The Finance Ministry is planning to set the size of the upcoming 2025–26 fiscal year’s budget at Tk 7.90 trillion, which is Tk 70 billion less than the original budget for the current fiscal year.
If implemented, this will be the first time that the budget size will shrink compared to the previous year.
Officials from the Finance Division said the reduction in size is aimed at making the budget more implementable.
This information came from a meeting of the Coordination Council on Financial, Monetary, and Exchange Rate Affairs held yesterday, Tuesday, chaired by Economic Adviser Dr. Salehuddin Ahmed.
According to sources from the meeting, Finance Division officials stated that the budget size has been reduced mainly in the development sector.
For the new fiscal year, the allocation for the Annual Development Programme (ADP) is being set at Tk 2.30 trillion, down from Tk 2.65 trillion in the current 2024–25 fiscal year.
The current interim government has taken a policy decision not to undertake any new mega projects.
However, despite the reduced budget size, the revenue target for the National Board of Revenue (NBR) is set to increase.
The Finance Division is setting a revenue target of Tk 5.18 trillion for the agency in the upcoming fiscal year. It is reported that the NBR had proposed to keep the target within Tk 5 trillion. In the current fiscal year’s budget, the NBR’s revenue target was Tk 4.80 trillion.
However, due to significantly lower revenue collection than targeted, the revised budget has slashed the target by around Tk 500 billion.
The budget deficit for the next fiscal year is projected to be Tk 2.26 trillion. The Finance Division is forecasting GDP growth of 5.5% and an inflation rate of 6.5% in the new budget.
In contrast, the current 2024–25 fiscal year’s budget had forecasted GDP growth at 6.5% and inflation at 6%.
However, in the revised budget, the Finance Division has projected GDP growth at 5.25% and inflation at 8.5%.
