Bangladesh on Thursday announced a $22 billion budget for the 2011-2012 financial year, aimed at spurring economic growth to seven percent and checking runaway inflation. Finance Minister A.M.A Muhith unveiled the 1.635 trillion taka budget for the fiscal year, which starts July 1, projecting a 26 percent rise in spending but warning "unpopular decisions" might be needed in the months ahead.
Muhith said seven percent growth would be achieved through major spending boosts for energy and infrastructure - areas long seen as drags on the economy - which would help attract more foreign direct investment. "We will be able to achieve seven percent real GDP growth next year which can be increased to eight percent in 2014-15," Muhith told parliament.
The South Asian country's economy grew 6.66 percent in the last financial year, according to official figures, driven by a 42 percent expansion in export earnings and gains in the agricultural sector owing to favourable weather. Inflation has soared to a 31-month high of 10.67 percent and foreign currency reserves are drying up fast as import costs and the fuel subsidies bill soars.
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