The size of the country’s aid pipeline has crossed the $40 billion mark, supported by some big loan deals signed with the development partners.
Economic Relations Division (ERD) data suggest that the aid pipeline expanded to $40.51 billion in the month of October, which was slightly over $36 billion at the outset of the current fiscal year.
In the first four months of 2017-18 FY, development partners made commitments for nearly $5.65 billion against a number of development schemes.
Fund commitments rose to a record high at $17.96 billion last fiscal against the government’s yearly target of $6 billion, mainly thanks to the $11.38 billion loan deal signed with Russia for the Rooppur nuke power plant.
Lack of capacity of the implementing agencies in utilising foreign project money to keep up with the increased fund commitments has been blamed for the unusual swelling of the aid pipeline.
Total fund commitment was $41.97 in last five years with $8.39 billion annual average commitments, whereas the total fund release was $16.09 billion in the said period with $3.22 billion annual average, ERD data suggest.
After some frantic efforts in last few years, foreign fund disbursement rose to $3.59 billion last fiscal, the highest since the country’s Independence.
However, this performance was 86 percent of the year’s revised fund release target of $4,165 million.
For 2017-18FY, ERD had primarily set the fund disbursement target at $5,555 million, but the ERD Secretary has said they expect to get more than $7 billion of funds released at the year-end.
He expects some large fund release for some large projects like Karnaphuli tunnel and Rooppur nuke power plant this year.
More funds are expected to be accumulated in the aid pipeline after signing of the $3.15 billion loan deal with China for Padma rail link project by this December.
Meanwhile, project aid release gained momentum during July-October period this year.
During this period, PA release nearly doubled year-on-year to $1.46 billion including $1,353.5 million loans and $92.3 million grants, up from $744.5 million released a year earlier.
A project implementation committee (PIC) headed by the cabinet secretary was formed at the beginning of the current fiscal year to spur aided project implementations to cut the growing pipeline, ERD officials said.
“The committee already sat with the implementing agencies and the project directors. After that meeting, fund utilisation from project assistance has increased significantly,” an ERD high up, who is on the committee, said.
If big projects are implemented on a priority basis, the fund release will increase further, the ERD official added..