Tk 1 lakh 14 thousand crore to be spent on interest payments in next fiscal year

The government has to borrow from various sources to meet the budget deficit every fiscal year. As a result, interest expense of the government has doubled in the last five years. Taka 57 thousand 663 crore had to spend on interest payments in the fiscal year 2019-2020. In the next financial year, the proposed allocation for this sector is Taka 1 lakh 14 thousand crore.

Finance Division of the Ministry of Finance disclosed this information.

In the budget of the current fiscal year, there is an allocation of Taka 94 thousand 376 crore in the interest expense sector. But in the revised budget, it has been increased to Taka 1 lakh 5 thousand 300 crore.

In this regard, the finance division said another challenge in the government’s financial system is the high interest rate in both the domestic and international markets, which is increasing the borrowing cost of the government. This situation will be more challenging in the mid-term due to the increasing demand for infrastructure, social safety nets and other development targets of the government.