The government’s revised budget reveals a significant increase in the internal debt burden, projected to rise by Tk65,000 crore in the current fiscal year. The finance ministry initially aimed to keep internal debt at Tk1.66 lakh crore but revised it to Tk2.39 lakh crore due to decreased revenue, currency devaluation, and increased expenses, including interest payments. The revised budget indicates a 49% surge in the government’s estimated borrowing from treasury bills, reaching Tk1.95 lakh crore. Additionally, the borrowing from banks has also been raised to Tk1.11 lakh crore. Experts express concerns about the long-term consequences of such substantial borrowing, including increased debt burden, reduced liquidity in the banking system, and potential interest rate hikes. Despite government austerity measures, reduced expenditure, and a lower budget size, the deficit continues to grow, necessitating increased borrowing. The IMF has emphasized the need for a medium-term fiscal risk assessment and the government plans to address this issue in the upcoming budget.
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