Public Finance

Every government has its own financial management. In the case of a government, how
much on what areas will be the probable yearly expenditures of the government and
how that money can be arranged from which sources are discussed in the public
finance.

Government has to spend a lot of money for overall development of the
country in various sectors like- roads, bridge, government educational institutions,
government hospital, law and order, defence, social infrastructure etc.Government
collects money to bear these expenses from different sources like- income tax, tat, gif
tax, import custom, export custom, saving certificates, prize bond, treasury bill etc. In
public finance, first the amount of expenditure is determined and then fund is collected
according to the needs.

The main objective of public finance is social welfare. Public
finance is usually non-profitable. Expenditure may be greater than income in public
finance. There exist a number of business organizations under government ownership,
which may be less profitable also, for example: chemical industries under BCIC. Again,
large amount of money is required for big projects like Jamuna Bridge, if total amount
of money is to collect from government budget. On many occasions, financial crisis
may occur to the government due to public expenditure for social and state security. For
that reason, many times the government collects foreign loan from organizations like
ADB (Asian Development Bank), World Bank, IDB (Islamic Development Bank), etc.
But at the time of sanctioning the loan, such organizations impose different types of
conditions, which may not be consistent with the need of the country’s development
and image protection. Considering this conditions, government wants to collect fund
from other sources. Now-a-days, big projects are financed worldwide and also in our
country through public-private cooperation. This type of arrangement is called PPP
(Public Private Partnership).

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