Abdur Rahim Harmachi
Chief Economics Correspondent
The foreign aid received by Bangladesh has nearly trebled, to USD 334.69 million, in the first three months of the current fiscal as compared to the same period last year.
An expert believes the boost in the flow of foreign aid is an outcome of the government’s alertness over the implementation of the foreign aided projects after allegations of corruption surfaced in the construction of the Padma Bridge – the country’s largest infrastructure project.
“The government is paying it’s attention to implement projects with transparency as corruption charges surfaced in the Padma Bridge Project,” Bangladesh Institute of Development Studies (BIDS) Research Director Zaid Bakht told bdnews24.com.
According to latest figures available from the Economic Relations Division (ERD), different donor countries and agencies disbursed a total of USD 334.69 billion as aid in the three months (Jul-Sep) of the 2012-13 financial year, which is 176 percent higher than the figures for the corresponding periood last year.
The net ammount of foreign aid was around USD 121 million last year.
Zaid Bakht said the government had demonstrated its sincereity in implementation of the projects in a transparent manner and added, ” The government has already formed an inter-ministerial committee to ensure transparency and accountibily in the implementation of the projects.”
He claimed such a move by the government had satisfied the donors.
He thinks the country’s foreign currency reserve has also increased due to a rise in foreign aid by those donors.
He said: ” Around USD 12 billion foreign aid is waiting in pipeline.”
The in-flow of new foreign aid will increase if the government works in a transparent way, he added.
Presenting the budget for 2012-13 fiscal before Parliament, Finance Minister AMA Muhith had said the government planned to borrow Tk 338.84 billion from domestic sources. The figure includes Tk 230 billion from banks, which is Tk 50 billion higher than what was in the last fiscal.
The government took over Tk 85 billion in the first five months of the fiscal.The amount was around Tk 160 billion in the same period last year.
According to ERD’s data, the amount of foreign aid disbursed during (Jul-Sep) is USD 523.53 million. Meanwhile the government spent over USD 1.8 billion to repay the previous loans.
Taking these into account, the net foreign aid stood at USD 333.69 million in the first quarter of the year.
World Bank suspended its pledged $1.2 billion credit last year raising graft allegations against some senior government officials, and set some conditions for its return to the project. It finally cancelled the deal on June 29 saying no measures were taken to meet those conditions.
But the bank announced its conditional return to the project on Sept 20 after efforts by Bangladesh government.