Budget to be unveiled on July 16
Kathmandu, June 29:
Finance secretary Bhanu Prasad Acharya today disclosed to The Himalayan Times that the ordinance budget for fiscal 2004-05 would be released on July 16. Despite a finance minister yet to be appointed by the government, led by Prime minister Sher Bahadur Thapa, the ministry of finance is all set to release the ordinance budget. Amidst continuing political uncertainties and complete lack of ministers, the ministry of finance is going ahead on its own with budget preparations. Constitutionally speaking, the timeframe for the release of the ordinance budget can not be delayed than July 16, said Pramod Karki, joint secretary at the ministry of finance, who looks after legal affairs in the ministry. Four ordinances such as the economic ordinance, appropriation ordinance, national debt ordinance and loan and guarantee ordinance will be released during the budget period, informed Karki.
He said that these ordinances would be sent to the cabinet for approval first and then forwarded to the Royal Palace for the Royal seal, confirming it as the ordinance budget for the next six months. Suggestions from responsible institutions are also being submitted to the ministry of finance on the forthcoming budget. According to a source at MoF, economic growth rate in the coming fiscal 2004-05 would stand at five per cent on the basis of 3.8 per cent inflation and balance of payments surplus at seven billion rupees as per the suggestions, submitted by the Nepal Rastra Bank (NRB) recently. The central bank has predicted that in the forthcoming fiscal, domestic borrowings would increase by 12.5 per cent against an increment of 7.8 per cent in the current fiscal, says a MoF source. The central bank has figured that due to the Maoist insurgency, economy has been affected badly, as conflict has stopped all rural construction-related works.
Similarly, due to the lack of locally-elected representatives, investment at the local level has not increased. This has also led to loans being received from the World Bank lying idle with the government, says a MoF source. The central bank suggests that the ministry of finance should control regular expenditures and increase development outlay, says a MoF source. The source also disclosed that the government will spend Rs 89.35 billion in cash term. It has been estimated that regular expenditure will account for Rs 63.15 billion in the coming fiscal. During the current fiscal, expenditure has been revised at Rs 59 billion.
As per government sources, total revenue mobilisation will touch Rs 68.70 billion, which is an increment by only 0.3 per cent. The budget deficit is likely to be over Rs 15 billion, on the basis of the predicted amount of government expenses at Rs 89.35 billion and total resource mobilisations at Rs 73.85 billion. Estimated budget deficit will increase by 20.2 per cent compared to fiscal year 2003-04. Private sector lending is estimated to rise by 15 per cent in the coming fiscal compared to 10.5 per cent in 2003-04. During the current fiscal, food grains production grew by 5.2 per cent which is expected to increase by 3.5 per cent only. Total import are projected to increase by 14.5 per cent and supply of imported goods will be ample.