The fundamental challenge facing policymakers in implementing a contractionary budget will be patience

The Centre for Policy Dialogue (CPD) today said that the government's target to reduce inflation to 6.5 percent in the fiscal year 2024-25 appears overly ambitious

Budget day is turning into our very own Groundhog Day.

The FY 2024-25 budget falls short of assessing the depth of the economically challenging time.

Bangladesh’s per capita income will be $3,000 at the end of FY25 as the government expects economic growth to recover. Per capita GDP is projected at $2,780 at the end of FY24. It has been growing steadily over the last two decades. It was $700 in 2000 and about $300 in 1990.

While the cost of living remains high, with the inflation rate hovering at over 9 percent throughout the year, no ray of hope came for the common people in the budget declared yesterday. This is upsetting for the low and middle-income groups of society. 

The budget for fiscal 2024-25 proposes a total expenditure of Tk 797,000 crore with a total tax revenue of Tk 541,000 crore, resulting in a deficit of Tk 256,000 crore.

Finance ministers don’t possess crystal balls to captivate the audience with mystical allure. They don’t have magical foresight. They are real-world agents of economic policy. In times of crisis, which often repeats itself in modern capitalism, they chart a path out of the dark abyss. Sometimes they prove to be successful, sometimes not.

The proposed national budget for FY25 has remained a widely speculated topic for the people of this country. Bangladesh has been navigating a precarious global economy over the last 24 months, and the economic aftereffects of Covid-19 and the Ukraine-Russia have not only complicated macroeconomic management but created widespread concerns across both domestic and international actors.

Budget FY25 What does it mean for you?

Prices up

The proposed budget for 2024-25 lacks creativity and offers no solutions to the many complex challenges facing the country’s economy, economists have said.

Where will the money come from?

Backtracking on its promise to eliminate black money, the government has once again made room to allow both individuals and companies to whiten money without facing scrutiny and by paying a 15 percent tax, a move that drew sharp criticism from economists and civil society.

Where will the money go?

Bangladesh truly is unique in the sense that its government keeps granting individuals the opportunity to whiten black money, despite its questionable record of success. An amount of Tk 78 crore was whitened in the 1977-78 budget, Tk 850 crore during 1987-90, Tk 1,000 crore during 2000-01, Tk 4,403 crore during 2005-06, Tk 9,683 crore during 2007-08, Tk 1,213 crore during 2009-10, and Tk 20,600 crore in 2020-21.

BNP Secretary General Mirza Fakhrul Islam Alamgir yesterday termed the proposed national budget “anti-Bangladesh”, saying it contains new schemes to facilitate the embezzlement of public money by the ruling party-backed looters.

In its first proposed budget after assuming power for a fourth consecutive term, the Awami League government skirted round some of the promises the party made in its election manifesto for the January 7 parliamentary polls.

The budget for the upcoming fiscal year, presented in the context of inordinately complex economic circumstances, reflects both the government’s restraint and limitations.

Budget out of Tk 100