Bismillah-hir-Rahmanir Rahim
Mr.
Speaker,
I would like to place, with
your kind permission, the supplementary budget for the fiscal year 2003-04 and
the budget for the fiscal year
2004-05 for kind consideration of this august
House. In the last two and a half years, after assumption of office by the
present government, the success achieved in restoring macro-economic stability
along with economic and human resource development has been acclaimed by all
quarters. We sincerely believe that economic growth turns futile unless it
benefits the poor. Therefore, the goal of the development philosophy adopted by
the BNP government under the noble leadership of Shaheed President Ziaur Rahman
was to establish multi-party democracy and to deliver the benefits of economic
growth to the poor.
Mr.
Speaker,
2. Twenty-three years ago, on the eve of
launching our Second Five-Year Plan in 1980-81, I said in my first budget speech
as the Finance Minister:
“This plan is not a
blueprint for conventional economic growth. It is the first step towards a
radical transformation of the condition and role of our deprived country and our
poverty-stricken people. . . . We intend to move the development process towards
the people rather than dragging them to it".
Mr.
Speaker,
3. We could realise, as back as in 1980-81,
that reduction of poverty would not be possible by employment generation alone.
The characteristics of poverty are multi-dimensional. On the whole, poverty can
be reduced by reaching the required level of education, health and nutrition
related services along with generation of employment opportunities to the
doorsteps of the poor. In that speech, I also said:
“A very important feature of
our plan is to take every necessary measure to provide appropriate training to
the rural masses to upgrade their skills. . . . The rural masses cannot
effectively participate in the development process without continuing
improvement in their required health services nor can they have the capacity to
enjoy the fruits of development. Economic development becomes meaningless to
them. ”
Emphasising the need for
bringing the women into the mainstream of development, I further mentioned in my
budget speech of 1991-92:
“The progress of a society
will be constrained if half of its population is neglected and excluded from the
benefits of development. It is, therefore, necessary that women are
progressively brought into the mainstream of economic
activities."
Mr.
Speaker,
4. The economic development philosophy of
the BNP government under the firm and dynamic leadership of Begum Khaleda Zia
has been formulated keeping in view Shaheed President Ziaur Rahman’s philosophy
of ensuring economic development with poverty reduction as the topmost priority.
We have never deviated from this fundamental philosophy; rather with a view to
implementing it we have been incessantly making efforts to update our
strategies. The honorable members of the Parliament may kindly note that the
policies and programmes enunciated by the BNP government over two decades ago
are fully consistent with the Millennium Development Goal declared at the
initiative of the UN in 2002 for reduction of poverty throughout the
world.
Mr.
Speaker,
5. With this year’s budget I am having a
rare privilege of presenting the national budget for the tenth time to the
august House. I express to Allah, the Almighty my profound gratitude for
bestowing on me, the opportunity to prepare budget for the tenth time with the
main goal of improving the lot of the poor of this country. I also express my
profound respect to Shaheed President Ziaur Rahman, the great proclaimer of
independence and the dreamer of building a poverty-free Bangladesh and also
convey my sincere gratitude to the Hon'ble Prime Minister Begum Khaleda Zia for
giving me this rare opportunity. I firmly believe that the budgets to be
prepared by the BNP government in future will duly reflect the hopes and
aspirations of the poor people of Bangladesh, and also contain policy guidelines
for realising those hopes and aspirations.
Mr.
Speaker,
6. Bangladesh has received global
appreciation for attaining outstanding success in alleviation of Human Poverty
in education, health and nutrition. We have graduated from the low level to the
mid-level group of countries in the Human Development Index according to the
UNDP's Human Development Report, 2003. In primary and secondary education
Bangladesh has already achieved the Millennium Development Goal of eliminating
gender disparity between boys and girls. Providing primary education to almost
97 percent children has already been ensured. This rate is the highest amongst
the developing countries. Bangladesh has achieved remarkable success in reducing
infant and maternal mortality as well as malnutrition and has substantially
improved food security.
Mr.
Speaker,
7. For reducing income-poverty, it is
necessary to create large-scale employment opportunities along with actions to
directly involve the poor in income-generating activities. The achievement of
Bangladesh in reducing income-poverty in the last decade has also been
remarkable. In the past decade the income-poverty has reduced from 58.8 percent
to about 49.8 percent. It is my firm belief that continuation of wider reforms
within the framework of the development philosophy initiated by the BNP
government long ago would have enabled us to achieve greater progress in
economic growth and poverty reduction.
Mr.
Speaker,
8. The honourable members of the Parliament
are aware that in continuation of our economic growth and poverty reduction
strategy and in the light of the Millennium Development Goal, we are
implementing from this year the Medium Term National Strategy for Economic
Growth, Poverty Reduction and Social Development. The goals we aim to achieve by
the year 2015 through implementation of this Three-year Rolling Plan are
to: reduce by half the current
level of poverty through massive employment generation; eradicate extreme
poverty; provide quality primary education to all children; maintain gender
equality for boys and girls in primary and secondary education and significantly
reduce infant and maternal mortality and malnutrition.
Mr.
Speaker,
9. The GDP growth rate has to be raised to 7
percent annually on average to achieve poverty reduction target by 2015.
Substantial public as well as private investment will be needed to achieve this
desired growth. Immediately after coming to office, in the first year, the
government has reduced the budget deficit to a sustainable level and restored
macro-economic stability through various policy measures. The present government
believes that maintaining macro-economic stability is a precondition for
economic growth and poverty reduction; hence budget deficit has to be kept at
sustainable level. Public investment would be increased through mobilization of
additional domestic resources and through increasing concessional foreign
assistance. Dependence on foreign assistance would be gradually reduced to
attain self-reliance. Our revenue/GDP ratio is about 10.5 percent whereas
expenditure/GDP ratio is 14.5 percent. We have to increase both these ratios to
attain higher growth and reduce poverty. We will have to take simultaneous
actions so that the private sector along with NGOs can play a leading role in
the process of economic growth and poverty reduction.
Strategy for Development and
Poverty Reduction
Mr.
Speaker,
10. The Three-Year Strategy for
Economic Growth, Poverty Reduction and Social Development being implemented by
us has been formulated after extensive exchange of views with representatives of
all segments of the society. This integrated strategy has been formulated with
poverty reduction as the prime objective of all social and economic policies. We
are now having comprehensive exchange of views with relevant representatives of
all levels of people including at the field level to finalise this strategy by
December this year.
Mr.
Speaker,
11. We have adopted some specific
policies and strategies to fulfill our election pledge and to achieve the
Millennium Development Goal. In order to implement the policies and strategies,
we have already taken up various programmes and would further adopt some new
measures. I would like to present to this august House an outline of these
policies and measures.
·
Programmes related to
agricultural research, extension, production of improved varieties of
agricultural seeds, irrigation, fertiliser, supply of quality seeds and crop
diversification will be further expanded to boost agricultural
production.
·
Steps will be taken to
ensure fair price of agricultural commodities and to increase agricultural
subsidy. Other special incentive programmes for agriculture will be further
extended.
·
Credit at lower rate of
interest and technical know-how for agriculture, fisheries and livestock and
rural non-farm activities will be further extended.
·
Credit without collateral at
lower rate of interest for developing micro-enterprise will be
ensured.
·
Credit programme at
reasonable rate of interest will be implemented for development of priority
sectors like small and medium enterprises and agro-based
industries.
·
Extensive training programme
will be undertaken for developing entrepreneurs and efficient employees in every
sector.
·
Due importance will be given
to building rural roads, culverts, bridges, rural electricity, railway and
inland shipping.
·
Public sector investment in
energy, electricity, roads, railways, inland shipping, telecommunication and
information technology will be increased on priority basis and equity of
allocation in this investment will be ensured.
·
Programmes relating to
maintenance of infrastructure, Food for Works programme, VGD, VGF will be
further extended.
·
The existing social safety
net programme will be expanded and new programmes will be undertaken to
alleviate the sufferings of the deprived people.
·
The housing programme for
the homeless poor and low-income people will be further
extended.
·
New programme will be taken
up to generate employment opportunities for the hardcore
poor.
·
Budgetary allocation will be
increased for education, health and nutrition sectors to reduce human poverty.
It will be ensured that major share of this allocation reaches the
poor.
·
NGOs and Community Based
Organisations (CBOs) will be encouraged to have appropriate role along with the
government in poverty reduction.
·
Private sector will be
encouraged to play increasingly greater role in economic growth and in setting
up labour intensive industries.
The main goal of all these
policies and strategies will generally be rural development and creation of
wider employment opportunities.
Mr.
Speaker,
12. Comprehensive reforms are
indispensable in economic, administrative and institutional areas to establish
good governance and to implement pro-poor economic development strategy. We will
implement these reforms at such speed we deem appropriate and according to our
own need and design. We do not believe in any reform, which hurts the poor and
the larger section of the society. We will implement in an incremental way
reforms designed by ourselves in order to achieve pro-poor growth and reduce
inequality between the rich and the poor.
Medium-Term Macro-Economic
Framework (MTMF)
Mr.
Speaker,
13. Government is going to finalise a
Medium Term Macro-economic Framework for achieving pro-poor economic
growth. Important elements of this
macro-economic framework are:
·
GDP
will increase from the present rate of 5.52 percent to 6 percent in FY 2004-05
and to 7 percent in FY 2007-08.
·
The
present revenue/GDP ratio of 10.5 percent will increase to 12 percent in FY
2007-08.
·
The
present government expenditure/GDP ratio of 14.5 percent will rise to 16.2
percent in FY 2007-08.
·
Budget
deficit will be maintained at 4.2 percent of GDP and annual inflation contained
below 4.5 percent.
·
Expenditure
in the budget for poverty reduction will be increased by at least 1 percent of
GDP every year.
Mr.
Speaker,
14. I would like to throw some light on
the likely obstacles and risks in implementing this framework in the short to
long term and also the preparation of the government to meet
them.
(1)
After
the phase out of the MFA in January 2005, there will be no quota for the
ready-made garment sector. This will cause the ready-made garment sector to face
more competition for retaining or increasing the market share in the global
market. Our entrepreneurs in the ready-made garment sector has made commendable
contribution to the development of this sector, and we expect that through their
experience, talent, knowledge and initiative they will be able to expand this
sector in the global market by being more competitive. But the phase-out of MFA
might have some short-term impact on employment in this sector and its exports.
In order to face this challenge, government in the meantime has already set up a
high-powered National Co-ordination Council. Government will take necessary
action according to the recommendations of this Council.
(2)
A
three-year Export Policy (2003-06) has been declared keeping in view the
objectives of increasing exports, poverty reduction and employment generation.
Diversification of exports and establishing backward linkage industries will be
encouraged further. It may be mentioned here that various steps are being taken
for ensuring duty-free market access of the Bangladeshi products into foreign
markets and meanwhile as a result of these steps our exports to Canada has
increased by 140 percent. Export
incentives to different sectors will continue.
(3)
Implementation
of the MTMF will depend on mobilisation of necessary domestic resources and
foreign assistance. The macro-economic framework will have to be revised if
domestic resources and external assistance fall short of the projection. I will
mention the steps necessary for harnessing domestic resources according to
projection in the second part of my budget speech. I believe that proper
utilisation of foreign assistance will play a facilitating role for mobilisation
of necessary foreign assistance.
(4)
Our
needs are unlimited while resources are scarce. Equitable distribution of scarce
resources on the basis of national priority is indispensable. Any failure in
this regard will affect our desired goal of poverty reduction. Therefore, we
will have to abandon our inclination to unnecessarily increase the number of
development projects in a conventional way in continuation of past practice
without giving priority to poverty reduction.
(5)
The
efficiency of every sector has to be increased for utilisation of approved
allocation in the budget. The projected macro-economic framework will have to be
revised if resources are not properly utilised according to the targets and
necessary reforms are not implemented. The government has almost finalised its
work on updating and simplifying the procedure for project preparation and
approval so that effective utilisation of budget allocation can be ensured.
Besides, comprehensive technical training programme is being implemented to
improve economic management capacity of ministries. It is hoped that these steps
will play an effective role in efficient utilisation of
resources.
(6)
Increasing
private investment will continue to remain a challenge. It appears from data
relating to investment registration, investment statistics, import of capital
machineries, growth in the manufacturing sector that the government has
succeeded in establishing an investment-friendly climate in the country. From
July 2002 to May 2004, investment proposals have increased by 11 percent as
compared to investment proposals for five years prior to July 2002. Foreign
investment in 2003 has increased by 32 percent over that of last year. We hope,
investment-friendly environment will be further consolidated as a result of
improvement of infrastructure, continuing reforms in the financial sector and
introduction of e-Governance by the Board of Investment.
(7)
However
sound the economic fundamentals are, our desired goal of achieving pro-poor
economic growth will be seriously affected if it is not possible to improve
non-economic environment like further improvement of law and order situation,
curbing corruption and establishing good governance in all areas. The government
is fully aware of these non-economic factors. The government will continue to
strengthen its efforts to further improve the non-economic environment. An
Independent Anti-Corruption Commission will be operational soon. Regulatory
Commissions have been established in Telecommunication and Energy sectors. For
establishing transparency, accountability and dynamism in financial management,
'Public Procurement Guidelines' have been formulated and made effective.
Confrontational politics and lack of security create obstacles in the
improvement of both economic and non-economic environment. Therefore, in this
area, sincere cooperation of all political parties, representatives of civil
society and people belonging to all strata of the society will be indispensable
along with government's dedicated efforts.
Recent Economic
Trends
Mr.
Speaker,
15. Budget is the main instrument for
implementing economic policies. Let me now highlight the achievements of the
government attained through implementation of the budget for the year 2003-04.
After last year's GDP growth of 5.3 percent, this year the estimated growth is
5.52 percent. In 9 months upto March 2004, there has been a 14.7 percent growth
in exports, compared to 6.2 percent during the same period last year. During
this time import has increased by 15.4 percent, compared to the growth of 7.4
percent last year. Due to 11.4 percent increase in the remittances from
expatriate Bangladeshis during the same period, the current account surplus rose
to the tune of US$350 million. The overall surplus in the Balance of Payment
stood at US$227 million. Foreign exchange reserve in October 2001, when we came
to power, was US$1 billion. Now this reserve has increased to US$2.6 billion,
enough to pay for three months' import bills.
16. Adequate growth in private sector
credit for productive investment has been ensured in fiscal 2003-04 to
accelerate investment and economic growth. Industrial term-loan has increased by
73.9 percent, which undoubtedly indicates further acceleration of the economy in
the future. Mainly due to increase in import price of oil and food staff in the
international market there was some inflationary trend in the first part of the
fiscal year 2003-04. The government adopted a careful and restrained monetary
policy along with other measures like refixation of import duties in order to
contain inflation to a reasonable level. As a result, inflation started showing
downward trend and in March 2004 it came down to
5.9 percent.
Revised Budget
2003-04
Mr.
Speaker,
17. I will now highlight the salient
features of the revised budget for FY 2003-04 and the proposed budget for FY
2004-05. The estimated revenue receipt for the current fiscal year was Taka
36,171 crore. In the revised budget, it has been refixed at Taka 35,400 crore.
The revised estimate has been lowered due to reduction of duties of certain
commodities after the budget and also non-realisation of arrear revenue from
some organisations. In the original budget of the current fiscal year the size
of the Annual Development Programme (ADP) was Taka 20,300 crore. The ADP has
been downsized to Taka 19,000 crore due to slow progress of implementation of
some projects. The combined estimated development and non-development
expenditure for the year 2003-04 was Taka 51,980 crore, which in the revised
budget has been refixed at Taka 49,367 crore. As a result, budget deficit will
come to 4.2 percent of GDP from estimated 4.8 percent.
The Budget for the FY
2004-05
Mr.
Speaker,
18. The revenue receipt for the FY
2004-05 has been estimated at Taka 41,300 crore, which is 16.7 percent higher
than that of the revised budget of the current fiscal year. For FY 2004-05 the
ADP has been estimated at Taka 22,000 crore which is 16 percent higher than that
of the revised ADP of the current fiscal year. Besides, in the proposed budget
for fiscal 2004-05, Taka 979 crore has been earmarked for non-ADP employment
generation programme and for other development expenditures. In addition, Taka
860 crore has been allocated for development programme financed from revenue
budget. Therefore, in FY 2004-05 development related expenditure will come to
Taka 23,839 crore. In the proposed budget for FY 2004-05, priority has been
given to sectors involved in poverty reduction and human development such as
agriculture, irrigation, labour and employment, rural development, education,
health, women, child and youth development, water resources, energy and power,
infrastructure, railway and inland water transport, rural infrastructure,
telecommunication, foreign investment and export inducing
sectors.
19. 55.5 percent of the ADP for FY
2004-05 will be financed from our own resources, while the remaining 44.5
percent will come in the form of foreign assistance. Total expenditure, both
development and non-development has been estimated at Taka 57,248 crore which is
16 percent higher than that of the revised budget. 62 percent of development
budget and 42 percent of non-development budget have been allocated for direct
and indirect poverty reducing programmes. In FY 2004-05, the estimated budget
deficit will be 4.3 percent of the GDP.
Mr.
Speaker,
20. Now I would place before the august
House some important proposals included in FY 2004-05 budget for achieving
pro-poor economic growth in the light of our policies and strategies and to
implement our promises to the nation.
Human Resource
Development
Mr.
Speaker,
Education
21. For FY 2004-05, I propose an
allocation of Taka 7,680 crore for the education sector in revenue and
development budget combined. This allocation is Taka 940 crore more than the
revised budget allocation for the current fiscal year and is 13.4 percent of the
total budget. As a result, education will receive highest allocation in the
budget. I propose an allocation of Taka 3,071 crore from development budget for
implementing 51 projects in the education sector.
Mr.
Speaker,
22. For reducing shortage in the number
of teachers in the government primary schools, 28,168 new teachers have been
appointed so far by the present government. Besides, appointment of assistant
teachers in the 4,017 newly created posts is under process now. We have ensured
reaching textbooks to the students in time. Introduction of stipends in the
primary schools instead of 'Food for Education' has benefited about 55 lakh poor
families.
23. Implementation of the 6-year
"Primary Education Development Programme-2" with an outlay of about Taka 5,000
crore is being implemented for expansion and qualitative improvement of primary
education. Under this programme, 35,000 new teachers will be recruited, 30,000
classrooms constructed along with maintenance work of primary schools and
training institutions, 90,000 teachers will be trained and about 40 crore books
will be supplied to students. A new
project named, "Reaching Out of School Children" with an outlay of about Taka
400 crore is being undertaken to create scope for primary education for children
who are deprived of this opportunity. Under this project, 20 lakh children
belonging to 600 Unions of 60 Upazilas will be brought within the net of primary
education and will be given various amounts of financial incentives depending on
their classes of study.
Mr.
Speaker,
24. Although the number of students in
primary and junior as well as in secondary/Dakhil and higher secondary/Aalim
scholarships examinations has increased significantly, the number and amount of
scholarships have not been changed for long. In order to encourage the
meritorious students, I propose to double from July 2004-05 the number of
scholarships at different primary and secondary levels from 35,000 to 77,000. I
also propose to raise the amount of scholarship on an average by 15
percent.
Mr.
Speaker,
25. In order to improve secondary and
higher secondary education, infrastructure facilities are being developed
through construction of 6,763 secondary schools, 2,410 madrasahs, 848 colleges
and 448 technical training institutions belonging to public and private sector
throughout the country. The government is spending about Taka 300 crore annually
to expand women education through BNP government-introduced stipend programme.
Under this programme 45 lakh girls are getting stipends, their tuition fee has
been waived and they are also getting financial assistance for purchasing books
and for paying examination fee. Four Science and Technology Universities have
been established to expand facilities for science and technology education. Moreover, we have enacted laws for
conversion of 4 BITs into Engineering Universities.
26. National Education Commission has
already submitted its report to the government. The government will evaluate the
report of the Commission and take appropriate action on the recommendations of
the Commission to reform the education sector.
Health
27. In the health sector, I propose an
allocation of Taka 3,732 crore combining revenue and development in the next
year's budget. As a result, the allocation for the health sector will increase
by Taka 810 crore from this year's original allocation.
28. After assumption of office, we took
significant measures for overall development of the health sector. These include
: establishing new hospitals, increasing beds in the existing hospitals, filling
up all vacant posts of doctors, nurses, medical technologists and health
assistants along with all other vacant posts; creating new posts and increasing
supply of medicine and medical equipment to the hospitals. Postgraduate courses
in 6 medical colleges and two institutions have been introduced by the present
government for increasing the number of specialist doctors in the country. Steps
have been taken to establish a Medical University at the national level and
approval has been given to establish 7 new medical colleges and 8 health
institutes in the private sector.
29. Implementation of a three-year
Health, Nutrition, Population Sector Programme (HNPSP) has started with an
outlay of Taka 9,410 crore with the objective of reaching health services to the
doorsteps of the people and aiming at overall improvement of health services.
Through successful implementation of this project, steps will be taken to reach
health services on a priority basis to the poor and to the areas which are
comparatively deprived of health services.
30. A new programme will be launched
from July this year to reduce maternal mortality by 75 percent with government's
own resources in line with the Millennium Development Goal. Under this pilot
programme, pre and post natal health services will be provided to poor women of
21 Upazilas by government and private hospitals free of cost through voucher
system.
Agriculture and Rural
Development
Agriculture
Mr.
Speaker,
31. I would like to mention here some
of the specific steps the government has already taken to reduce agricultural
production cost and to extend incentives to farmers in various ways. These are
:
·
Interest
on agricultural loan has been reduced to 8 percent.
·
Interest
on classified agricultural loan upto Taka 5,000 as on 31st December 2003 has
been waived and all Certificate Cases against the concerned loanees have been
withdrawn. As a result about 15 lakh farmers have been relieved of interest
charges amounting to about Taka 500 crore. They have also been given
opportunities to obtain fresh loan.
·
15
percent subsidy has been given in respect of electricity consumption in
irrigation and agriculture related activities.
·
Cash
subsidy for export of agricultural commodities introduced by the alliance
government has been increased to 25 percent.
·
Agricultural
loan amounting to Taka 3,500 crore has been disbursed upto May this year which
is 20 percent higher than that of last year.
Mr.
Speaker,
32. In both revenue and development
budget for 2004-05 for Ministry of Agriculture, I propose an allocation of Taka
1,777 crore which is Taka 867 crore more than the allocation in the revised
budget for this year. In the next year, agricultural extension research,
training, production of improved seeds, conservation and distribution of seed
and irrigation activities will be strengthened. In addition to the projects
undertaken under ADP, 16 development programmes financed from revenue budget
will be implemented.
Mr.
Speaker,
33. Now I am placing before the august
House my proposals on agricultural subsidies, special incentive programmes for
agriculture and for encouraging exports of agro-products :
·
In
the last budget of the previous Awami League government the allocation for
agriculture subsidy was Taka 100 crore only. After assumption of office, our
government has already increased agricultural subsidies by three times raising
it to the level of Taka 300 crore this year. I propose to double the allocation
on agricultural subsidy and agricultural incentives from Taka 300 crore to Taka
600 crore in the next fiscal year.
·
Cash
incentive for export of agricultural products, fruits and vegetables will be
raised to 30 percent from 25 percent.
·
Necessary
incentives will be provided for production of Robi crop.
·
Bangladesh
Bank will provide financing as required at 5 percent rate of interest to
Bangladesh Krishi Bank, Rajshahi Krishi Unnayan Bank and other nationalised
banks so that they can provide adequate agricultural loan to the farmers at 8
percent rate of interest.
Fisheries and
Livestock
Mr.
Speaker,
34. I propose allocation of Taka 546
crore in the combined development and revenue budget for the FY 2004-05 for
Fisheries and Livestock sector. As a result their allocation will increase by
Taka 110 crore from the revised budget allocation of this year. With next year's
enhanced budget allocation the ministry will be able to increase expenditure for
purchase of equipment and medicine for treatment of livestock, feed for
livestock and poultry, production of vaccine, research, etc. The Ministry of
Fisheries and Livestock will implement 30 projects under the development budget
for extension of pisciculture, recovering fish habitat in open water bodies,
extension of pisciculture technology at the Union level, extension of artificial
insemination and also livestock services at the Union
level.
Water
Resources
Mr.
Speaker,
35. National Water Management Plan has
been formulated to resolve the existing problems in water management with a view
to increasing food production, protecting crop in the flood-prone areas of the
country and increasing production of fish. This will contribute to employment
generation and poverty reduction. I propose an allocation of Taka 1,132 crore in
the revenue and development budget for Ministry of Water Resources in the budget
for fiscal year 2004-05.
Rural
Development
Mr.
Speaker,
36. I propose an allocation of Taka
4,902 crore in the revenue and development budget for local government and rural
development sector which is Taka 336 crore more than the original budget of
current fiscal year. The Local Government Engineering Department will construct
3000 km of metal roads, 5,500 km of earthen road and 220 Union Parishad
complexes. A 'Char Livelihood Project' in 5 districts with an outlay of Taka 475
crore is being implemented to raise the living standards of extreme poor people,
belonging to some disaster prone districts. The 'Abashan Project' is being
implemented by the Office of the Prime Minister to provide land, houses, credit
facility, education, health, family planning services and employment
opportunities to 65 thousand landless and extreme poor people. The Youth
Development Directorate is also implementing projects for employment generation
of unemployed rural youth, both men and women, through provision of training and
micro-credit.
Social
Security
37. The role of directly poverty
targeted programmes in alleviating the extreme suffering of the poverty stricken
rural people and in generating employment for them is very important. After
assumption of office, our government has increased the number of beneficiaries
and the monthly allowances under old age allowance programme, widowed and
deserted women allowances scheme and honorarium scheme for insolvent freedom
fighters. I would now like to place my proposal for further expansion of
different directly poverty-targeted programmes.
·
Old-age
allowance
: From 1st of July 2004 monthly allowance to be raised by 10 percent to Taka 165
and the number of beneficiaries to be increased by 2 lakh reaching 12 lakh. It
may be mentioned that during the last year of the Awami League government the
number of beneficiaries of this programme was 4 lakh 15 thousand and monthly
allowance was Taka 100 only.
·
Allowances
programme to the widowed, deserted and destitute women:
From 1st of July 2004 the allowances in this scheme to be raised by 10 percent
to Taka 165 and to increase the number of beneficiaries by 1 lakh reaching 6
lakh. During the last year of the Awami League government, the number of
beneficiaries was 2 lakh 8 thousand and monthly allowance was Taka 100
only.
·
Honorarium
programme for insolvent freedom fighters
: From 1st of July 2004 to increase the number of beneficiaries by 10 thousand
reaching 60 thousand.
·
Fund
for Mitigating risk due to natural disaster
: This fund introduced by our government received an allocation of Taka 75 crore
earlier. An additional Taka 75 crore may be allocated to the fund in the next
fiscal year.
·
Fund
for rehabilitation of the acid burnt women and the physically
handicapped
: Allocation of Taka 40 crore was made to this fund earlier. An additional
allocation of Taka 25 crore may be made to this fund next fiscal
year.
·
Fund
for the housing of the homeless :
An allocation of Taka 98 crore has already been made earlier to this housing
fund. An additional amount of Taka 50 crore may be allocated to this fund next
fiscal year.
·
VGD
: The allocation of 1 lakh 65 thousand metric tonnes may be raised to 1 lakh 70
thousand metric tonnes in the revised budget and to 2 lakh tonnes in the next
fiscal year's budget.
·
VGF
: The allocation of 15 thousand metric tonnes will be increased to 95 thousand
in the revised budget and to 1 lakh tonnes in the next fiscal year's
budget.
·
Food
for Works Programme
: To increase to 2 lakh 20 thousand metric tonnes in the revised budget of this
year from 1 lakh 70 thousand metric tonnes in the original budget and increase
it to 3 lakh 30 thousand metric tonnes in the budget of the next fiscal
year.
·
Food
for Works Programme (Cash)
: To increase to Taka 140 crore in the revised budget of this year from Taka 122
crore in the original budget and enhance it to Taka 168 crore in the budget of
the next fiscal year.
·
Test
Relief
: To increase to 1 lakh 25 thousand metric tonnes in the revised budget of this
year from 1 lakh tonnes in the original budget and to 1 lakh 50 thousand tonnes
in the budget of the next fiscal year.
·
GR
: To raise to 40 thousand metric tonnes in the revised budget of the current
fiscal year from 35 thousand metric tonnes in the original budget and 64
thousand metric tonnes in the next fiscal year.
·
To
meet sudden natural disasters Taka 100 crore to be provided as block allocation
in the next year's budget to the Ministry of Food and Disaster
Management.
Programme for Mitigating
Economic Shocks
Mr.
Speaker,
38. In addition to these
poverty-targeted programmes, I propose to introduce two new programmes to enable
employees/labourers to face sudden economic shocks and to allocate Taka 50 crore
for these programmes.
·
Special
fund with an allocation of Taka 30 crore to be created for retraining and
creation of employment opportunities for voluntarily retired, retrenched
employees/labourers.
·
Special
fund with an allocation of Taka 20 crore for retraining and creating employment
opportunities for employees/labourers of garment
industries.
39. I would like to mention here that
in the 74-acre land of the closed Chittagong Steel Mill, 150 industrial units
will be set up by the Export Processing Zone Authority. Besides, an industrial
park will be set up by BSCIC in the Adamjee Jute Mills complex. As a result,
employment opportunities will be created for about 9 lakh
people.
Special Credit Programme for
Employment Generation
Mr.
Speaker,
40. Micro-credit programmes
implemented by the government departments/agencies : In addition to
micro-credit programmes being conducted by different government
departments/agencies and NGOs, the government has for the first time allocated
in this year's non-development budget an amount of Taka 345 crore for
micro-credit programme of different government departments. Besides, under the
development budget, various ministries, departments are implementing
micro-credit programme involving about Taka 5,200 crore. Many NGOs are involved
in implementing a number of these government-sponsored programmes. In order to
further expand the micro-credit programme, I propose to allocate in next fiscal
Taka 315 crore from non-development budget in favour of few ministries to
conduct these micro-credit programmes.
·
Taka
120 crore for the Rural Development and Co-operative
Division
·
Taka
100 crore for the Ministry of Agriculture
·
Taka
30 crore for the Ministry of Fisheries and Livestock
·
Taka
25 crore for the Ministry of Youth and Sports
·
Taka
25 crore for the Ministry of Liberation War Affairs
·
Taka
15 crore for Ministry of Women and Children Affairs
41. Micro-credit programme conducted
by the Palli Karma Shahayak Foundation (PKSF) : The PKSF has been conducting
micro-credit programme with the financial assistance of some development
partners and also with government financing. PKSF has distributed micro-credit
worth Taka 1,700 crore to about 50 lakh beneficiaries through 216 NGOs upto
January 2004. I propose to allocate Taka 219 crore for FY 2004-05 to PKSF for
implementing micro-credit programme through NGOs.
42. NGO Foundation : I propose
to allocate Taka 50 crore to the NGO Foundation for accelerating social
development in the rural areas through NGOs.
43. Special Fund for employment
generation of the hard-core poor: There are many among the hard-core poor
who are unable to receive benefits from the existing micro-credit programmes. A
pilot programme is being implemented through the PKSF to generate employment for
these hardcore poor. I propose to establish a fund for generating employment for
these extremely poor people by allocating Taka 100 crore in the FY 2004-05.
PKSF, through the NGOs, will operate the fund on behalf of the
government.
44. Fund to create micro enterprises
in the rural areas : I propose to establish a fund for development of micro enterprises in the rural areas and
allocate Taka 50 crore to the fund. PKSF through the NGOs will operate the
fund.
45. Assistance for agro-based
industries : We allocated an amount of Taka 50 crore for assistance to
agro-based industries in the last fiscal year. I propose to allocate Taka 100
crore for promotion of agro-based industries in next year's
budget.
46. Equity Entrepreneurship Fund
: I propose to allocate Taka 200 crore in the next fiscal year for providing
equity support to computer software, food processing and agro-based
industries.
47. Refinancing Financial
Institutions by Bangladesh Bank for promoting small and medium industries :
The Bangladesh Bank will expand refinancing facilities amounting to Taka 250
crore at 5 percent rate of interest to financial institutions for extending
credit to entrepreneurs of small and medium industries.
48. Restructuring of Capital of the
Karma Sangsthan Bank, Bangladesh Krishi Bank and Rajshahi Krishi Unnayan
Bank : Capital amounting to Taka 200 crore will be given to Karma Sangsthan
Bank, Bangladesh Krishi Bank and Rajshahi Krishi Unnayan Bank to expand their
loan operation in the rural areas in FY 2004-05.
49. As a result of the proposed
measures, the flow of credit to the rural areas will double in the next year and
massive employment opportunities will be created.
Women
Development
Mr.
Speaker,
50. In Bangladesh now, the
participation of women in socio-economic activities is increasing. More than 1
crore 20 lakh women in Bangladesh now are self-employed through successful
utilisation of micro-credit facilities. The access of women to the labour market
has significantly widened. Over 18 lakh women are now employed in the garment
industry. In politics as well, the number of women participants is increasing.
More than 14 thousand elected women representatives in the local bodies are
performing their responsibilities. Recently we have enacted a law creating 45
reserved seats for women in the Parliament. The efforts of the government for
women development and establishing women rights will
continue.
Infrastructure
Energy and
Power
Mr.
Speaker,
51. In order to meet the growing
demand for gas, projects for drilling some wells are continuing. A few more new
gas-well drilling projects will be undertaken. Additional gas transmission lines
are being constructed for transmission of gas from north-eastern part of the
country to other regions. The total installed capacity of power generation
including private sector is 4,710 megawatts. After assuming office, the present
Government has by now increased production of power by 705 megawatts by taking
several important initiatives. Besides, 221 power transmission lines and 32,100
km of distribution lines have been commissioned. Currently, 15 new power
stations are under construction in the public sector to produce 2,610 megawatt
of electricity. In addition, several projects are being implemented in the
private sector to produce 1,390 megawatt of electricity. I propose a total
allocation of Taka 4,351 crore in the next fiscal year for energy and power
sector. This allocation constitutes 19.2 percent of the total development outlay
of the next fiscal year.
Roads and
Railways
Mr.
Speaker,
52. I propose an allocation of Taka
4,480 crore, in both non-development and development budget for the Ministry of
Communication including Railway. Along with construction of 'Lalan Shah Bridge',
which is the second largest bridge in the country over the river Padma, quite a
few large bridges have been constructed in the last two and a half years. The
construction of Rupsha Bridge in Khulna is ongoing. After completing the
preparatory work for the Padma Bridge we hope that it will be possible to start
the construction work by the year 2006-07. In the meantime significant numbers
of new roads have been constructed, existing roads widened, developed and
repaired. Steps have been taken to improve regional cooperation and strengthen
economic and commercial relation with our eastern neighbours including Myanmar
and Thailand through establishing road network with our neighbour, Myanmar.
Railway has been playing very important role in communication network of
Bangladesh. Work is in progress to gradually rehabilitate railway tracks and
bridges, remodelling and modernisation of railway
stations.
Telecommunication
Mr.
Speaker,
53. After the present government's
assumption of office, number of T&T telephone connections has been increased
from 5 lakh 64 thousand to 8 lakh, NWD call charges reduced by 72 percent and
international call charges by 46 percent. Efforts are underway by the T&T
Board to provide mobile phone connections to 10 lakh subscribers, out of which 2
lakh 50 thousand connections will be given by the end of this year. The work of
setting up the submarine cable will be completed by October 2005 linking
Bangladesh with the global information super highway. I propose to allocate Taka
1,351 crore to the telecommunication sector combining revenue and development
budget for the FY 2004-05.
Financial Sector and Private
Investment
Mr.
Speaker,
54. The present government is firmly
committed to take appropriate steps to reduce investment cost, establish
investment-friendly environment and promote employment generation. The bank rate
has been reduced from 6 percent to 5 percent in order to bring down overall
interest rate to reasonable level. Public sector credit from the banking sector
has been significantly reduced. As a result, rate of interest has already come
down by 2 percent. I hope the downward trend in interest rate will
continue.
55. As a result of various measures
taken by the present government, substantial progress has already been made in
restoring discipline in the financial sector. Classified loans have been
substantially reduced. Reforms are underway to improve the technical and
professional efficiency of Bangladesh Bank. An initiative has been taken to
provide technical assistance for improving the quality of operation of other
nationalised banks. The contribution of expatriate Bangladeshis in the economic
development of the country is outstanding. Efforts of the government will be
further strengthened to encourage the expatriate Bangladeshis to remit home
their hard earned foreign exchange through the banking channel and to invest it
in productive activities.
Mr.
Speaker,
56. The capital market has revived
gradually as a result of various reform measures taken by our government to
revitalise the share market destroyed by the previous government at the very
outset of their tenure. At the time of our assumption of office, the market
capitalisation of Dhaka Stock Exchange was Taka 7,220 crore only, which has
recently increased to about Taka 11,900 crore. During this period, the general
share price index of Dhaka and Chittagong Stock Exchanges have increased to 76
percent and to 40 percent respectively. The listed companies have been given
fiscal incentives. Moreover, in order to establish transparency in their
operations, their price-sensitive information is being regularly published.
Their accounts are being subjected to special audits. The Central Depository
System has already started operation. As a result of these measures, it is hoped
that the share market will get a new lease of life.
Public Administration,
Security and Law and Order
Mr.
Speaker,
57. Within the context of fast changing
global perspective, we need a forward looking, efficient, honest and modern
civil service respectful of the needs of people in general. As part of civil
service reform, we have meanwhile taken some important decisions including
promotion of civil servants on the basis of merit and efficiency.
Ministries/Divisions have been grouped into four clusters in order to promote
specialisation in civil service, so that officials can better serve the needs of
the people. Provision of Taka 200 crore has been kept in next year's budget to
fill-up most essential vacant posts.
58. In fulfillment of our election
pledge, a 'Pay Commission' will be constituted at the beginning of the next
financial year for refixation of pay scales of the officers and employees of the
government and autonomous bodies keeping in view the increased cost of living. I
propose to implement the new pay scale from January 2005 after evaluation of the
recommendations of the Pay Commission. The medical allowance of officers and
employees is inadequate. As an interim measure, I propose to raise the medical
allowance of all government employees from Taka 300 to Taka 400 per month with
effect from July 2004.
Mr.
Speaker,
59. I further propose to grant one
festival allowance equivalent to net monthly pension from the next fiscal year
to all retired government servants to enable them to enjoy the festivals. This
is another exceptional measure of the alliance government.
Mr.
Speaker,
60. The organogram of the Police
Department is being restructured in order to make the Police force stronger and
more effective. The Police force will be strengthened and equipped with adequate
logistics in accordance with the restructured organisational setup. A Rapid
Action Battalion (RAB) consisting of about 5,500 officials of different levels
has been raised and made operational. It has been decided to substantially
increase the manpower and logistics support for Bangladesh Rifles, Ansar and
Bangladesh Coast Guard. I propose to allocate in the combined revenue and
development budget for FY 2004-05 Taka 2,367 crore for the Ministry of Home
Affairs, which is Taka 473 crore higher than the allocation in the revised
budget. As a result the Police department alone will get an additional
allocation of Taka 306 crore next year over their budget for the current
year.
61. Our Defence forces have been
playing commendable role in protecting our sovereignty and security, in
combating natural disasters and in UN Peacekeeping operations. I propose an
allocation of Taka 4,416 crore for the Ministry of Defence. The net budget of
the Ministry of Defence in the next year will amount to Taka 3,870 crore after
deducting the receipts of Taka 546 crore from UN peacekeeping
operations.
62. In order to do away with delays in
disposal of justice, we have introduced Alternative Dispute Resolution mechanism
along with implementation of Speedy Trial Act. I propose to allocate for the
time being Taka 5 crore in the next year's budget for operationalising the
Independent Anti-Corruption Commission.
Mr.
Speaker,
63. I sincerely thank the Hon'ble Prime
Minister for giving me valuable guidance in the preparation of the budget for
2004-05. I also thank my Hon'ble Cabinet colleagues, Hon'ble members of
Parliament, distinguished politicians, renowned economists, business community,
members of civil society, journalists and NGO representatives for their support
and advice in the formulation of the budget.
Mr.
Speaker,
64. The people of Bangladesh are
exceptionally enterprising, have tremendous self-confidence and indomitable
courage. Given opportunity, they can achieve rare success in shaping their
destiny. I urge upon you all, irrespective of political affiliations, to come
forward, join our hands to help create that opportunity and build a happy,
prosperous Bangladesh, free from poverty.
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