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A proposed Tk 2.0-trillion Revised Annual Development Programme (RADP) for the current fiscal year will be placed before the National Economic Council (NEC) today for approval, marking a 7.41-percent decline from the FY25 RADP and the lowest revised development outlay in the past five years.
Planning Commission sources say Tk 300 billion - equivalent to 13.04 per cent of the original Tk 2.30 trillion ADP - is set to be slashed, citing tightened fiscal space and slower-than-expected implementation progress.
The NEC meeting will be held at the NEC auditorium in the capital, with Chief Adviser Professor Dr Muhammad Yunus in the chair.
"The allocation cuts are not arbitrary. They reflect slower spending, limited fiscal space, and the need to prioritise high-impact projects," says Planning Adviser Dr Wahiduddin Mahmud.
He also says approving the RADP on time is crucial for stabilising project execution and avoiding the rush seen in previous years.
According to the proposal, the revised development budget will be financed with Tk 1.28 trillion from domestic sources and Tk 720 billion from external sources in the form of loans and grants.
The original ADP of Tk 2.30 trillion allocated Tk 1.44 trillion from domestic resources and Tk 860 billion from external financing.
As part of the revision, allocations from domestic sources are set to be reduced by Tk 160 billion, while external project aid and grants are set to be cut by Tk 140 billion.
A review of the time-series data shows the RADP increased to Tk 2.1 trillion in FY22 from Tk 1.98 trillion a year earlier.
It remained above Tk 2.0 trillion in subsequent years, making the proposed RADP for FY26 the lowest in the past five years.
The planning adviser has attributed the contraction mainly to poor utilisation of funds by ministries and divisions during the first quarter, alongside revenue shortfalls and foreign financing constraints.
According to Implementation Monitoring and Evaluation Division (IMED) sources, all the ministries and divisions spent only Tk 264 billion, 11.48 per cent of the total ADP allocation, in the first five months of the fiscal year.
The rate was the lowest in the last 10 years, says an IMED official.
Officials say the Finance Division formally conveyed the revised ceiling to the Planning Commission after reviewing implementation trends, revenue performance, and foreign-aid disbursement prospects.
The Planning Commission, in consultation with the Economic Relations Division (ERD), finalised the project-wise allocations, prioritising the ongoing and near-completion schemes while curtailing funding for slow-moving and underperforming projects.
"When I review individual projects, costs have escalated sharply - some by as much as four times the original estimates - while timelines have tripled. This slow execution forced us to reconsider allocations and trim the budget accordingly," says the planning adviser.
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