Budget Implementation in Current Fiscal Year Remains Disappointing Across Provinces

In accordance with the law, all seven provinces of Nepal are set to announce their budgets for the upcoming fiscal year 2083/84 on Monday. Surveys indicate that Bagmati Province accounts for the largest share of Nepal’s Gross Domestic Product (GDP) at 36.7%. However, budget expenditure for most provinces in the current fiscal year has been weak, with Madhesh Province spending only 11.63% of its budget up to Falgun (mid-March). As of 31 Jestha, Kathmandu, while provincial budgets are prepared following the federal budget unveiled on 15 Jestha and prioritize sectors such as governance, agriculture, education, health, and infrastructure, the implementation status of current fiscal year budgets remains unsatisfactory. Provincial governments lag behind the federal government when it comes to budget spending.

On the eve of the budget announcement, Bagmati Province released its Economic Survey for 2082/83, based on data up to Falgun 2082, according to the Ministry of Economic Affairs and Planning. Bagmati accounts for the highest share of Nepal’s total GDP at 36.7%, estimated at NPR 24.23 trillion of the national economy sized at NPR 66 trillion this year. The province’s economic growth rate is projected to exceed the national average. The provincial government is implementing a budget of NPR 6.747 billion during the current fiscal year, yet only 22.30% (NPR 1.505 billion) had been disbursed by Falgun end, marking an 11.93% decline compared to the previous fiscal year 2081/82.

Madhesh Province, which contributes 13.1% to Nepal’s GDP with an economic size of NPR 863 billion, has spent only 11.63% of its budget in the first eight months. Despite this being the largest budget implementation in eight years, only NPR 546 million out of NPR 4.698 billion had been spent by Falgun end.

Koshi Province also released its economic survey ahead of the budget announcement, indicating a 15.8% contribution to Nepal’s GDP, equating to NPR 1.043 trillion. The province is implementing a NPR 3.588 billion budget, but expenditure figures up to Baishakh reveal only NPR 1.307 billion (36.29%) has been utilized.

Karnali Province is operating with a budget of NPR 3.299 billion; however, expenditure figures through Chaitra show only NPR 803 million spent, or 24.35% of the target.

Sudurpaschim Province is managing a budget of NPR 3.639 billion for the current fiscal year, but only NPR 933 million had been spent by the end of Baishakh, accounting for 27.91% of its budget.