I have already presented
before this august House, the Economic Survey, annual progress details of the
Line Ministries for the current Fiscal Year and the progress review of the
Public Enterprises for the last Fiscal Year.
These reports have not
demonstrated the economic indicators as satisfactory. Nepali economy
experienced non-economic obstacles at the time of poor economic growth due to
low investment, weak productive sector and structural weaknesses. The economy
further shrunk due to earthquake damage and disruption in the supply system.
There is a preliminary
estimates of only 0.8 percent economic growth in the current Fiscal Year due to
delay in budget implementation, economic sluggishness seen in private sector
related to industry, construction and trade and decline in food production
because of the unfavorable weather. Consumer price inflation has remained at
about 10 percent.
There was an estimated loss
of Rs. 700 billion caused by the earthquake. Additional loss has been incurred
due to disruptions in the supply system. There is a need of the mobilization of
resources equivalent to Rs. 813 billion for the post-earthquake reconstruction.
The revised expenditure for
the current Fiscal Year is estimated to be as Rs. 701 billion (85.6 percent)
against the allocation of Rs. 819 billion. Of this expenditure, recurrent
expenditure is estimated to be Rs. 434 billion (89.6 percent), capital
expenditure Rs. 159 billion (76.2 percent) and financing Rs. 108 billion (85.5
On the resource mobilization
front, the revised revenue collection for the current Fiscal Year is estimated
to be Rs. 460 billion (96.8 percent) against the target of Rs. 475 billion. Of
the target of mobilizing Rs. 205 billion from the foreign aid sources, only Rs.
126 billion (61 percent) is estimated to be mobilized.
Both the import and export
of commodities in the current Fiscal Year have declined. Although the trade
deficit seems to be lower than the previous year, export can only meet one
tenth of the import value. External sector is positive except the trade
deficit. Balance of Payment is surplus by Rs. 163.81 billion at the end of the
first nine months of the current Fiscal Year. Similarly, Foreign Exchange
Reserve of Rs. 1007.61 billion is registered in this period. Remittance inflow
in the first nine months of the Fiscal Year increased by 13 percent over the
same period of previous Fiscal Year to reach Rs. 481.69 billion.
There has been an
improvement in the investment climate. Internal capital market has strengthened
gradually. Stock market has been dynamic due to excess liquidity in the capital
market. However, challenges remain in the mobilization of financial resources
towards productive sector. NEPSE index has been above 1500.
Following are the objectives of this budget:-
• to implement the Constitution,
• to revive the economy affected by the earthquake and
the supply system disruption,
• to attain high economic growth through increasing
productivity and production,
• to promote domestic and external investment,
• to expand economic activities, increase income and
employment and reduce poverty,
• to create
opportunities, capacity building and social protection,
• to provide quality social service to all Nepali people.
While allocating budgetary resources, I have given
priorities to the following areas:-
• Post-earthquake reconstruction, rehabilitation and new
• Hydro power generation, transmission line expansion and
• Road, airport, irrigation
• Agriculture, industry, tourism, forest
• Urban and local infrastructure
• Education, health, drinking water, sanitation
• Social security
• Service delivery, corruption control and governance