budget 2014: annual development program adp abdullahil mamun, assistant professor of economics, dba,...

7/28/2019 Budget 2014: Annual Development Program ADP Abdullahil Mamun, Assistant Professor of Economics, DBA, IIUC

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Budget for FY2014

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Abdullahil MamunAssistant Professor of Economics

Department of Business Administration,

International Islamic University Chittagong,

Bangladesh.

Annual Development Program(ADP)


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Table 3: ADP Utilization (Taka in Crore)

FY PADP RADP

RADP as %

of PADP

ADP

Utilization

ADP Utilization Rate

(As % of RADP)

ADP Utilization Rate

(As % of PADP)

2008-09 25600 23000 89.84 19700 85.65 76.952009-10 30500 28500 93.44 25918 90.94 84.98

2010-11 38500 35830 93.06 33007 92.12 85.73

2011-12 46000 41080 89.30 38020 92.55 82.65

2012-13 55000 52366 95.21 25921 49.50 47.13

RADP- Revised Annual Development Program, PADP- Proposed Annual Development Program.

ADP allocation is Tk. 65,870 crore: 5.5% of GDP, 29.6% of expenditure target,

25.8% and 19.8% higher than the revised and proposed ADP of FY2013,

respectively.

For the last twenty years, the expenditure on the ADP is continuously increasing

while implementation of ADP is much lower than its target.

Last three years ADP utilization rate is over 92%.

In earlier years ADP implementation in early months (in the first three quarters)

was very poor and maximum ADP utilization took place in the last quarter.

In FY2013, 49.5% ADP allocation was implemented in the first three quarters

which was 44.8% in FY2012. For FY2013, once again we have to relay on the ADP performance of last quarter

ADP performance: Past to Present

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If such, in FY2014: the expected ADP utilization will be around Tk. 47310 crore

ADP utilization will not be sufficient to maintain the expected

investment-GDP ratio

It will be difficult to achieve the proposed growth target

In FY2013 ADP has been downsized to Tk. 52,366 crore

Definitely public investment target of 7.2% will not be met.

ADP performance: Past to Present

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- On average 11.33 percent reduction of proposed ADP allocation has been

observed

- 81 percent of revised ADP is utilized, and- Highest implementation takes place in the last three months of every

fiscal year.

(Unnayan Onneshan, 2011)


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ADP Allocation in Recent Budget

Sector

No of

Projects

Share

FY12

(RADP)

Share

FY13

(RADP)

Share

FY14

(ADP)

Growth

ADPFY13

over

RADPFY12

Growth

ADPFY14

over

RADPFY13

Transport 203 15.1 14.5 23.3 31.1 85.1Power 54 17.6 15 13.7 9.6 5.7

Education & Religious Affairs 105 11.8 11.6 13.3 52.9 32.6

Rural Development & Institutions 86 12.3 11.8 10.1 24.2 -1.3

Physical Planning, Water Supply

& Housing 133 10.2 8.5 8.3 26.1 11.7

Top Five Sectors 581 67 61.4 68.7 27.3 29Total ADP 1030 100 61.4 100 34.1 15.3

Top 5 sectors has received 68.7% of the total allocation

85.1% ADP growth of FY14 over FY13 for transport is noteworthy. The

incremental allocation for transport sector is 83.4%.

Total allocation for Padma Multipurpose Bridge Project (PMBP) is Tk.6,852 crore

- 10.4% of proposed ADP

- 42.7% of ADP allocation to transport sector, and

- 33.4% of the total PMBP project cost

Continuing projects receive a maximum of 48.5%, only 1.9% for new

projects. 4


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Challenges for ADP Implementation

Implementation capacity is not improved

In FY2014, gross foreign aid requirement will be around USD 345 crore: 12.11% of

budget, 2.3% of GDP. It is almost an unreachable target in view of the following

facts-

Government itself is worried about the fall in domestic private investment.

Foreign aid faces major cut when there is a slow ADP implementation.

InFY2013, only USD 200 crore is received against the target of USD 302 crore

Weak institutional capacity is evident: project aid utilization is low, despite

availability of foreign aid in the pipeline.

Outcomes The reliance on domestic sources for ADP financing may continue

Untidy scenario in ADP accomplishment limits employment generation scope

DosDynamism in the administrative machinery should be ensured

But in the budget it is not mentioned how ADP would be implemented smoothly.

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budget 2014: annual development program adp abdullahil mamun, assistant professor of economics, dba,...

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