Rejaul Karim Byron

The government is set to increase its subsidy expenditure by 17.30 percent from the current year
to Tk 27,954 crore in fiscal 2017-18 mainly to supply rice at low price to the poor.
Some Tk 4,546 crore has been earmarked for food subsidy next fiscal year, up 22.17 percent
year-on-year.
In the original budget for the current fiscal year, the allocation for food subsidy was Tk 2,821
crore, which was revised upwards to Tk 3,721 crore to accommodate a programme introduced
last year to distribute rice at Tk 10 a kilogram to the poor.
In the past few years, fuel and power dominated the government's agenda when it came to
subsidies.
But this year and the next, no subsidy has been extended for fuel seeing that the Bangladesh
Petroleum Corporation has been making hefty profit on the back of the lower prices in the
international market. BPC had received more than Tk 42,000 crore from the government as
subsidy in about eight years.

In fiscal 2017-18, the power sector will get a subsidy of Tk 5,500 crore, which is the same as this
year.
The government is also cutting back on its subsidy expenditure on energy and agriculture.
The agriculture subsidy was revised downwards this fiscal year as the fertiliser prices in the
international market are low. Some Tk 9,000 crore was originally allocated for agriculture
subsidy, but it was lowered to Tk 6,000 crore in the revised budget.
However, in the upcoming budget, the allocation was set at Tk 9,000 crore.
There will be no change in the subsidies for exports and jute next fiscal year: they will continue
to be Tk 4,500 crore.
Public-Private Partnership (PPP) fund
Some Tk 2,000 crore has been allocated in the next budget for the public-private partnership
fund with a view to expediting the projects under the initiative.
In his budget speech in the parliament, Finance Minister AMA Muhith said the government has
already created the necessary legal and institutional framework of PPP to mobilise private
investment in construction of public infrastructure.
At present, 45 PPP projects are under implementation, where the share of private investment is
about $14 billion.
Of the projects, loan agreements have been signed for 9, while 13 are at the procurement stage,
according to the finance minister.
Besides, the Bangladesh Infrastructure Finance Fund Limited was established in 2011 to finance
physical infrastructure.
The fund has so far provided financing of Tk 2,113 crore to 26 PPP projects.
There are plans to invest about Tk 3,809 crore from the fund in 20 more projects in 2017 and
2018, Muhith added.