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In the final year of its tenure, the BNP-led alliance government is in the midst of a difficult time. Some external as well as internal factors, apparently, have taken wind out of its sails, at least partially. Severe power crisis, short-supply of the greenback, high prices of fuel oils in the international market and higher rate of inflation, among others, have put the government in an unpalatable situation. However, the government has to blame itself, none else, for most of the domestic factors that have caused a dent in its public image.
Now there is another piece of bad news. The government is likely to trim the Annual Development Programme (ADP) by over 10 per cent, a record cut in the original ADP in recent years. If such a cut takes place, it will be contrary to the assurance given by the incumbent finance minister in his last budget speech. He said the size of the current year's ADP would remain insulated from any resource crunch. The Planning Commission has reportedly released a guideline setting criteria for the revision of the ADP. The ministries and agencies concerned have been advised to include only priority projects to be implemented with local as well as external resources. Downsizing of the ADP in the last quarter of every financial year has been more of a ritual mainly due to resource constraints. The government is repeating the same act a bit early this year under an unusual situation emerging out of high prices of petroleum and some other commodities in the international market, fall in domestic revenue collection and delayed disbursement of external development assistance.
The projected 10 per cent cut in size coupled with usual shortfall in its implementation is likely to contribute to the non-implementation of a substantial part of the current year's original ADP. There is no denying that the government has come under heavy pressure to divert resources for meeting some unavoidable needs. For instance, the Bangladesh Petroleum Corporation (BPC) has sought a large amount of fund to finance oil imports. The Corporation is now left with no option but to seek funds from the government since it has been incurring huge losses due to the large gap between import and sale prices of petroleum products. Moreover, some of its public sector clients are not paying a huge amount of money against their oil bills. To make things worse for the government a major multilateral donor had delayed in the disbursement of its funds on the plea of 'faulty' tendering process in spite of government's repeated assurances that enactment of a law relating to public procurement was under process. All of those factors combined have gone against the government's efforts to implement the ADP for the current fiscal, what was termed 'ambitious' by many when it was unveiled in the national parliament.
With a view to keeping the fiscal deficit within a reasonable limit of 4.0 per cent, the government, no doubt, needs to restrain its spending. If it decides to be extravagant in an election year to woo voters, the same might fuel inflation which is already high compared to previous years and the people are complaining a lot about it. Besides, the Planning Commission needs to be extra-vigilant that only priority projects, not under political considerations, get a place in the trimmed ADP. The government, being the largest spender of development funds, is also the biggest job provider. It has a huge impact on the poverty situation in rural as well as urban areas. Unfortunately, for domestic and external factors, the expenditure on development activities could never meet the expectations of the people. On the top everything, due to corruption and wastage, benefits of most of the development activities hardly reach those who need it most.
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