सिंहदरबार संवाददाता
Kathmandu. The National Resource Estimates Committee has set a resource ceiling for the upcoming fiscal year 2082/83, allowing for a deficit budget of about Rs 6.5 trillion. While setting a budget ceiling of Rs 19.65 trillion for the upcoming fiscal year, it is estimated that only Rs 12.63 trillion will be received from domestic revenue.
That is, if the budget is brought according to the ceiling determined for the upcoming fiscal year, there will be a resource shortfall of Rs 637.55 trillion. Such a shortfall will be met through internal and external loans and grants. The country’s public debt to GDP ratio is increasing year by year, large amounts are spent on debt repayment, and the amount borrowed is used for current activities rather than capital formation, which are seen as challenges.
If the budget is received and spent according to the limits set by the Resource Estimates Committee, it is seen that the country will incur an additional debt of about Rs 600 billion in the coming fiscal year alone. It is a situation that shows debt as a source to bring a large budget but internal revenue cannot increase every year. If we look at the estimate of government revenue growth for the coming fiscal year, it is around the target set in the budget for the current fiscal year.
However, the Resource Estimates Committee has estimated that internal revenue receipt will increase by 10.3 percent compared to the revised estimate for the current fiscal year. The government had set a target of collecting Rs 1.26 trillion 30 billion in domestic revenue through the current fiscal year budget. However, the revenue target has been reduced to Rs 1.14 trillion 40 billion 26 billion through the mid-term review of the budget. The National Planning Commission Vice Chairman Prof. Dr. Shivraj Adhikari says that the estimated revenue increase of about 10 percent in the coming fiscal year compared to the revenue collection target set through the mid-term review is less than in the past and more realistic.
“Based on the mid-term review of the current fiscal year budget, we have estimated the domestic revenue for the coming fiscal year. In the past, revenue growth was estimated at 20/22 percent. But now we have only done 10 percent. This is realistic and methodical,” he said. It seems that if the limit is set to bring in a budget of around Rs 19 trillion for the coming fiscal year, resources equivalent to around Rs 6.5 trillion will be insufficient.
The said amount will have to be met by raising foreign loans and grants and internal loans. The Resource Estimates Committee estimates that foreign aid will increase by 28.8 percent in the coming fiscal year compared to the current fiscal year. The committee estimates that foreign grants will be Rs 45 billion and foreign loans will be Rs 235 billion and 90 million, respectively. The government had also revised the target for obtaining foreign loans and grants through the mid-term review of the current fiscal year’s budget.
The government’s target for obtaining foreign loans of Rs 217 billion 670 million for the current fiscal year was reduced to Rs 180 billion 840 million through the mid-term review in January. Similarly, the government’s target for receiving foreign grants of Rs 52.33 billion in the current fiscal year has been reduced to Rs 36.63 billion through the budget review. Although the commitment received from donor agencies to provide foreign loans was taken into account when estimating resources for the coming fiscal year, the Commission’s Vice Chairman Adhikari says that there may be some difference in the receipt of foreign grants.
In particular, he says that the issue of whether the amount received through the Millennium Challenge Corporation, which is a US grant aid, will continue or not will also affect the receipt of foreign grants for the coming fiscal year. While showing the sources to meet the deficit budget for the coming fiscal year, the size of the internal debt has also been increased compared to the current fiscal year. The government has set a target of taking an internal loan of Rs 330 billion for the current fiscal year.
For the upcoming fiscal year 2082/83, it is estimated that Rs 357.46 billion can be met by raising internal loans. The practice of bringing a deficit budget is common all over the world and although bringing a budget larger than what can be covered by internal resources is not a matter of criticism, the Commission’s Vice Chairman Adhikari says that where and how the borrowed amount is spent is important.
“There is a practice of mobilizing deficit finance all over the world. Where that amount is spent is important. Criticism in this is a relative matter. “The resource estimates are much more realistic and based on reality than before,” he said.
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