The government has decided to suspend fund release for implementation of low-priority projects under the Annual Development Programme (ADP) of this fiscal year (FY), 2020-21.
The decision has been taken amid low revenue collection and increased spending during the Covid-19 pandemic period that seriously halted economic activities in the country.
The Finance Division budget wing on Wednesday issued a notification regarding prioritising projects, fund spending and their proper implementation.
The government earmarked Tk 2.05 trillion for the ADP in this FY, under which 1,584 ongoing projects and 1,443 fresh projects are included for implementation by all the ministries and agencies.
At the same time, the government classified the projects as high-, medium-, and low-priority ones for optimum use of limited resources.
The notification said the ministries, divisions and departments will continue implementation of high-priority projects.
In case of the medium-priority projects, the ministries, divisions and departments will spend money, if they found it compulsory. In this case, they were asked to avoid spending money as much as possible.
For the low-priority projects, the notification said fund release will remain suspended for the time being.
However, the rules will not be applicable in case of the projects, being implemented by the Ministry of Agriculture and the Ministry of Health and Family Welfare, it added.
Contacted, an additional secretary of the Finance Division told the FE that dearth of resources is the main reason that pushed the government to take such a decision at the very beginning of a fiscal year.
In the last fiscal, the National Board of Revenue (NBR) had a revised target of Tk 3.0 trillion. But it could collect nearly Tk 2.15 trillion, a gap of nearly Tk 850 billion.
"This fiscal we want to release fund by observing the trend of revenue collection."
The overall sign of economic recovery is not promising, as the pandemic is still expanding its grip and slowing down commercial activities in the country, he added.