Foreign loan necessary to achieve the goal of building a developed country: Finance Minister Sharma

Published On: June 10, 2022 03:30 PM NPT By: Republica  | @RepublicaNepal

KATHMANDU, June 10: Finance Minister Janardan Sharma has said that the country has to take internal and external loans until it becomes self-reliant by increasing its internal revenue.

Discussing the Public Debt Management Bill, 2076 on Friday at the House of Representatives, Minister Sharma said that the government aims to upgrade the country from underdeveloped to developing country by 2026. Minister Sharma claimed that the capital and overall expenditure allocated in the budget will help to achieve the betterment of the country.

Minister Sharma said that the government needs to take loans to achieve the goal of becoming a developed country by 2026. He said that there is a need to change the practice of borrowing and spending on projects. He complained that most of the loans taken by the government were costly instead of being productive. Minister Sharma said that the current debt, including internal and external debt, stands at Rs 1.74 trillion.

Minister Sharma also mentioned that the government is going to repay the loan of Rs 40 to 45 billion this year alone. He said that the current budget has more financial management in current expenditure than capital expenditure as it has to repay the loan.

Similarly, Finance Secretary Madhu Kumar Marasini said that the government is trying to make it systematic by creating a separate body to look after public debt management. He also said that the ministry is preparing to formulate necessary policies for the same. Secretary Marasini said that the provincial government has to manage the internal loan as it is now available for them.

Likewise, Secretary Marasini said that the system of giving loans to public institutions with government guarantee should be removed. He said that it would be necessary for the government to tighten the system, stating that the government would only allow the public sector institutions to take loans without analyzing the government's ability to repay the loans.

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