FinMin foresees nearly double-digit growth

Kathmandu, February 28

Finance Minister Yubaraj Khatiwada today claimed that the country would achieve economic growth close to double digits in the current fiscal year.

Addressing the third International Conference on Economics and Finance organised by Nepal Rastra Bank (NRB) today, Khatiwada said that the economic indicators in fiscal 2019-20 are positive so far which will trigger higher economic growth.

“Our programmes, policies and plans are focused on alleviating poverty and achieving Sustainable Development Goals (SDGs). As indicators of the economy are positive, the country will record economic growth close to double digits this fiscal year,” he said.

Initially, the government had set 8.5 per cent economic growth for fiscal 2019-20. However, Minister Khatiwada is still optimistic about meeting this growth target despite his own decision to revise downward the budget size for the ongoing fiscal year by Rs 147 billion.

Through the mid-term review of the budget for fiscal year 2019-20, the finance minister had revised down the budget size for 2019-20 to Rs 1.385 trillion from the initial size of Rs 1.532 trillion.

Despite this optimism from the finance minister, Luis E Breuer, senior resident representative of International Monetary Fund (IMF) to Nepal, India and Bhutan, while addressing the NRB conference, said that higher economic growth in the present context is not possible for Nepal.

“Though Nepal has the prospect to grow higher with favourable policies, the country is expected to witness five to six per cent economic growth this year based on today’s policies,” said Breuer.

On the occasion, NRB Governor Chiranjibi Nepal said that it is challenging to achieve the economic growth target owing to the negative impact of the coronavirus outbreak from China in Nepal’s trade and tourism.

Citing that Nepal’s economy could not progress in line with the social and political transformation in recent years, former vice chairman of National Planning Commission Swarnim Wagle said that achieving higher economic growth in the near future is unrealistic. “We have not been able to build a strong and proper base to achieve higher economic growth,” he reiterated.

NRB is organising the twoday conference to discuss economic and financial sector issues with policymakers, practitioners and researchers. The conference has incorporated discussions and deliberations on issues like macroeconomic policies, macro prudential policies, macro-financial linkages, fiscal federalism, public finance, decentralisation, globalisation, international trade and exchange rate regimes.

Other areas that will be discussed on are capital flows, remittance, business cycle, inclusive growth, poverty reduction, income inequality, unemployment, education, health, labour, tourism, energy, payment system, FinTech, RegTech, SupTech, cyber security, financial inclusion, financial access, microfinance finance, green financing, financial development, financial stability, financial consolidation and capital market development.