Nepal | August 05, 2020

Govt should only focus on priority projects: WB

Himalayan News Service
Share Now:

Kathmandu, April 22

The World Bank has suggested the government to focus only on priority projects and programmes amid the resource deficit that the government is facing currently.

Addressing a media conference organised by the Society of Economic Journalists Nepal (SEJON), Faris Hadad-Zervos, World Bank’s country manager for Nepal, said that the government will need much more resources in the aftermath of the coronavirus and thus it should ensure that budget spending is focused only on priority projects and programmes.

“As the spending is going to be huge, there needs to be prioritisation of spending to bridge the resource gap,” said Faris, adding that the World Bank is working with the government to support Nepal tackle and recover from the pandemic.

First, the government should prioritise immediate health response and social assistance.

“Many overseas Nepalis will be returning home, which will demand creating a large number of jobs. The Prime Minister Employment Programme and other such programmes should be focused,” said Faris, adding that the World Bank is shifting 18 per cent of its portfolio projects’ budget in Nepal towards COVID-19 response.

The World Bank has also suggested the government to focus more on the production sector to ensure availability of goods, facilitate small and medium scale industries and ensure that the supply chain remains intact.

“The world, South Asia and Nepal are going to see significant drop in the gross domestic product (GDP) growth in the ongoing and next few years,” said Faris.

Before the pandemic, the GDP in South Asia was expected to grow at 6.3 per cent. But as the result of the COVID-19, the region is likely to see GDP growth between 1.8 to 2.8 per cent in the 2020 fiscal year, which will be the worst growth rate in the last 40 years, as per the World Bank.

Similarly, the GDP growth in South Asia is expected to remain moderate in 2021 fiscal year at 3.7 to 4.2 per cent.

“Though Nepal is located between two big neighbours, because they themselves have witnessed reduction in growth, this will also leave an impact on Nepal,” said Faris.

“The recession caused by the coronavirus pandemic is different in the sense that usually recession impacts investment and demand for goods and they are demand-driven.

But the current recession due to coronavirus is supply-driven,” said Faris, further explaining that the world today is reeling due to supply disruptions.

Faris said that understanding this recession differently will help economies use different, new and unique tools to revive economy and growth.

As per World Bank’s projection, the GDP in Nepal is expected to grow between 1.5 and 2.8 per cent in the ongoing fiscal year, while the growth would be roughly three per cent in the 2021 fiscal year.

The World Bank expects remittance, foreign exchange, employment and migration, trade and tourism sectors will be directly affected in Nepal by the COVID-19 pandemic.

As per the World Bank, Nepal’s inflation will quicken to above six per cent in the current fiscal due to the supply shock, while both fiscal deficit and the current account deficit are expected to widen.

A version of this article appears in e-paper on April 23, 2020, of The Himalayan Times.

Follow The Himalayan Times on Twitter and Facebook

Recommended Stories:

More from The Himalayan Times:

Sushil Bhatta appointed IBN CEO

KATHMANDU: Sushil Bhatta, a member of the National Planning Commission, has been appointed as the chief executive officer of Investment Board Nepal (IBN). The Cabinet meeting on Monday decided to appoint Bhatta to IBN’s top post which was vacant since then CEO Maha Prasad Adhikari was appointed Read More...

Pakistan must hit the ground running against England: Misbah

Pakistan will have to hit the ground running if they are to have any chance against England in their three-test series which starts on Wednesday, coach Misbah-ul-Haq said. Six months since their last test match, Pakistan go into the games at bio-secure venues in Manchester and Southampton aga Read More...

MoHP lists swab collection centres in Kathmandu; urges public to follow safety guidelines

KATHMANDU: The Ministry of Health and Population on Tuesday announced 14 swab collection centres to facilitate extensive testing of coronavirus infection in Kathmandu valley at a time when new cases have been on the rise. MoHP has urged the public to visit the swab collection centres from 9:00 am Read More...

Gai Jatra: Festival that honours the memory of those departed

KATHMANDU: Gai Jatra, literally translated to the festival of cows, is observed by bereaved families by taking out procession in memory of the ones they have lost. People, especially children, walk in different costumes, and the processions are also accompanied by traditional bands. Gai Jatra is Read More...

A woman carrying an umbrella crosses a flooded street as it rains in Mumbai

Heavy rain batters India's Mumbai disrupting rail and road traffic

MUMBAI: Authorities in the Indian city of Mumbai issued a red alert on Tuesday and warned people not to venture out after heavy overnight rain in the financial hub brought flooding and travel chaos. Some suburbs have seen more than 300 mm of rain in the 24 hours to Tuesday morning and more heavy Read More...

Nepal’s COVID-19 count crosses the 21k mark, 259 new cases detected on Tuesday

KATHMANDU: The Ministry of Health and Population has recorded 259 new cases of the coronavirus infection on Tuesday, taking the nationwide count to 21,009. The new infections were confirmed after testing 7,687 specimens through PCR method across the nation in the last 24 hours. Among the new c Read More...

Nepal COVID-19 Update: 259 new cases, 65 recoveries, one fatality recorded today

KATHMANDU: Nepal’s Health Ministry, in its regular press briefing, shared the latest updates on coronavirus contagion from across the country, and government’s response to the health crisis. As of today, 406,494 tests through Polymerase Chain Reaction (PCR) method have been carried out, w Read More...

Nepal logs one more COVID-19 fatality; death toll reaches 58

KATHMANDU: One more person has succumbed to the coronavirus infection, confirmed the Ministry of Health and Population (MoHP) at its regular media briefing, on Tuesday. A 77-year-old male from Biratnagar Metropolitan City-5, Morang, has died from the highly contagious disease on Monday. The pa Read More...