Amid resource crunch, govt allocates 5.59 percent more funds for its expenditure plans
KATHMANDU, May 30: The government has announced its total expenditure plan of Rs 1.964 trillion for the fiscal year 2025/26, which is 5.59 percent more than the budget earmarked for the current fiscal year.
Presenting the annual budget for the next fiscal year in a joint session of the federal parliament on Thursday, Finance Minister Bishnu Prasad Paudel unveiled the budget, which surpassed the ceiling of Rs 1.9 trillion set by the National Planning Commission. The government was able to unveil its financial plan after the opposition parties showed flexibility allowing the government to present the budget amid protests seeking the resignation of Home Minister Ramesh Lekhak.
Of the total amount announced in the budget, Rs 1.18098 trillion (60.1 percent) has been allocated under recurrent expenditure. Citing the growing criticism for its excessive spending on unproductive segments and the slow growth rate of revenue collection, the government has reduced the regular expenditure by a nominal amount this time. For the current FY, the government has allocated Rs 1.14066 trillion under the heading of recurrent expenditure.
Likewise, the government has earmarked Rs 407.89 billion (20.8 percent) for development expenditure. Although the government has been struggling to utilise the capital expenditure, the allocated amount for the next FY is Rs 55 billion in excess compared to Rs 352.35 billion for the current FY.
For financial management, paying back the interest and principal of the public debt, the government has earmarked Rs 375.24 billion. In the current FY, the amount stands at Rs 367.18 billion under the heading. There has been a notable rise in the funds allocated for the principal and interest repayment on the public debt almost every year mainly due to massive surge in both the domestic and external loans taken by the government. In the FY 2023/24, a total of Rs 307.45 billion was allocated for debt servicing provision.
Govt estimates to spend Rs 1.530 trillion in current FY, less b...
Of the allocated expenditure, the government has targeted to finance Rs 1.315 trillion from revenue mobilization. Likewise, the government has expected to receive Rs 53.45 billion in foreign grants. For the shortfall amount of Rs 595.66 billion, the government has projected to collect Rs 233.66 billion in foreign loans and Rs 362 billion from domestic borrowing.
According to Finance Minister Paudel, the government has rendered more priority to sectors like entrepreneurship, employment, increase in production and productivity, investment in high-yielding quality physical infrastructure, qualitative reform in social sector, balanced development, and assurance of social security and people-friendly service and corruption control in the budget.
Meanwhile, the government has aimed to achieve an economic growth rate of six percent, while maintaining an inflation rate at 5.5 percent for the next fiscal year. These macroeconomic targets are similar to the projected figures for the current FY.
Ministry-wise budget allocations
Ministry of Education, Science and Technology: Rs 211 billion
Ministry of Health and Population: Rs 95.81 billion
Ministry of Culture, Tourism and Civil Aviation: Rs 13.85 billion
Ministry of Forests and Environment: Rs 18.61 billion
Ministry of Communication and Information Technology: Rs 7.72 billion
Ministry of Youth and Sports: Rs 6.08 billion
Ministry of Women, Children and Senior Citizens: Rs 2.08 billion
Ministry of Energy, Water Resources and Irrigation: Rs 86.01 billion
Ministry of Physical Infrastructure and Transport Management: Rs 152 billion
Ministry of Urban Development: Rs 118 billion
Ministry of Water Supply: Rs 33.89 billion
