The government’s borrowing from the banks to meet budget deficit increased to Tk 57,929.3 crore as of April 29 this fiscal year due to a dismal revenue collection amid the global coronavirus outbreak.

According to the Bangladesh Bank data, the government’s outstanding bank borrowing stood at Tk 1,66,025 crore as of April 29 this year from Tk 1,08,095.7 crore on June 30, 2019.

Experts cautioned that the government’s bank borrowing would increase further in the coming months as the coronavirus outbreak had brought the country’s economic activities almost to a halt, leaving the National Board of Revenue to witness a hefty revenue shortfall in the current fiscal year.

In the budget for the fiscal year 2019-2020, the government projected to borrow Tk 47,364 crore from the banking sector.

The latest borrowing figure showed that the government’s bank borrowing had already exceeded the target by Tk 10,565.3 crore with another critical two months of the fiscal year remaining.

Policy Research Institute executive director Ahsan H Mansur told New Age that the government’s bank borrowing would increase further in the coming days due to the sorry state of revenue collection.

He also predicted that the revenue shortfall in the current fiscal year could be up to Tk 1,15,000 crore against the revised target of Tk 3,00,000 crore.

The initial target was Tk 3,25,000 crore in revenue in the current fiscal year of 2019-2020.

In the July-March period of FY20, the NBR collected Tk 1,66,007 crore in revenue, leaving another 45 per cent of its annual target to be collected in just three months.

The revenue collection deficit did not result only from the coronavirus pandemic in the country but also from the NBR’s lack of capacity and the government’s ambitious target, Ahsan said.

He, however, mentioned that the coronavirus outbreak might have affected the NBR’s revenue collection by around Tk 15,000 crore.

The economist also said that the government’s borrowing from the banking sector could have been higher or close to Tk 1,00,00 crore if the implementation of annual development programme was in full swing.

He also mentioned that the ADP implementation in the current fiscal might fall up to Tk 80,000 crore short.

The government has curtailed the ADP implementation target to Tk 1,91,921 crore.

In July-February, the government implemented only 37.09 per cent of the ADP, the lowest since FY17 when the implementation in the seven months was 36.91 per cent.

Replying to a question how the government has been sourcing money for the stimulus packages it announced to offset the coronavirus fallout, Ahsan said that the most of the government announced packages were bank-loan dependent and none had taken the facility so far.

Some of the packages would be implemented from the government’s budgetary allocation for the social safety net, said Ahsan, also the chairman BRAC Bank, adding that a portion of the stimulus package of around Tk 2,500 would be spent by the government.

Speaking about the private sector credit growth that posted a 9.13 per cent growth in February this year, he said that there was no scope for increasing the private sector credit growth even though there would have been a lower demand for bank credit from the government.

In the budget for FY20, the government has planned to borrow Tk 63,848 crore from the overseas sources and the rest Tk 77,363 crore from the domestic ones to meet Tk 1,45,380 crore deficit financing.

The government’s net borrowing from the banking sector was Tk 19,800.9 crore in the entire fiscal year of 2018-2019.

The government repaid Tk 18,405 crore and Tk 2,851.2 crore in FY17 and FY18 respectively against its borrowing from the banking sector.