Editorial

A Farce Called 'Budget 2004'

The 2004-05 budget, nicknamed “Peace Budget” by its architect Deputy Prime Minister Bharat Mohan Adhikari, is nothing but a farce in more than a number of ways. Take the example of the restoration of subsidies to the farm sector which was abandoned some years ago after several studies established conclusively that such subsidies benefited only a few of the large farmers.

Simply restoring the discarded system, the leader of the communist faction in the present government has established that his interest is to reward the kulaks even though this may lynch the poor farmers. If the Finance Minister really intended to benefit the poor farmers, he should have supplemented the subsidies policy by outlining imposing taxes on the kulaks and spelling out the method how the administration would be geared to execute these jobs. It is quite clear that the Maoists will not find anything revolutionary in the budget proposals to renounce their violence and join hands with Adhikari in his ‘pious’ deeds.

In the other example of the farce, Adhikari and his budget preparation team have shown their glaring ignorance about what WTO membership and the attached commitments of the country to the world community mean. While the budget has no plans spelled out to meet a number of deadlines in fulfilling the commitments the country has made to the world community, it also lacks any significant programs to enhance the competitiveness of Nepali economy to meet the challenges posed by WTO membership. The deadline to introduce the Competition Law closed on last of July 2004 and the law is still at the draft stage.

Also the catchy slogan of cooperative at each village and employment to every household is a farce as this too lacks budget support.

Had the intention of comrade Adhikari been to protect the interests of the Nepali farmers he should have brought forward some policies and programs to ensure the farmers remunerative prices for their products. It is well known, and as has been emphasized also by the Agriculture Perspective Plan (APP) about which Adhikari has paid some lip service in his budget, that excess production of cereals (goods that have low price as well as income elasticity of demand) will not benefit the farmers. So, he should have announced policies and programs to encourage the farmers to go for products in which the price or income elasticity of demand is high (e.g. high value crops). That should have been bolstered by a public procurement system, both for food grains as well as other products. For foodgrains, the Nepal Food Corporation (NFC) or Salt Trading Corporation could have been used as the state agencies to procure surplus from the farmers. It is vain to expect communists to encourage the private sector.

One excuse that is heard from people who assisted the Finance Minister in preparing the budget is that he did not have sufficient time to do all that he and his party wanted to do. But that is a lame excuse. Adhikari and his party that boasts of having a shadow cabinet, should have their plans and programs ready even when in opposition so that they can start implementing them from the very moment of their assuming the government position.

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