The operational and development budget’s total expenditure for the first four months of the current fiscal year, 2024–2025 (July–October), was 1,44,470 million taka. Of this, 87,401 million taka—or roughly 61 percent of the total expenditure—went toward paying retirees’ pensions, official and employee salaries and benefits, and loan interest. During the four months, the overall budget implementation rate was 18.1%. The Ministry of Finance has released a report that includes this information.
For the current fiscal year, the deposed Awami League government proposed a budget of 7,970 million taka. That budget has been maintained by the acting administration, which was appointed on August 8 and is headed by Professor Muhammad Yunus. The development budget and the non-development or operating budget make up the two halves of the budget. The report states that in the first four months, 24.6 percent of the operational, or non-development, sector’s budget was implemented. That is 1,24,620 million taka in terms of taka. During the same time frame in the previous fiscal year, 98,665 crore taka were spent in this sector. 5 lakh 6 thousand 971 crore taka has been set aside for this sector in the current budget.
However, during this period, development expenditure has decreased to a record amount of 5.83 percent. In terms of taka, which is 16 thousand 426 crore taka. The allocation for this sector is 2 lakh 81 thousand 453 crore taka. In the same period of the last fiscal year, the implementation rate in this sector was 8.58 percent. In terms of taka, which was 23 thousand 974 crore taka.
Former Finance Secretary Mahbub Ahmed told to media that the salaries and allowances of government employees will increase, and pensions will also have to be paid. However, the cost of paying interest is increasing at a terrible pace. Therefore, the government will have to take initiatives to increase revenue by reducing borrowing. However, in order to increase revenue, more emphasis should be placed on direct taxes instead of indirect taxes like VAT. At the same time, tax evasion must be prevented.
Finance Ministry officials said that cost-saving measures have been taken in government spending in coordination with the contractionary monetary policy to prevent inflation. Along with this, major cuts are being made in the implementation of projects adopted for political purposes. The deterioration of the law and order situation caused by the movement since the beginning of the fiscal year and the subsequent change of power in August, as well as the reshuffle in the administration, are slowing down the implementation of government development programs. In such a situation, although there have been cost-saving measures in government spending overall, the interest payment expenses on the uncontrolled loans taken by the previous government have increased significantly. Moreover, there is not much scope for cuts in the operating budget. Again, it has not been possible to reduce the expenditure in the operating budget due to some unexpected increases in expenses.
Due to the slowdown in the nation’s economy brought on by the coronavirus, the conflict between Russia and Ukraine, and the implementation of the operating budget in the first four months of the most recent fiscal year, the government has announced cost-saving measures in the last few fiscal years. The execution of the operational
