Sustaining growth, reconstruction among top priorities
KATHMANDU, May 26: The government's policies and programs for the next fiscal year will more or less be same as the current fiscal year.
The policy and programs for fiscal year 2017/18 that President Bidya Devi Bhandari read out in the parliament on Thursday does not have any populist programs that can influence voters in the second round of local level elections as agreed among political parties.
Though the policy and programs say that the government will work to sustain projected economic growth of nearly 7 percent of the current fiscal year in the coming fiscal year, economists say that the document is silent on strategies to be adopted to sustain the growth.
Country's economy is projected to grow by 6.9 percent in the current fiscal year, up from less than 1 percent in the previous fiscal year.
Availability of electricity, improved investment environment and better crop yields were the major factors that propelled economic growth above the government's target of 6.5 percent, according to the document.
Economist Chandra Mani Adhikari said that the growth should be counted in aggregate of two years. “To sustain the growth, the government must address factors like low capital spending on projects that leads to capital formation and also creates demand in the market -- a factor that triggers private sector growth,” added Adhikari.
The upcoming budget will allocate resources to local units for the first time as provisioned in the constitution.
The government has announced that the resources will be distributed to local units in a scientific and transparent manner. The policy and programs document says that the government will manage manpower and organize capacity development programs at local units to help in smooth functioning of local bodies.
But the government's policy and programs has not devised any criteria for equitable distribution of resources to local units. The government is still to form National Natural Resources and Fiscal Commission which will recommend to the government on equalization grants to states and local units from the federal fund.
Another continued priority is reconstruction. The government has stated that it would strengthen the National Reconstruction Authority as well as mobilizing newly elected local units for reconstruction work. The previous policy and programs had stated that the government will mobilize the private sector in reconstruction. But it remained in paper only.
Country's private sector, however, does not seem much impress with the government's policy and programs.
The private sector leaders are however not much impressed with the policy and programs.
“Revenue rates and government spending are our concerns. But both of them are missing in the policy document,” Pashupati Murarka, immediate past president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), said. “But we are hopeful of more transparent and effective investment by the newly elected local governments,” he added
Murarka believes that the government would either prepare a full-fledged budget document but unveil only a summary sheet on May 29 and reveal the full-fledged budget after the local elections, or postpone the budget till the second phase of local elections are held.