Tk 1,13,819 cr nat’l budget for 2009-10

Earning Tk 79,461 crore; Expenditure Tk 82,ooo crore; ADP Tk 30,500 crore;deficit Tk 34,358 crore; GDP growth target 5.5 per cent

Finance Minister Abul Mal Abdul Muhith presented a Tk. 1,13819 crore national budget for 2009-10 in parliament on Thursday with special emphasis on implementing the ruling Awami League's election pledge - 'Charter of Change'.Of the total outlay of the budget, the first of this government and the 38th since independence, Tk. 82,000 crore has been earmarked for revenue expenditure and Taka 30,500 crore for the Annual Development Programme (ADP) while the GDP growth.The budget proposes revenue earnings of Tk 79,461 crore leaving a record deficit of Tk. 34,358 crore which will be met with foreign assistance of Tk.13,803 crore and domestic borrowings of Tk. 20,555 crore.

The budget deficit is estimated At 5 per cent of the GDP.The original size of the budget for the outgoing fiscal 2008-09 was Tk.99,962 crore which stands at Tk.94,130 crore after downward revision, the total deficit being Tk. 24,960 croreIt is after two years that the finance minister presented the budget in the parliament.

In the previous two years during emergency rule the budgets were announced outside of the House. The new budget gives special attention to some key issues such as combating recession, mobilising internal and external resources, promoting agriculture, infrastructure development , education and IT, generating employment, checking inflation, and alleviating poverty.

Finance Minister Muhith's budget, for the first time in the country's history, includes Public-Private Partnership (PPP), bailout strategy for recession-hit sectors, special allocations for creating jobs for ultra poor and establishment of a national service scheme to facilitate people with jobs who have qualifications up to the higher secondary level. Tk. 21,00 crore has been allocated for the newest avenue of this years budget , Public Private partnership (PPP).

The new budget outlines major reforms in the tax collection machinery to mobilise more internal resources faster than ever by expanding the tax net. For fiscal 2009-10, revenue through NBR is estimated at Tk. 61,000 crore and revenue receipt from non-tax and non-NBR sectors is estimated at Tk. 15,506 crore and Tk. 2,955 crore respectively. The size of this year's budget is the largest ever and so is the deficit.

The new budget proposes expansion of the tax net to mobilize domestic resources. Import duty on motor vehicles and other luxury items have been enhanced to mobilize domestic resources.The budget seeks to mobilize additional revenues through various fiscal measures and restructuring the existing tax net.

The finance minister vowed to expand the tax net instead of increasing the tax rates. Total revenue earnings target for the fiscal 2009-10 is set at Tk 79,461 crore which is 14.86 percent higher than the revised revenue for the outgoing year.Of the total revenue earnings, income tax receipts are projected at Tk 16,560 crore. To boost income tax, the budget proposed taking taxpayer's identification number (TIN) for use of cars, company registration, designing of house in divisional cities and for getting drug licenses etc.

Growth of the value added tax (VAT) is estimated at 13.31 percent to Tk 22,795 crore for next fiscal.The budget proposes to allow whitening of black money by paying 10 percent tax if invested in infrastructure, specific industrial sectors and share market. Black money can also be whitened by paying tax for purchase of appartments. This opportunity will be available for three fiscal years.

The finance minister mentioned that the budget is expansionary and ambitious, particularly the ADP and therefore he laid emphasis on effective and efficient supervisory mechanism without which he felt implementation of measures in the budget would fall behind .Finance Minister AMA Muhit in his budget speech said, the budget for FY2009-10 will be the first step towards our journey to realise the dreams enshrined in our vision. "Through the budget proposals, after carefully evaluating our preparedness to tackle the impact of global recession, anysing the possible resource constraints and taking into account the capacity for implementation of development programmes, I intend to proceed with the budget proposals enshrining our promises to keep for the charter of change," he said.

Budget aims at fulfilling election pledges: Finance Minister

Finance Minister AMA Muhith has said the new national budget is not just a statement of income and expenditure of the government rather it is an instrument through which we would ensure growth, poverty reduction and achieve the macroeconomic fundamentals as per the earlier election pledges of the Awami League-led grand alliance government."With a view to taking country's economy to the higher trajectory of growth, we have to come out from the vicious poverty cycle by bringing a qualitative change in the investment strategy.

In order to attain such higher growth, investment in infrastructure development, especially power and energy, ports, communication, supply of drinking water and waste management, education and health will be given highest priority," he said this while delivering his budget speech in the parliament on Thursday.This, the first budget of the Awami League-led grand alliance government comes in the backdrop of global recession.

The Prime Minister and Leader of the House Sheikh Hasina was present in the parliament while opposition leader and BNP chairperson Khaleda Zia remained absent as BNP has been boycotting the budget session over a seating dispute.

AMA Muhith observed that since the implementation and funding of any infrastructure development projects is a long drawn process and the investment risk is much higher as well as is not, in many cases, commercially viable."We are going to take special initiatives to involve the private sector under Public Private Partnership (PPP) to meet the probable investment gap in infrastructure development and maintenance, alongside the government's investment.

We trust that successful application of PPP concept will open up the door for increased flow of investment from both local and foreign investors. This will accelerate economic growth," he hoped. Referring to the need to keep the negative impact of global recession at a minimum level on the remittance flows in mind, the Finance Minister mentioned some strategies of the new government that include: rehabilitation of the jobless returnee expatriate workers, continuation of diplomatic initiative to prevent retrenchment of workers, exploration of new labour markets abroad and making the National Skill Development Council more effective."

The budget for Financial Year 2009-10 has been formulated keeping in mind the need to maintain macroeconomic stability in the context of current global economic meltdown, achieving desired economic growth to fulfill our election pledge and contributing to poverty reduction.

With regards to these, we have attached priority to massive employment generation, enhancement of social safety net, creation of self-employment, reduction of regional disparity, increasing emphasis on agricultural development, achieving the target of power generation, acceleration of industrialization and building necessary infrastructure for Digital Bangladesh".

Muhith said in the proposed budget, the government has given highest priority to overall agriculture and rural development sector as 48 percent of our labour force is engaged in this sector with a target to ensure food security for our citizens through developing theagriculture sector by 2012.The government's initiatives would increase irrigation facilities by protecting more areas from flood and continue the efforts for river protection, reduction of risk of salinity and maintenance dredging, he added.

The Finance Minister assured that the industries affected by the economic melt-down will be given various support packages on a case-to-case basis to keep them afloat and in competition and until alternative arrangements are made for the likely displaced workers an SOE will not be closed.In his budget speech, AMA Muhith was also very vocal to ensure the trial of the Bangabandhu murder case and killings of four national leaders in jail.

"In order to establish rule of flaw in the country, these trials have to be completed fairly. We are reviewing the 5th amendment of the Constitution and based on that review we are planning necessary measures, including possible amendment of the Constitution" he continued, "We shall in no way tolerate any extra judicial killing. All such incidents will be subject to judicial investigation."

Many other socio-cultural and political issues were also mentioned in his speech. He sought all out cooperation to build up a sonar Bangla earlier dreamt by the father of nation Bangandhu Sheikh Mujibur Rahman.

Budget sparks mixed reaction

The national budget for fiscal 2009-10 has sparked mixed reaction with one group of politicians, businessmen and economists hailing the budget as pro-people and some others specially the opposition groups criticizing it as anti-people.

Expressing reaction on budget, different groups of people said that the countrymen were waiting with eagerness to see such a budget under a democratic government for long through which the country's overall development and sufferings of people will be reduced although some others termed the country's 39th budget "tremendous" for huge amount of loans and "adventurous" for targeting large revenue earnings and said that if the government fails to collect revenue targeted for fiscal 2009-10, the country's economy will face serious setback.

Talking to this correspondent about budget, Professor Muzaffer Ahmed said that he waits to see the effectiveness of budget on the country's economy and its people. "I will make comment on the budget later. However, the system of the government to turn black money into white will not be able to shrink black money because as many as Tk 70,000 crore is being produced in the country every year."

Economist Professor Abu Ahmed said that it is the country's biggest budget. If the government is able to manage the budget as per plan it will bring good result to the country. Otherwise, load of loan of the government will be heavier and country's economy may face instability.Abu Ahmed said the budget usually boosts up the country's economy.

Moreover, black money owners will be benefited instead of common people through making black money white. BNP Standing Committee member Lieutenant General Mahbubur Rahman (Retd) said that the government has approved a big budget for reaping its own interest. "A tremendous load of loan has been imposed on the shoulder of the country and its people by the biggest budget, nothing else."The government should be congratulated by the people for making such a budget with a view to paving the path of development of the country removing different crises. No government has been bold enough to approve such a big budget except this democratic government.

Besides, the government will have to fulfill pledges given to people during electioneering, said Azizul Haque, a real estate businessman.A good number of common people working at different sectors in the city said that the government must keep prices of essentials reasonable and also meet their demand. "I came to know through TV that food security for the poor would be ensured by this budget. Besides, prices of essential commodities were under control during the last tenure of Awami League government," said Moslehuddin, a rickshaw puller while talking to this correspondent yesterday

Dishonest traders raising prices on different pretexts

A section of dishonest traders have started raising prices of essentials on pretext of budget, pay hike of government employees and the upcoming Ramzan.Traders, of different items including essentials like edible oils, imported machinery and medicines, in the capital have started hoarding of the items which has created an artificial crisis in the market, posing a threat to the people.

While visiting city's different markets, this correspondent found that the traders of essential commodities are charging enhanced price for all most all items on the pretext of budget. The prices of essentials rise every year in the country soon after budget, and thus, this year is also in no exception.Talking to The Bangladesh Today, Kamaruzzaman a grocery trader of Farmgate area said prices of all essentials items have started increasing and it might go beyond means of people during the month of Ramadan.

Soon after national budget and before the month of Ramadan, the prices of essential commodities start increasing every year. The government should find out the reason behind of this and it should also keep close watch on the movement whole sellers. He said the prices of all sorts of edible oils in the market have increased up to Tk 100 per five litre can. Beside, the price of wheat has increased up to Tk 10 per two kg packet and potato price is highly instable in the market.

The recent price hike of essential commodities is the impact of illegal storage of products. For creating a critical situation and artificial crises of daily commodities in the market, a section of dishonest traders along with their associates have started a price hike of essential commodities throughout the country.

If the government is not be able to foil the ongoing plot, people sufferings will increase enormously during Ramadan, a group of businessmen of Kawran Bazar kitchen market told this reporter yesterday.Belal a pharmacy businessman of Farmgate area said people are feeling crisis of some medicine recently which are imported from different foreign countries.

fter budget, price hike of different items in the country is a common trend, so artificial crisis of foreign medicine in the market has already been created to make earn quick profit. Punitive measures should be launched against the quarters, he added.

Budget to total 16.5 percent of total GDP

Finance minister AMA Muhith has proposed a budget of Tk 1,13,819 crore for FY2009-10, or 16.5 percent of total GDP.

In his budget speech, Muhith has set the target for revenue collection at Tk 79,461 crore. The budget deficit will amount to Tk 34,358 crore.

Muhith proposed to meet the deficit by loans totalling Tk 20,555 crore from internal sources while another Tk 13,803 crore from foreign support The finance minister forecast 6 percent GDP growth for 2009-10.

Muhith began announcing the annual outlay in parliament from 3.15pm Thursday, broadcast live on state-run TV and radio.

The first budget of the new government comes with the back drop of global recession and Awami League's expansive electoral pledges.

Prime minister Sheikh Hasina was present in the House, while opposition leader Khaleda Zia remained absent as BNP has been boycotting the budget session over a seating dispute.

Growth inflation seen to fall

Finance minister AMA Muhith, who laid out his Tk 114,000 crore budget on Thursday, sees the economy slowing and inflation falling.

In his budget speech Thursday, he set a target of 5.5 percent GDP growth for FY2009-10. Growth rate for the current FY2008-09 was 5.88 percent, which fell short of the targeted 6.5 percent, and marked a fall from the previous year's 6.2 percent.

With falling commodity and fuel prices, along with favourable production conditions, annual average inflation would come down to 6.5 percent from 7 percent, said Muhith. On a point to point basis inflation in July of the current fiscal year was 10.8 percent which fell to 5.4 percent in April 2009.

Average rate of inflation for the year was 9.9 percent in FY 2007-08. The finance minister presented the first budget of the new government in parliament Thursday, with a prposed outlay of Tk 1,13,819 crore. It comes in the back drop of global recession and the Awami League's expansive electoral pledges.

Prime minister Sheikh Hasina was present in the House, while opposition leader Khaleda Zia remained absent as BNP has been boycotting the budget session over a seating dispute.