Kathmandu, April 6
The government has announced plans to make policy, structural and operational reforms to transform and strengthen the country's economy.
As highlighted in the coalition's priorities and minimum common programmes related to the economy, the government has announced plans to make the economy dynamic by restructuring the budget system in terms of policy, structure, and function to resolve the issues seen as a result of the recession in the economy, decline in industrial production and business sector, investment risks, tightening liquidity situation in the financial sector, high interest rate, increasing trade deficit, low capital expenditure, decreasing revenue collection and decline in the capital market, etcetera.
The government has also stressed prioritising the development of agriculture, water resources, and tourism for the development of the national economy. Priority has been given to conducting comprehensive economic programmes, including development and construction on the basis of a coordinated, cooperative and active role of government, cooperatives, and private sector.
It has also announced the allocation of resources according to the fiscal federalism.
The government has also committed to encouraging domestic investment and attracting foreign investment, creating an investmentfriendly environment, and flowing foreign aid and subsidies in the areas of productive and physical infrastructure development.
For this, the state will amend economic laws and regulations as necessary to ensure an investment-friendly environment and make foreign loan payments transparent while also establish special economic zones in each province to accelerate industrial development.
The ruling coalition has also committed to making the revenue administration agile, sincere, and taxpayer-friendly and ending illegal activities like smuggling and hundi transactions, and bringing the informal economic activities into the formal sector to increase the scope of revenue.
While keeping in mind the fact that the government's revenue is not able to cover even the ordinary expenses, the government will distribute the work responsibilities, provide manpower and resources, eliminate the departments of the union unless necessary, and solve the problem of overstaffing.
The government has also decided to give special importance to agricultural farms, contract farming, and cooperative farming to alleviate poverty through modernisation, mechanisation and commercialisation of agriculture. The government will also arrange agriculture and distribute Farmers' Cards to provide subsidies as well as fertilisers, technical education, etcetera.
To minimise the risk of crops being destroyed by natural disasters the government will arrange agricultural insurance and contribution-based pension schemes for farmers.
Similarly, the government has also remarked on attracting domestic and foreign investment by prioritising sustainable natural resources and energy development as well as providing round-the-clock quality electricity in production centres and industrial areas.
It is also mentioned that the government will move forward with bilateral and multilateral dialogue with neighbouring countries for the export of electricity.
The ruling coalition has announced to develop the country as an international tourist destination through the development of infrastructure and to develop and manage the quality of service providers such as hotels, travel agencies, and trekking agencies in the tourist area, to develop cultural, biological and geographical diversity as the main area of tourism.
Priority will be given to industrialisation to transform the current economy, which is highly dependent on remittances into a productive economy.
Emphasising the development of import substitution and export promotion industries, the government has expressed plans to industrialise the country by combining capital, labour, and entrepreneurship.
Similarly, the government has also committed that it will arrange special packages and industrial security to re-operate sick industries.
In order to increase the government's capital expenditure, the government will make the decision-making process of contracts transparent, accountable, and quick, solve the compensation disputes that have arisen in the acquisition of real estate, and create projects so that cultural heritage areas are not encroached upon.
The government will also reduce foreign travel, construction of new buildings, purchase of vehicles, and office operating expenses.
Furthermore, emphasis has been given to making the balance of payments positive and reducing the trade deficit by implementing import regulations and export promotion strategies.
A version of this article appears in the print on April 7, 2023, of The Himalayan Times.
