First thing first: These figures are ambitious. The government is unlikely to raise the estimated revenue, unlikely to spend as much as it wants to and is also unlikely to mobilize the projected foreign aid. Year after year, finance ministers have presented ambitious budgets, as if they had a competition with their predecessors to table a budget that is bigger in size and loftier in ambition. It’s only Dr Baburam Bhattarai, who perhaps for the first time since 1990, managed to surpass the revenue target projected in the budget. Thanks to his hard work, moral authority and luck (depreciation of the Nepali currency against the dollar) that helped him achieve the rare feat. But he also failed to mobilize the projected foreign aid and lagged far behind in spending the allocated money.
Against this backdrop, Minister Pandey has increased the size of the expenditure by about 21 percent and revenue by 24 percent. Lack of absorbing capacity of our economy is not a new story. But rarely have we made a genuine attempt to increase the capacity though the finance ministers never fail to raise the size of successive budgets. Even if there were attempts, such as bringing tri-annual budget and advancing the start of the fiscal year to April to facilitate timely awarding of contracts, they have been half-hearted. Even in this budget, the finance minister has allocated money to projects, which failed to make any tangible progress in the last fiscal year, without analyzing the reasons behind the delays. Bizarrely, Minister Pandey has also allocated money to projects that were outright failures. Development is also a learning process but so long as we do not analyze our past mistakes and failures, there is hardly any hope that we will learn from our own experiences and that we will do things differently in the future. This is where most of our failings lie.
There is not much room to criticize the budget for its plethora of social programs except that we are skeptical about the implementation of those programs. Mainlining financial discipline and making sure that such programs reach the intended beneficiary is what we are concerned about. We only hope that the finance ministry shares this concern and works toward that end.
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