According to a preliminary estimate by the finance ministry, the government may slash the ADP by 23 percent but it may increase the revenue budget by five percent.

Overall revenue in the revised budget may decline but non-tax revenue may increase due to recovery of illegal money from corrupt people.

Already Tk 270 crore illegal money of seven businessmen has been retrieved and deposited in the national exchequer. The government expects that a handsome amount would be recovered from the same people in the next two months.

Finance ministry officials already made preliminary changes in the current budget early this month, and sources said there would be a few more changes after consultation with different ministries.

The original budget for the current fiscal year (FY06-07) is Tk 69,740 crore, and the revised estimate has set the figure at Tk 65,570 crore, by cutting Tk 4,170 crore, sources said.

As per the preliminary estimate, the government may cut the ADP by Tk 6,000 crore and set it at Tk 20,000 crore. And non-development expenditure may rise to Tk 45,570 crore from Tk 43,740 crore now.

On the increase of non-development expenditure, sources said government payment against interest on foreign and local loans is the main reason for the rise.

In the original budget, the government allocated Tk 7,640 crore as interest on foreign and local loans but in the revised budget, total interest payment may stand at Tk 9,050 crore.

Besides, government borrowing from the banking sector is increasing every year. Borrowing was Tk 76,795 crore till February this year as against Tk 45,162 crore in FY 02, according to Bangladesh Bank data.

Another reason for non-development expenditure rise, one source said, is that expenditure has increased in subsidies sector because of a number of reasons that included the previous government decision to provide 100 percent basic salaries of non-government primary school teachers.

Moreover, a huge amount of money was spent on election preparations, and Bangladesh Petroleum Corporation (BPC) was allocated a big chunk from the budget.

Implementation of the ADP is very poor in the current fiscal with only 25 percent of the allocated funds spent until December last.

Finance ministry officials think the pace of ADP implementation has not increased after that. Besides, the present caretaker government is very strict about release of funds for development projects. The government is scrutinising projects and their justification before releasing funds, they pointed out.

Sources said receipt of foreign aid was less in the current fiscal year mainly because of political unrest and a number of conditions imposed by the donors. As per the data of first eight months of the fiscal year, the amount of foreign aid was 38 percent less than in the previous year.

The revised budget is going to put foreign aid at Tk 5,280 crore instead of Tk 8,370 crore in the original budget.

The government is also considering revising revenue collection to Tk 49,200 crore from Tk 52,540 crore in the original budget.

NBR tax was estimated at Tk 41,000 crore in the original budget and it is now going to be reset at Tk 37360 crore.

The budget set non-NBR revenue growth at 11 percent but the first seven months of the fiscal year witnessed only four percent growth.

This government however increased its non-NBR revenue collection figure to Tk 10,070 crore from Tk 9,630 crore.

Sources said a number of people have deposited illegal money in the government exchequer, which boosted non-NBR revenue.

The government showed Tk 2,210 crore to be received from the sale of Rupali Bank as deficit financing.