Budget deficit feared

If the budget of the fiscal year (2020-21) goes to the implementation level then the actual budget deficit may exceed the prescribed limit. That means – the amount of budget deficit may surpass the target.

Such fear has been created due to the global context and internal condition following coronavirus pandemic.

Sometime it becomes tough to maintain the plan to achieve budget target following additional cost during normal economical situation. But, economic recession is going on across the globe. So, there is a possibility of economic recession in the fiscal year of 2020-21. Even, economical disaster would be seen due to the current abnormal condition. That’s why the current budget deficit has been increased to 1 percent of GDP and 0.5 percent from the revised account to 6 percent. The amount is -1 lakh 90 thousand crore taka.

These data were surfaced following the discussion on budget deficit and research of a private firm.

Dr. Selim Raihan, Executive Director of South Asian Network on Economic Modeling (SANEM) told risingbd that the target of the deficit would not be limited to the proposed target. I think the budget deficit would be increased in the future. If the revenue collection doesn’t meet its target and a pressure to do costs go high then the deficit would be increased more.

He also said, “I don’t think it’s a big problem. Budget deficit would be 6 to 7 percent or more. We have to accept it for the next two fiscal years due to Covid-19 crisis.”


Dhaka/Shah Alam/Nasim