Govt again resorts to bank borrowing
The budget for the current financial year has a target of raising Tk25,000 crore from the non-bank sector, of which, Tk20,000 crore will be taken from savings certificates
The government has again gone for borrowing from banks to meet the budget deficit.
It took no loans from the banking sector in the first three months (July-September) of the current fiscal year, rather it paid back around Tk50 crore of its previous debt servicing.
But borrowing again started in October, taking the government's net bank loan to around Tk1,063 crore at the month end.
However, bank borrowing in July-October was much lower than the amount of around Tk36,000 crore in the same period a year ago.
Despite low borrowing from banks, the government's non-bank loans increased by 140% to Tk17,577 crore during July-October of the current fiscal year, up from Tk7,326 crore in the same period of the last fiscal year.
The budget for the current financial year has a target of raising Tk25,000 crore from the non-bank sector, of which, Tk20,000 crore will be taken from savings certificates.
Sales of savings certificates have reached close to the fiscal year's target only in the July-October period with a fall in interest rates on bank deposits.
During the time, the sales of savings instruments increased by 183% to Tk15,642 crore from Tk5,500 crore in the same period of the last fiscal year.
