The National Economic Council at a meeting on Monday revised down the size of the current annual development programme to Tk 2,00,000 crore from Tk 2,30,000 crore, with the social safety, health, transport and communication, and education sectors witnessing massive cuts in allocations.
The revised allocation to the social protection sector stands at Tk 545 crore while the original one was Tk 2,018 crore. To the heath sector, the revised allocation has been set at Tk 4,718 crore, down from Tk 18,148 crore.
The allocation to the education sector has been revised down to Tk 18,562.05 crore from Tk 28,557 crore and the transport and communication sector has seen the allocation cut to Tk 38,332 crore from Tk 58,973 crore.
In the transport and communication sector, the allocation to the Metro Rail Line-5 has been reduced to Tk 592 crore from Tk 1,490 crore and that to the Metro Rail Line-1 to Tk 801 crore from Tk 8,631.43 crore.
The NEC meeting presided over by interim government chief adviser Professor Muhammad Yunus was held at the Planning Commission auditorium at Agargaon in the capital Dhaka.
At a briefing at the same venue, planning adviser Wahiduddin Mahmud blamed the dependency on foreign loans by sectors like health and education for the cuts.
He said that no country could make progress in the education, health and social safety sectors with the help of foreign loans.
Calling the ministries to make scrutiny on foreign loans with the national interests, the planning adviser said that they decided to give priority to projects under the public-private-partnership for foreign loans.
The meeting also decided to make it mandatory for the state-owned enterprises and autonomous bodies to take approval from the executive committee of the National Economic Council for self-financed projects exceeding Tk 50 crore.
The planning adviser said that it was misused during the Awami League regime ousted in August 2024 in the wake of a mass uprising.
He said that cutting allocation to development projects was natural as the implementation rate was slow in the transition period amid political uncertainty.
In the first five months (July-November) of current financial year of 2025-26, the overall expenditure of the ADP stood at 11.7 per cent, less than 12.29 per cent in FY25, 17.06 per cent in FY24 and 18.41 per cent in FY23.
In the revised ADP, the government funding has been cut from Tk 1,44,000 crore to Tk 1,28,000 crore and the foreign loan has been slashed from Tk 86,000 crore to Tk 72,000 crore.
A total of Tk 30,159.55 crore has been allocated under development assistance for special needs in addition to Tk 3,100 crore for five development assistance items under the Local Government Division, Tk 530 crore for the Chittagong Hill Tracts affairs ministry and Tk 100 crore for special areas.
The total number of projects under the revised ADP stands at 1,330. The original ADP included 1,171 projects.
A total of 286 projects have been earmarked for completion by June 30, 2026 in the revised ADP.
The planning adviser observed that it was not the poor implementation of the annual development programme but the lack of investment was to blame for the slow economic activities in the country.
The slowdown in the overall economy is largely because of lack of investment by the private sector, he said, adding that regions and villages with the higher inflow of remittance somehow maintained economic activities.
Calling the bank interest rate a bit harsh for small and cottage industry entrepreneurs, Wahiduddin said that a cut in the rate would have been more beneficial for the economy.
The planning adviser said that they were leaving the responsibility of projects like Metro Rail, Payra Port and Bus Rapid Transit for the next government, to be elected through the February 12 national elections, because of the ongoing scrutiny could not be completed before the polls.
On a ministry and division-wise basis, the highest allocation has gone to the Local Government Division, followed by the Road Transport and Highways Division and the Power Division.
Other ministries and divisions receiving significant allocations include the science and technology ministry, the water resources ministry, the primary and mass education ministry, the Secondary and Higher Education Division, the shipping ministry, the Bridges Division and the railways ministry.
