Bangladesh's 2012-13 budget aims for 7.2% GDP growth
Dhaka: Bangladesh Thursday projected 7.2 percent growth and aimed to cap its deficit at 5 percent of the gross domestic product in budget 2012-13.
Finance Minister AMA Muhith suggested a 22 percent rise in tax revenue to 1.4 trillion taka, largely on account of improvements in tax collections and crackdowns on evasion to help offset the rise in spending.
"It is assumed that in 2013, the world economy will recover from the economic recession that re-emerged, especially in Europe, in 2012. As a result, world economic growth will gather pace raising the demand for Bangladeshi exports," Muhith said while presenting the USD 23.5 billion (Taka 1.92 trillion) annual budget.
He said the government aimed to limit its deficit at 5 percent of gross domestic product in the fiscal year 2012-2013 starting in July, down from a revised 5.1 percent of GDP in 2011-2012.
Muhith expected the inflation to ease to 7.5 percent in the next fiscal year, given that the declining trend in food prices in international market and satisfactory domestic farm output.
He hoped exports, mainly garments, will remain a key growth driver for the economy, along with remittance from expatriate Bangladeshis.
Projecting a 20 percent increase in spending, Muhith suggested enhanced allocation for the struggling transport and power infrastructure sectors.
The budget, which is to be endorsed by the Parliament by June-end, also underlined the enhanced allocation for electricity generation in the energy-starved country.
Muhith proposed an allocation of Taka 7,896 crore for power generation, an amount which is over Taka 700 crore more than the sanction of the revised allocation of the last year.
He said Bangladesh was expected to produce 5,000 megawatts (MW) of electricity from nuclear energy by 2030 as he listed a number of plans to augment electricity production including import of 250 MW electricity from India by 2013.
"In addition, (the) import of electricity from Myanmar, Nepal and Bhutan is also under consideration," Muhith said.
Several economists described the budget as an effort to come out from the existing economic crisis.
Others, however, termed it "ambitious" as the 7.2 percent growth target would be the highest for the impoverished South Asian country since 1973-74, when the economy grew 9.59 percent.
The country's Bureau of Statistics has revised the economic growth target for the current fiscal year to 6.3 percent from the government's earlier 7 percent projection.