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VOL. 27, NO. 44, July18 , 2008 (Shrawan 03 2065 B.S.)
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BUDGET 2008
Interim Arrangement
The promise of new Nepal through economic development received a jolt as the govt failed to even bring a proper budget
By SANJAYA DHAKAL
Despite the high-sounding promises by political parties regarding their commitment to build a peaceful and prosperous new Nepal, their beginning has dashed people's expectations.
Experts and economists have joined their voices in flaying the political leadership for failing to bring a full-fledged budget at this critical moment. This is the first time in the six-decade-long history of budget in Nepal, that the government has failed to bring a proper budget.
As Finance Minister Dr. Ram Sharan Mahat presented advance expenditure bill instead of full-fledged budget at the Constituent Assembly (CA) meeting on Monday (July 14), they have said that the message will not be received well by people expecting huge economic strides in the aftermath of the promising political changes.
"This is a very sad day for those who wished for development," said Binod Chaudhary, a leading industrialist and a member of Constituent Assembly (CA). "We hope that this does not become a precedent for the years to come. The time has already come to bring the economic issues to the centerstage of national debate," said Rajendra Kumar Khetan, another prominent industrialist who is also a CA member.
Former Finance Minister Dr. Prakash Chandra Lohani said it was the failure of the political leadership that a full budget could not come.
On its part, the government has said that it could not bring a budget before the annual policies and programs of the government, which, in turn, could not be presented as there is no head of state. As such, FM Dr. Mahat unveiled the advance expenditure bill, which allows the government to spend up to Rs 73 billion till a budget is presented by the new government.
The Constituent Assembly, Monday, unanimously, passed the advance expenditure bill presented by the government. The passage of the bill now allows the government to carry on with routine financial activities beginning July 16 when the new fiscal year begins.
Finance minister Dr Ram Sharan Mahat had presented the advance expenditure bill to act as an interim budget of Rs 73.5 billion for the new fiscal year 2065-66, which will be replaced by a full-fledged budget to be presented by new government later.
The interim arrangement about the budget allowing the government to collect revenue and spend its resources was presented at the constituent assembly Monday. The full-fledged budget could not be presented due to delay in formation of new government.
The tax plans, and economic policies of the budget presented last year will get continuity until a complete budget is presented by the new government.
Briefing about the current economic situation and macroeconomic indicators, Minister Mahat said that current fiscal year recorded 5.6 percent GDP growth – highest in the last seven years. Agriculture sector registered 5.65 percent growth while non-agriculture sector registered 5.57 percent growth.
The gross domestic saving increased to 11.5 percent, up from 9.7 percent last year. The government hopes that revenue generation by the end of this fiscal year would increase by 22 percent more than initial estimation.
Likewise, the foreign assistance has substantially increased from Rs 37.2 billion in the last fiscal year to Rs 57.6 billion in the current fiscal year. The government debt, during this period, has decreased from Rs 329 billion to 324 billion.
During the current financial year, the general expenditure of the government increased by 24 percent and the capital expenditure by 31.6 percent. Dr Mahat also expressed hope that the new government will take into consideration the demand raised by the government employees for salary increment. The new government, possibly led by CPN (Maoist), will adjust the expenditure made during this period while tabling the full-fledged financial bill.
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