The government looks to reduce the current expenditure in terms of percentage of the total outlay in the next three fiscal years as per the 'medium-term macroeconomic outlook' presented by Finance Minister AHM Mustafa Kamal along with the national budget on Thursday.
According to the medium term (from FY 20-21 to FY 22-23) outlook, the net borrowing and investment will go up.
The GDP growth rate is projected at 8.2 pre cent for FY '21, 8.3 per cent for FY '22 and 8.4 per cent for FY '23.
For FY '23, the investment target is set at 35.6 per cent of GDP -- 27.7 per cent from private sector and 7.9 per cent from public sector.
An analysis of the outlook shows that the current expenditure would be 54.9 per cent, 54.4 per cent and 54.5 per cent of the total budget for FY 20-21, FY 21-22 and FY 22-23 respectively. The figures were 61.6 per cent in FY '17 and 56.7 per cent in FY '19.
Current expenditure consists of wages and salaries paid to the government employees, purchase of goods and services, subsidy and transfer payments and interest paid for domestic and foreign loans.
According to the medium term outlook, the pay and allowances of the public sector employees will be Tk 869.8 billion in FY '23, which is 12.5 per cent of the total budget.
In the proposed budget for the next fiscal, the amount is Tk 650 billion, which is 11.6 per cent of the total outlay.
In the budget for the current fiscal year, 2019-20, the allocation against pay and allowance was Tk 607.5 billion, or 12.2 per cent of the total outlay.
In FY '16, the allocation for pay and allowances was 16.7 per cent of the total budget and it was 14.8 per cent in FY '18.
External borrowing is projected at Tk 855.8 billion in FY '23 against Tk 561 billion of the current fiscal.
The bank borrowing will also remain high in the coming three fiscals. According to the outlook, it will be Tk 849.8 billion for FY '21, Tk 802.0 billion for FY '22 and Tk 947 billion for FY 23.
However, according to the medium-term framework, the capital expenditure in the next three fiscals will be just above 45 per cent of the total outlay on an average.