Economy
Proposed Budget Slashes Import Duties on Key Consumer Goods
Finance Minister Abul Hasan Mahmood Ali has presented a proposed national budget of Tk 797,000 crore for the fiscal year 2024-25. This new budget introduces reduced import duties on several goods, leading to lower prices for these items.
The budget was unveiled at a parliamentary session on Thursday (June 6) at 3 pm, presided over by Speaker Shirin Sharmin Chaudhury and attended by Prime Minister Sheikh Hasina.
This marks the first budget for the current government’s fourth consecutive term and the 21st budget under Prime Minister Sheikh Hasina’s leadership. It is also Finance Minister Abul Hasan Mahmood Ali’s first budget presentation.
Goods Expected to See Price Reductions
The proposed budget includes the removal of a 20% supplementary duty on the import of packaged powdered milk, which is expected to decrease its market price. Additionally, a 25% reduction in the duty on chocolate imports will lower chocolate prices. VAT on laptop imports has been removed, decreasing the overall tax from 31% to 20.5%, which will reduce laptop prices.
The import duty on polypropylene yarn, a key raw material for carpet manufacturing, has been cut from 10% to 5%, reducing the price of locally produced carpets. The aviation sector will benefit from reduced VAT on engine and propeller imports, leading to lower maintenance costs for aircraft. Import duties on CKD parts for locally manufactured motorcycles have been reduced, which will lower motorcycle prices in the domestic market.
The import duty on manganese, used in the production of rods, bars, and angles, has been reduced from 10% to 5%, decreasing the cost of metal products. Prices for switches and sockets used in households are expected to drop due to reduced import duties on raw materials for their production. Concessions on parts for electric motor production will also result in lower prices for electric motors.
The budget reduces import duties on raw materials for dialysis filters, decreasing the cost of dialysis. Additionally, a 9% reduction in import duties on circuits will lower dialysis expenses. The prices of spinal syringes and dengue kits will also drop due to preferential import duty concessions.
Budget Overview
The budget theme is “Commitment to Building a Happy, Prosperous, Developed, and Smart Bangladesh.” The proposed budget size for FY 2024-25 is Tk 797,000 crore, a 4.6% increase from the current budget.
The current budget for FY 2023-24 was set at Tk 761,785 crore. The upcoming budget proposes an Annual Development Programme (ADP) of Tk 265,000 crore, compared to Tk 263,000 crore for the current fiscal year.
The overall budget deficit is projected at Tk 256,000 crore, a decrease from the revised deficit of Tk 283,785 crore for the current fiscal year. The target for total revenue is set at Tk 545,400 crore, up from Tk 500,000 crore in the previous year.
For FY 2024-25, the GDP growth target is set at 6.75%, potentially reaching Tk 55,97,414 crore. The current fiscal year’s GDP growth target was 7.5%, later adjusted to 6.5%. The proposed budget aims to keep inflation at 6.5%.
Chief Adviser Prof Muhammad Yunus on Thursday paid tribute to the Armed Forces Division by placing a floral wreath at its headquarters.
Prof Yunus, who visited the division as part of his official duties, laid the wreath to honor the sacrifices and dedication of the members of the Armed Forces.
Following the wreath-laying ceremony, he signed the visitor’s book.
Chief Election Commissioner (CEC) Kazi Habibul Awal, along with four other election commissioners, announced their resignation during a press conference today at the Election Commission (EC) building. The resignation follows growing speculation and pressure.
CEC Awal stated, “In this changed situation, I and other commissioners have decided to step down. We’re handing over our resignation letters to the EC Secretary to send it to the President.” After submitting the letters, the CEC and some commissioners quickly left the premises, with no clear explanation for the absence of two election commissioners.
The resignations come amid increasing unrest tied to the registration of political parties such as Nagarik Oikya and Gono Odhikar Parishad. Sources revealed the CEC felt unsafe due to aggressive behavior from activists, prompting the decision to step down.
Protesters outside the EC building hurled shoes at vehicles carrying Election Commissioners Rashida Sultana, Md Alamgir, and Anisur Rahman as they left. Meanwhile, preparations for their exit had already been underway, with the commissioners reportedly relocating personal belongings from their offices.
The commission, appointed in February 2022 for a five-year term, had previously expressed confusion over demands for their resignation, maintaining they had conducted fair elections. However, internal discussions led to the collective decision to resign earlier than expected.
The government will now purchase LNG from the international spot market through open tender instead of negotiation.
Cabinet Committee on Economic Affairs (CCEA) in a meeting on Wednesday in principle approved a proposal in this regard.
Adviser of the interim government for Finance Dr. Salehuddin Ahmed, who presided over the meeting, said that the government will procure LNG through open tender.
The Energy and Mineral Division of the Ministry of Power, Energy and Mineral Resources placed the proposal where it sought approval to import LNG from 23 listed companies in the international spot market.
The adviser said that though such 23 companies were enlisted by the previous Awami League government and signed Master Sales and Purchase Agreement, they will remain unchanged.
He said that instead of applying the Speedy Increase of Energy and Power Supply (Special) Act 2010, the interim government will follow the Public Procurement Rules 2008 to ensure the competitive bidding process.
“We don’t want to change them as we wanted to import LNG quickly, ensuring proper competition among the suppliers,” he told reporters.
Committee also approved another proposal in principle to sign a contract to import urea fertiliser for the 2024-25 fiscal year from Fertiglobe Distribution Limited, UAE, on a G-to-G basis.
Meanwhile, the Cabinet Committee on Government Procurement (CCGP) in a meeting, presided over by the Adviser for Finance, approved 3 proposals for import of lentil and fertiliser.
As per the proposal, the Trading Corporation of Bangladesh will procure 10,000 metric tons (MT) of lentil from local firm Sahara Enterprise at a cost of Tk 98.20 crore with each kg priced at Tk 98.20.
The Commerce Ministry which moved the proposal on behalf of the TCB in the meeting mentioned in the proposal that the supplier firm was selected through open tender.
The CCGP approved two separate proposals of the Industries Ministry under which Bangladesh Chemical Industries Corporation will import 30,000 MT of bulk granular urea fertiliser from Fertiglobe Distribution Limited, UAE, under state to state contract at a cost of Tk 121.48 crore.
Each metric ton of fertiliser will cost $343.17.
Another 30,000 MT of bagged granular urea fertiliser will be procured from the local Karnaphuli Fertilizer Company Limited (Kafco) at a cost of Tk 116.99 crore with each metric ton costing $330.50.
