Wednesday, July 15, 2009

Nepal’s fiscal year 2009/10 budget

There have been a lot of unfavorable reviews of the fiscal year 2009/10 budget presented by Nepal’s Finance Minister Surendra Pandey yesterday. Here is a link to some of the interesting media highlights of the budget. The budget should have been based on the findings of Economic Survey 2008/09, which was released by the government a day before the budget was presented in the parliament.

I think the Finance Minister Surendra Pandey presented the coalition government’s budget for the fiscal year 2009/10 using a spray-gun approach to tackle almost everything but without any concrete direction and clarity. He broke Dr. Bhattarai’s record by presented a mammoth budget of Rs 285.93 billion, which is approximately Rs 50 billion higher than last year’s budget. For the sake of being distinct, the finance minister has simply morphed the Maoist government’s popular and populist programs to fit UML’s economic and political philosophy. However, unlike his predecessor, Pandey avoided setting highly unlikely target of a double-digit growth rate. I will elaborate what I mean by this in the next op-ed. :)

Here are the targets of the budget for fiscal year 2009/10:

Growth rate 5.5%
Agriculture sector growth rate 3.3%
Non-agriculture sector growth rate 6.6%
Total outlay Rs 285.9 billion
Recurrent expenditure Rs 160 billion
Capital formation Rs 106 billion
Revenue generation Rs 175 billion
Revenue-expenditures gap Rs 109 billion
Foreign grant Rs 57 billion
Foreign loan Rs 21.6 billion
Domestic borrrowing Rs 30.91 billion


Below are the annex and full text of the budget:

Budget Speech 2009-10 Annex Budget Speech 2009-10 by FM Surendra Pandey