Himalayan News Service
Kathmandu, March 9:
According to government statistics, during the last six months of fiscal year 2004-05, expenses under various headings such as current expenses, capital expenditure and education have increased. As a result, development expenses have also gone up by over 52 per cent.
Development expenses have reached Rs11.49 billion compared to Rs 7.52 billion during the same period last year. Rise in development expenses is attributed to allocation of budget in prioritised projects, said ministry officials.
The minister for finance, Madhukar SJB Rana said that current expenditure of the government in the last six months has touched Rs 25.81 billion and capital expenditure is at Rs 6.80 billion. â€œIn principal and interest payment, the government spent Rs 4.38 billion,â€ minister informed a gathering of journalists today. The minister informed that a major portion of money, Rs 6.33 billion has been spent on the education sector.
During the previous year, regular expenditure was Rs 25.55 billion while in the six month period of current fiscal year it has been Rs 25.51 billion. Rana predicted that revenues would increase by 16.6 per cent and reach Rs 72.70 billion at the end of the current fiscal year. Revenue collections will be at a rate of 99.2 per cent on the tax/revenue side, while non-tax revenue recovery would be at the rate of 95 per cent, he added.
Dr Shankar Sharma, vice-chairman of the National Planning Commission (NPC), said that foreign aid will not be diverted if we have the capacity to utilise it effectively by prioritizing projects and controlling corruption. Dr Sharma said that agreements on foreign aid over the past six months has reached Rs 13.93 billion.
Even agreements regarding loans has been to the tune of Rs 9.19 billion. Foreign aid in this fiscal, compared to the same period last year, has gone up by 59 per cent, according to the ministry.
The government claimed today that as per commitments made to the World Bank in regard to Poverty Reduction Support Credit (PRSC), reforms are being carried out effectively. The government has not received any letter regarding the suspension of aid from WB under the PRSC, informed Dr Sharma.
Governor of Nepal Rastra Bank (NRB), Bijay Nath Bhattarai said that the government has not taken an overdraft from the central bank as it has a surplus of Rs 3.60 billion in deposits. He said that the Indian budget would also have an impact on Nepal.
Rana said that the Indian budget will have implications for textile and agriculture sectors of Nepal as India has given subsidy to its domestic industries. We need to be more competitive for exploiting our tremendous potential in regard to China and India, opined Rana.
The government predicts the GDP growth rate at four per cent, followed by 3.4 per cent in agriculture sector and 4.3 per cent in non-agriculture sector during this fiscal year. Inflation would remain at 4.3 per cent, predicts the report.
Finance secretary Bhanu Prasad Acharya said that development expenses, revenue collection and other economic indicators are positive from broader economic perspectives.
Government officials feel that there is a need to contain inflation, reduce regular expenditures, effectively implement public expenditure management programmes and medium term expenditure reform programmes and lobby for getting credit from the World Bank and Asian Development Bank (ADB).