The government has downsized the budget for this fiscal year by 12.62 percent to Rs 1.530 trillion.
Through the mid-term review of the budget on Monday, Finance Minister Prakash Sharan Mahat reduced the allocated expenditure by Rs 221.05 billion for the fiscal year 2023/24. Earlier, on May 29, 2023, the government unveiled an annual budget of Rs 1.751 trillion. The revised budget is 87.38 percent of the previously announced budget.
In the revised estimation, the government has projected to spend 88.84 percent of the actual regular expenditure worth Rs 1.141 trillion. Similarly, the government has estimated to spend 84.13 percent of Rs 302.07 billion under capital expenditure and 87.39 percent of Rs 307.45 billion under financial management.
Speaking at a program on Monday, Finance Minister Mahat said the government has lowered the expenditure target citing the shortfall in the government revenue collection. “In addition, the expenditure side has also not improved as expected,” he said.
The government has also revised the revenue collection target to Rs 1.309 trillion from Rs 1.422 trillion. The expected amount in foreign grants has also been reduced to Rs 40.12 billion from Rs 49.94 billion. The projected foreign loans have been revised from Rs 212.75 billion to Rs 180.83 billion.
Almost every year, the government has been introducing an inflated annual budget that includes ambitious programs just to gain popularity. But the implementation side appears pathetic due to inefficiencies in the government system.
Mostly, the budget size is largely curtailed via the mid-term review, which is done after six months of the starting of a fiscal year. In the past one decade, mainly the government’s tendency to spend capital expenditure appears to be pathetic. In the last fiscal year too, the expense for development projects was only 61 percent of the allocated amount.
Despite curtailing the budget size heavily, Finance Minister Mahat claimed that the economic activities are likely to improve in the coming days. He defended his claim stating that almost all the macroeconomic indicators have posted improving results in recent days.
