Finance Minister Clarifies: Budget Alone Is Not the Sole Basis for 7% Economic Growth Rate
Summary
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- Finance Minister Dr. Swarnim Wagle stated that the 20 trillion NPR budget alone is not the sole source for achieving the economic growth rate and that Nepal’s economy is approximately 70 trillion NPR in size.
- The government aims to expand Nepal’s economy from 70 trillion NPR to 100 trillion and ultimately 150 trillion NPR within the next seven years.
- The government’s budget strategy is to facilitate economic activity expansion by developing infrastructure and attracting private sector investment.
May 30, Kathmandu – Finance Minister Dr. Swarnim Wagle has clarified that the belief that the government’s 20 trillion NPR budget alone can achieve the targeted economic growth rate is incorrect.
Speaking at a press conference held at the Ministry of Finance, Wagle noted that Nepal’s economy has reached nearly 70 trillion NPR, and the government’s focus is on expanding the overall economy rather than just concentrating on the 20 trillion NPR budget.
He emphasized that the government is committed to dispelling the misconception that spending 20 trillion NPR alone will generate a 7% economic growth.
“The government’s 20 trillion NPR budget facilitates the economy, but the economy itself is approximately 70 trillion NPR. During the budget formulation, we always centered on the entire 70 trillion NPR economy, not just the 20 trillion NPR budget. It is important to understand that the 20 trillion NPR budget alone does not drive the economy but rather mobilizes the 70 trillion NPR economy,” stated Finance Minister Wagle.
According to him, essential infrastructure and services such as roads, electricity, peace and security, and the justice system that the government develops will boost the confidence of the private sector, which in turn will attract private investment and expand economic activities.
Wagle further shared the government’s goal to grow Nepal’s economy from 70 trillion NPR to 100 trillion and ultimately to 150 trillion NPR over the next seven years. The government’s investment will serve only as a catalyst for this expansive economic growth.
“Some political leaders mistakenly believe that budget spending itself is the primary basis for economic growth, but that is not true. The government’s 20 trillion NPR expenditure is a means to provide the necessary initial energy and facilitation within the economy,” Wagle explained. “Confidence in the private sector grows because of the roads the government builds, electricity it produces, peace and security it maintains, and an effective justice system it ensures. This confidence attracts private investment and increases private sector activity.”
He also mentioned that the government does not plan to operate an all-encompassing investment and operational model in all sectors but prioritizes a strong and effective regulatory state concept.