Bangladesh‍‍‍`s FY24 budget deficit may be in jeopardy: Fitch Ratings

If the growth falls short of the government‍‍`s relatively optimistic estimate, the budget deficit for Bangladesh‍‍`s upcoming fiscal year may be in jeopardy, said Fitch Ratings.

The US-based credit rating agency stated in a report released on Tuesday that Bangladesh‍‍`s fiscal outcomes have frequently varied dramatically from budget estimates, with recurrent underspending against targets.

According to the report, updated data for FY23 indicate that the budget deficit objective should be 5.1 percent of GDP, down from the initial aim of 5.5 percent and Fitch‍‍`s most recent forecast of 5.7 percent.

"This reflected weaker-than-expected spending on development, but also outperformance on revenue collection," the report added.

Due to rising fertilizer, fuel, and natural gas prices around the world, additional subsidy spending—which increased to 2.2% of GDP from the budget‍‍`s original target of 1.8%—was more than offset by these effects, it stated.