMED data, 17.54% of the total ADP allocation for the current fiscal year was spent in the first six months. The rate was 17.97% in the same period of the previous fiscal year.

In the first half of the fiscal years 2023–24 and 2022–23, ADP implementation rates stood at 22.48% and 23.53% respectively, IMED said.

In the current fiscal year, the total ADP allocation, including funds for autonomous bodies, was Tk2,38,695.64 crore.

Contractors yet to return after political transition

Officials of the IMED said that during July–August of the previous fiscal year, the country went through mass student protests that led to the fall of the Awami League government.

They said development activities had almost come to a halt during that period. However, officials said ADP implementation was expected to return to a normal pace this year. In reality, no such momentum has yet been seen.

IMED officials said many contractors who left project sites after the fall of the previous government have not returned, largely due to political reasons. As a result, work on many projects remains stalled.

They also said construction work on several projects was delayed due to the approval process under the new public procurement rules, which has affected overall ADP implementation.

Planning adviser cites structural bottlenecks

After a meeting of the National Economic Council (NEC) on Monday, Planning Adviser Wahiduddin Mahmud explained the slow pace of ADP implementation and the reduction in the size of the revised ADP at a press conference.

He said several structural issues were behind the slowdown. "After the change in government last year, many project directors could not be found, while some stepped aside following corruption allegations. Appointing new project directors also took time," he said. 

The planning adviser said many projects had to be revised, which delayed the resumption of work. "Ministries and divisions took time to move forward with tenders under the newly approved government procurement rules," he added. 

Due to these factors, project implementation slowed, and demand for allocations under the revised ADP also declined, he said.

Stricter project approval slows implementation

Wahiduddin Mahmud said the interim government has introduced stricter conditions for approving new projects.

"Project authorities are now required to submit progress and quality reports at regular intervals, while large construction projects must undergo mid-term reviews by independent experts," he said. 

As a result, he said, the pace of implementation has slowed to some extent.

The planning adviser said several projects have had their development project proposals revised, reducing costs by between Tk1,000 crore and Tk3,000–4,000 crore without affecting project effectiveness.

"A cautious approach has been adopted in some cases. For projects such as Payra Port and the metro rail, it was considered reasonable to move forward in phases after reviewing performance and past experience," he said. 

Revised ADP approved earlier than usual

Wahiduddin Mahmud said recent political instability has also affected implementation, while lower demand for funds under the ADP reflected the slower pace of work.

"Meanwhile, due to the decline in ADP implementation in the current fiscal year, the government has moved ahead with revising the ADP earlier than usual," he said. 

In a normal fiscal year, revisions to the ADP are finalised in February or March. Considering the situation, the government finalised the revised ADP in January this year, he added.

At a meeting of the National Economic Council (NEC) on Monday, the government approved a revised Annual Development Programme (RADP) for the current fiscal year after cutting the original allocation by 13.04%.

Under the revised plan, the ADP allocation was set at Tk2,00,000 crore, which is Tk30,000 crore less than the original ADP allocation. Including projects funded from the government's own resources, the total size of the revised annual development programme (RADP) now stands at Tk208,935.53 crore.

Smaller ADP, lower spending in taka terms

Former planning secretary Md Mamun-Al-Rashid told The Business Standard that the overall size of the ADP in the current fiscal year is slightly smaller than last year.

"Because the size of the ADP is smaller this year, even if the implementation rate remains similar, the amount of money spent will naturally be lower," he said.

He said development activities tend to slow down in election periods, and the current situation reflects that pattern.

"At the moment, almost everything is election-focused. As a result, development activities have slowed, which is clearly visible," he said. "The biggest negative impact of this slowdown is on employment, as development projects create large-scale job opportunities and have strong multiplier effects on the economy."

He said special measures should be taken in the remaining months of the fiscal year to speed up ADP implementation.

Health, rail, roads among slowest implementers

Meanwhile, an IMED report showed that Tk23,599 crore was spent from government funds in the first six months of the fiscal year, accounting for 16.39% of the allocation.

In the same period of the previous fiscal year, spending from government funds stood at Tk26,130 crore, or 15.84% of the allocation, the report said.

During the July–December period of the current fiscal year, Tk15,981 crore was spent from foreign loans and grants, which accounts for 18.58% of the allocation. In the same period of the previous fiscal year, spending from foreign sources stood at Tk19,609 crore, or 19.61%.

In the first six months of the current fiscal year, Tk2,297 crore was spent from the own funds of implementing agencies. In the same period last year, spending from agencies' own funds amounted to Tk4,264 crore.

In the current fiscal year, 15 ministries and divisions received 74.56% of the total ADP allocation. Overall ADP implementation largely depends on the progress of projects under these ministries and divisions.

Among the ministries and divisions with the highest allocations, ADP implementation remained low in several sectors during the first six months. The implementation rate stood at 2.33% for the Health Education and Family Welfare Division and 6.11% for the Health Services Division.

During the same period, the Railways Ministry spent 9.79% of its allocation. The Roads and Highways Division spent 12%, the Secondary and Higher Education Division 13.22%, the Power Division 16.96%, the Primary and Mass Education Ministry 17.98%, and the Shipping Ministry 18.82%.

Among the top allocation recipients, the Ministry of Science and Technology recorded the highest ADP implementation rate at 35.81%. The Water Resources Ministry implemented 31.17% of its allocation, while the Local Government Division recorded an implementation rate of 30.65%.

Other ministries showed moderate progress, with the Energy and Mineral Resources Ministry implementing 27.69% of its allocation, the Bridges Division 23.13%, the Housing and Public Works Ministry 23%, and the Agriculture Ministry 19.97%.