Terming the slash of budget allocation in energy and power sector as a result of government’s inability to implement mega projects on time, experts concerned in the energy sector on Thursday said that it will not result any ‘significant’ change in the sector.
The government has reduced down allocation for power and energy sector by 9.5% from the revised budget of the outgoing fiscal.
A total of Tk 15,035 crore has been allocated for the sector in the proposed budget of fiscal year 2016-17 as against Tk 16,614 crore in the revised budget of FY 2015-16.
Talking with energynewsbd.com, Prof Dr Shamsul Alam, energy advisor of Consumer Association of Bangladesh (CAB) said that that allocating budget for a sector was one issue and spending money wisely and methodically for the development of the sector was another.
“We have to understand that most of the mega projects in the energy and power sector are being implemented with the help of foreign financing. Though government allocations supplement that foreign funding, getting that foreign money is not an easy task. So, the implementation of projects gets delayed and the money remains unspent. That’s why the budgetary allocation was decreased this year,” he added.
He said that the government has a number of mega projects in its hand. “For the implementation of those projects, huge money will be needed. In most cases the government has gone for export credit agency (ECA) financing now which has complex terms and conditions. So spending money from the development budget in power sector will not be an easy task.”
Prof Alam however said that this increase and decrease in budget will not affect anything at consumer level. “The reduction and increase of budgetary allocation in energy and power sector do not have any direct correlation at any effect at the consumer level.”
Energy expert and Bangladesh University of Engineering and Technology (BUET) professor Dr Ijaz Hossain meanwhile said that the future of power and energy sector will be hampered without capacity building.
He said that the size of the sector is increasing thus it needs increased amount of investment. "Not only that, for proper implementation of the projects, right person is needed to be choose and engaged for certain works," he said adding that proper corporate culture has to be incorporated here.
About no provision of subsidy for BPC in this year`s budget, Ijaz said the profit which BPS makes since last year should be monitored for expenditure.
Dr M Tamim, Professor of Mineral and Petroleum engineering of BUET told energynewsbd.com that there were several reasons for this relatively smaller budgetary allocation for the power and energy sector.
These included the government’s intention of grabbing more private investment rather than spending from its own funds, failure to spend money from last year’s budget and the decreasing price of oil in the international market, he said.