Pandemic forces govt to start slashing foreign-aided project allocations

The Economic Relations Division (ERD) has started work on revising the project aid allocations in the development budget amid the impact of COVID pandemic on the project implementation, officials said on Monday.

The ERD would consult with all the government ministries and agencies to assess their project aid requirements in the next seven months of the current fiscal year.

"In most cases, the project work has been hampered due to the coronavirus-related disruptions. So, we have decided to revise the project aid of the ongoing Annual Development Programme (ADP)," said a senior ERD official.

"We will start consultation with ministries and divisions under the agriculture, and rural development & rural institutions sector on November 22. The consultation meeting will continue until November 26," the official added.

The COVID-19 has severely affected execution of the development projects in Bangladesh as the government ministries and agencies have implemented only 12.79 per cent of the ADP in four months (Jul-Oct), the lowest in five years.

The utilisation of the project aid (foreign aid) is much lower than expected during the period.

According to the Implementation Monitoring and Evaluation Division (IMED), all the ministries and agencies during July-October period executed only 11.75 per cent of their total Tk 705.02 billion aid allocations in the ADP for the current fiscal.

The ministries and agencies usually implement foreign aid-supported projects under the ADP where the development partners finance the schemes.

The government framed a Tk 2.14 trillion ADP for FY2021, where it allocated Tk 705.02 billion in foreign aid.

Another ERD official told the FE that every year they revise the ADP cutting the project aid allocations against different projects.

But this year the reality is different as coronavirus has slowed project development work in the last six months, he added.

They were thinking about becoming realistic on the project aid allocations so that the ministries and agencies can implement the remaining work with the highest sincerity, the ERD official said.

He said many foreign-aided projects, including the Japanese large and mega projects, have been affected mostly as the foreign consultants, contractors and workers had failed to continue their work in Bangladesh due to lockdown enforced after the pandemic struck.

The ERD official said, "We have already sought project implementation status from the ministries and agencies."

When they would sit with the ministries and agencies, they would be able to assess the capacity in the remaining period of the current fiscal and then they would reallocate the aid portion, he added.

Since the ADP implementation during the first four months of the current fiscal was not up to the mark, the aid portion might be slashed, he added.

They had requested the ministries to send only the project director and one representative from the respective ministries to avoid gathering in the consultation meeting.

ERD secretary Fatima Yeasmin would preside over the week-long consultation meetings with the ministries aimed at revising the project aid from the ADP.

"After completing the consultation meetings, we will revise the aid allocation in the development budget. Then we will send it to the Planning Commission for finalising the RADP."

[email protected]