Financing may be a major constraint for implementation of the proposed budget, in view of revenue earning scenario, the World Bank said on Monday.
It observed that the government’s growth target may also be affected by investment shortage and persistent weakness in business regulation and service delivery.
In its budget analysis, the lending agency stuck to its earlier projection of Bangladesh growth at 6.3 per cent for 2015-16 fiscal year, as against the budget target of 7 per cent.
The WB earlier estimated the GDP growth for 2014-15 fiscal at 5.6 per cent while the government claimed it to be 6.5 per cent.
“It’s not impossible to attain 7 per cent growth but given the political uncertainty and business scenario, it’s difficult to achieve,” the lead economist at WB Dhaka office, Zahid Hussain, said during a briefing session.
The WB’s acting country director Salman Zaidi made the introductory remarks.
Asked about rationale for the WB’s lower growth projection, he said the Bangladesh Bureau of Statistics (BBS) which calculates the growth, maintains ‘indirect method of national accounting’.
“Such method may not take into account the losses, for example, incurred during the three-month demonstration,” the economist pointed out.
About the target of attaining 27 percent growth in revenue earning set in the proposed budget, he said the target is quite ambitious and any failure to do so would affect the expenditure the next year.
“Earlier it was failure to spend which helped maintain a balance between revenue shortfall and financing gap. This time, budget deficit may be higher,” he said about possible shortfall of resources.
The WB analysis also pointed out certain lack of transparency in expenditures of the budgetary money.
The global lender raised question about sustainability of more banks, be it in public or private sectors, in rebuttal to the budgetary proposal for a possible bank for public servants.
Source: Prothom Alo
