To meet the budget deficit, the government has borrowed Tk 51,989 crore in the first six months of the current financial year 2021-22 (July-December). Of this, Tk 34,713 crore has been borrowed from the banking system, Tk 14,704 crore from savings certificates and Tk 2,562 crore from foreign loans. At the same time in the last financial year, a loan of Tk 47,713 crore was taken to meet the deficit.
This is 24.21 percent of the deficit financing target. It may be mentioned that in the current financial year 2021-22, the overall budget deficit has been estimated at Tk 2 lakh 14 thousand 681 crore. This is 6.2 percent of GDP. However, the budget deficit has been only 1 percent in six months.
According to the Finance Department of the Ministry of Finance, the budget deficit in the first six months of the current financial year stood at 1 percent. Note that the size of the main budget this year is 6 lakh 3 thousand 681 crore. In contrast, the total expenditure in six months has been 1 lakh 49 thousand 816 crore. This is 24.21 percent of the original budget.
In this regard, an official of the finance department said that the government’s deficit financing has decreased mainly due to the acceleration in revenue collection and the implementation of the Annual Development Program (ADP).
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According to the Finance Department, a total of Tk 34,713 crore was borrowed from the banking system in the first six months of the financial year to meet the budget deficit (Tk 14,483 crore in the first quarter and Tk 20,231 crore in the second quarter). This is 45.4% of the annual target. In the budget, the government has set a target of borrowing Tk 76,452 crore from the banking system. During the same period of the last financial year 2020-21, the government borrowed Tk 19,923 crore from the banking system (23% of the annual target). As such, the government’s borrowing from the banking system has increased in the first six months of the current financial year as compared to the previous financial year.
Meanwhile, the target for borrowing from the savings sector in the financial year 2021-22 is Tk 32,000 crore. In contrast, in the first six months of the financial year, the net loan was Tk 14,704 crore (Tk 9,913 crore in the first quarter and Tk 4,790 crore in the second quarter). This is about 46 percent of the annual target. During the same period of the last financial year 2020-21, the amount borrowed from the savings sector was Tk 20,995 crore. As such, government borrowing from the savings sector has declined in the first six months of the current financial year as compared to the previous financial year. However, this year, borrowing from the savings sector declined, but it was higher than the target in the last financial year. However, in the same period of the last financial year, a net loan of Tk 19,923 crore was taken from the bank. The loan from abroad was 6 thousand 795 crore.
According to the information received, the government has borrowed a total of Tk 8,256 crore from foreign sources in the first six months of the current financial year to finance the budget deficit. On the other hand, the total foreign debt repaid at the same time was 5 thousand 694 crore. As a result, the government’s net foreign debt stood at Tk 2,562 crore in six months. This is only 2 percent of the annual target. The target for net foreign borrowing in the current budget is Tk 97,738 crore. During the same period of the last financial year 2020-21, the amount of net foreign borrowing was Tk 6,795 crore. As such, government borrowing from foreign sources has declined in the first six months of the current financial year as compared to the previous financial year.