The government is set to increase its subsidy expenditure by 17.30 percent from the current year to Tk 27,954 crore in fiscal 2017-18 mainly to supply rice at low price to the poor.

Some Tk 4,546 crore has been earmarked for food subsidy next fiscal year, up 22.17 percent year-on-year.

In the original budget for the current fiscal year, the allocation for food subsidy was Tk 2,821 crore, which was revised upwards to Tk 3,721 crore to accommodate a programme introduced last year to distribute rice at Tk 10 a kilogram to the poor.

In the past few years, fuel and power dominated the government's agenda when it came to subsidies.

But this year and the next, no subsidy has been extended for fuel seeing that the Bangladesh Petroleum Corporation has been making hefty profit on the back of the lower prices in the international market. BPC had received more than Tk 42,000 crore from the government as subsidy in about eight years.

In fiscal 2017-18, the power sector will get a subsidy of Tk 5,500 crore, which is the same as this year.

The government is also cutting back on its subsidy expenditure on energy and agriculture.

The agriculture subsidy was revised downwards this fiscal year as the fertiliser prices in the international market are low. Some Tk 9,000 crore was originally allocated for agriculture subsidy, but it was lowered to Tk 6,000 crore in the revised budget.

However, in the upcoming budget, the allocation was set at Tk 9,000 crore.

There will be no change in the subsidies for exports and jute next fiscal year: they will continue to be Tk 4,500 crore.

Public-Private Partnership (PPP) fund

Some Tk 2,000 crore has been allocated in the next budget for the public-private partnership fund with a view to expediting the projects under the initiative.

In his budget speech in the parliament, Finance Minister AMA Muhith said the government has already created the necessary legal and institutional framework of PPP to mobilise private investment in construction of public infrastructure.

At present, 45 PPP projects are under implementation, where the share of private investment is about $14 billion.

Of the projects, loan agreements have been signed for 9, while 13 are at the procurement stage, according to the finance minister.

Besides, the Bangladesh Infrastructure Finance Fund Limited was established in 2011 to finance physical infrastructure.

The fund has so far provided financing of Tk 2,113 crore to 26 PPP projects.

There are plans to invest about Tk 3,809 crore from the fund in 20 more projects in 2017 and 2018, Muhith added.