Finance Minister Abul Hassan Mahmood Ali on Thursday unveiled the national budget for FY2024-25 in the Parliament proposing an expenditure of Tk 7,97,000 crore with a revenue income of Tk 5,41,000 crore.

This left a deficit of Tk 2,56,000 crore, said Ali in his maiden budget speech as the finance minister.

He proposed to meet the gap with the collection of Tk 1,60,900 billion from domestic sources and another Tk 95,100 billion from the foreign sources.

This is the first national budget for the current Awami League government of Prime Minister Sheikh Hasina since it assumed office early this year after sweeping the January 7 general election.

While preparing the budget the government faced the challenges of inflation, declining foreign exchange reserves, and dwindling exports and imports.

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In the fiscal year beginning July 1, the finance minister expects that the economy will grow by 6.75 percent, a percentage point higher than the outgoing year. This year’s GDP has been estimated at 5.82 percent, down from the original projection of 7.5 percent.

Ali has been hopeful of taming the inflation at 6.5 percent during FY2024-25, which may prove a tall order in the context of the current level of inflation at about 10 percent.

For the upcoming fiscal year the government has already approved an Annual Development Program (ADP) of Tk 2,65,000 crore.

Ali said, “While allocating resources emphasis has been given resource allocation for the Annual Development Program for investment and development of physical infrastructure.”

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In addition, he said, “special importance has been given on compulsory education, health, science and technology for the development of human resource and knowledge-based society.”

The proposed spending has been split into three divisions: Social infrastructure, physical infrastructure and common service sector. A total allocation of Tk 2,06,569 has been proposed for the social infrastructure, which is 25.92 percent of the total allocation. Physical infrastructure has received an allocation of 2,16,111 crore has been proposed, which is 21.12 percent of the total outlay. For the common service sector, an allocation of Tk 1,68,701 crore has been proposed.

Mentioning that there has been a significant depreciation of taka currency against US dollars following the rise in interest rates, the finance minister said the expenditure on interest payments may increase significantly in this context.

For debt payments, the proposed budget has allocated a total of Tk 1,13,500 crore, which accounts for 14.24 percent of the total allocation.

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Finance Minister Ali told the Parliament that in formulation the budget he has laid emphasis on taming inflation, adequate allocation for education and health services for all, food security, building smart Bangladesh, graduation from LDC status, facilitation of business process, climate change, expansion of investment and industry by encouraging private enterprises.

“…special priority has been given to important issues like ensuring youth employment by promoting vocational education and protecting the population lacking social security,” Ali said.

The finance minister has aptly captioned his budget speech as a “March towards smart Bangladesh following the path of sustainable development.

There have been enough allocations for the development of skilled human resources as “smart citizens will be instrumental to building a prosperous and smart Bangladesh by 2041”, a goal set by Prime Minister Sheikh Hasina.