AHM Mustafa Kamal will present the third budget as the finance minister today. He could not present the first budget properly due to illness. The second budget had to be paid in coronavirus. The wish was that the budget for the next financial year could be given under normal circumstances. But the third budget also has to be given in the so-called ‘severe’ lockdown, in the language of the government, in the restrictions. Another feature of the new budget is that it will be the 50th budget of Bangladesh.
Bangladesh’s budget has a traditional look. The budget speech of the finance minister is very conventional, unnecessarily long and tedious. The budgeting process is also conventional. People’s representatives also have no involvement in this budget. The Finance Minister and the National Board of Revenue (NBR) discussed the new budget with some individuals and groups. And after the budget, the budget is passed after discussion in the parliament. Before passing, some instructions of the Prime Minister, some amendments and budget pass.
What kind of budget do you want? This is the most discussed issue before the budget. Everyone talks about the expectations of the budget from their place. But this time the situation is different. The world economy is in crisis. It is becoming difficult for many countries to protect both life and livelihood at the same time. As a result, different countries are coming out of the traditional trend and finding new ways. What kind of budget do you want at such a time? Then let’s see what I don’t want.
There is a lot of discussion and concern about the Indian type of coronavirus. Then the Indian budget can also be discussed. The country’s finance minister Nirmala Sitharaman gave the budget for the fiscal year 2021-22 on February 1. The entire lecture is 65 pages long, up to 39 pages. The rest is appendix. At the beginning, he said that there are 8 pillars in his budget. Such as: 1. Health and well-being, II. Physical and financial capital and infrastructure, 3. Interested in the overall development of India, 4. In the case of human resources, 5. Innovation and research and development and 6. Minimum government, maximum administration (minimum government, maximum governance).
The entire speech of the Finance Minister is on these six issues. Of this, the budget for health and well-being has been increased by 137 percent as compared to the previous financial year. No statistics on the total size of the budget, income and expenditure are mentioned anywhere in the entire speech. There is no data on GDP or GDP at this time. However, there is a big discussion about the revenue situation and deficit financing.
For example, Finance Minister Nirmala Sitharaman has proposed to spend Tk 34.5 lakh crore in the revised budget instead of spending Rs 30.42 lakh crore in the actual budget. In the fiscal year 2021-22, the budget deficit will be 7.8 percent of GDP, while in the revised budget for 2020-21, the deficit will be 9.5 percent of GDP. To meet this deficit, the total debt collection from the market will be around Tk 12 lakh crore. However, the finance minister said the revenue deficit would be reduced to 4.5 per cent of GDP by 2025-26.
The finance minister also gave good news in the budget. He says corporate tax rates have been reduced to one of the lowest in the world. And small taxpayers have been exempted by increasing the benefits. Apart from this, there are details of what facilities have been provided in the budget for entrepreneurs, women, elderly people and any other class.
Stay away from discussing GDP
The budget presented by Finance Minister AHM Mustafa Kamal on June 11 last year was initially regrettable for failing to give the country’s best GDP growth to the economy. He mentioned the GDP several times in his 110-page budget speech.
Several economists have suggested staying away from GDP discussions in the new budget. Because, the time is not for GDP growth, but for survival. So there is no need to divert the budget discussion by talking about a growth-oriented budget. Without it, people have endless suffering. At this time, growth and per capita income growth data will prove the futility of statistics for many.
Let the speech be short
Incumbent Finance Minister Nirmala Sitharaman gave the longest speech in the history of India in terms of time. In 2000, he spoke for 2 hours and 40 minutes. However, the biggest statement in terms of word count was made by Manmohan Singh in 1991. The number of words in his speech was 16,650. However, it was in this budget that a comprehensive plan to start major reforms was mentioned. That is why it has taken place in history. The number of words in Nirmala Sitharaman’s speech was 13,275. This time, however, Nirmala Sitharaman has reduced the size of her speech.
The budget speech for the current financial year in Bangladesh was 130 pages. The Finance Minister’s speech is 110 pages long. According to the budget speech, a large part of it is a long description of the government’s work plan and resources. Much of this description is tedious. Mostly known information, only details and details. No other country’s budget speech has such details. However, if there is a description of small and necessary information, the general public’s interest in the budget will increase.
Want the necessary information
A large number of people in Corona have been affected. According to the survey, 80 percent of people have lost their income. Many have lost their jobs. Many people have fallen below the poverty line anew. The government has provided loans from the incentive fund. Most of these loans are received by adults but less by children.
People will want to know the details of the initiatives taken in the current budget for all classes of people, what has been the result of the evaluation of the government, how much has been implemented, who has benefited, who is lagging behind. In the current crisis, it is more important to give information to different classes of people without giving details of everything in the budget speech as much as the work of different ministries and departments.
Bangladesh’s budget has a traditional look. The budget speech of the finance minister is very conventional, unnecessarily long and tedious. The budgeting process is also conventional.
Is health a priority?
It is true that priority is given to the health sector, but the budget allocation is almost the same as before. Speaking of priorities, the allocation should reflect that. The new budget needs to have an assessment of what has been done in the health sector over the past year. I would also like to explain the reasons why the Ministry of Health is lagging behind in budget expenditure. The general public will also want to know the reasons for not being able to use the money allocated for research. So no one will be interested in the conventional details about this sector. Rather, experts believe that Ticker should have a roadmap.
Stay away from statistics
There is no way to know the budget of other countries including India by reading the budget speeches. But there are details of it in Bangladesh. Because, it is true that the finance minister is complacent in announcing a budget of Tk 6 lakh crore, but it does not matter to the common man. While other countries’ budgets are basically a matter of who has what, budget figures are not important there. Because, 6 lakh crore rupees will not be distributed per capita. Rather, the impact and impact of the money that the government will spend is more important.
Let’s discuss the deficit
In the interest of the economy, there is an unwritten rule to limit the budget deficit to 5 percent of GDP. Supposedly, so far the deficit can be kept. But it is not the deficit rate, but the deficit financing that is important here. If deficits are met with loans on easy terms, the risk is less. But borrowing at high interest rates will create a crisis in the future. The largest sector of such government spending is now interest payments. As liability increases with higher interest loans, so does the amount of debt per capita. In other words, in the last judgment, it is falling on the shoulders of the common man.
It can be assumed that the budget deficit will increase this time. The Finance Minister will give a clear explanation of the funding deficit, its impact and plans to reduce it in the future.