‘Despite Shortcomings in Good Governance and Transformation, Opportunities for Doubt Can Be Leveraged’

Former Prime Minister Dr. Baburam Bhattarai has stated that although the upcoming budget appears attractive, it neglects investment in fundamental sectors such as education, health, and agriculture. He emphasized that the private sector alone cannot propel the economy, highlighting the need for a state-protected East Asian development model for Nepal. While the budget’s proposals on information technology and digital service delivery are positive, he noted that the existing structural framework will make it difficult to achieve targeted economic growth.

Dr. Bhattarai explained that despite the appealing presentation and outlook of the government’s budget for the coming fiscal year, it creates similar disappointment regarding the structural transformation of the economy. According to him, the budget prioritizes information technology and digital services but overlooks investment in essential sectors such as education, health, and agriculture. He stressed that without state protection, the private sector cannot enable the economy’s ‘take-off,’ and pointed out Nepal’s need for an East Asian development approach.

In a brief discussion about the strengths and structural weaknesses of the budget, Dr. Bhattarai remarked that although the language and presentation of the budget are appealing, there is no significant change in the overall structure. He argued that approximately 20 percent of the budget should be allocated to education, 10 percent to health, and 8–10 percent to agriculture. However, the current budget allocates only around 10 percent to education, 2–5 percent to health, and about 3 percent to agriculture.

Expressing the view that the budget fails to address the transitional phase of development, Dr. Bhattarai stated, “To make a qualitative leap in our transitional economy—from agriculture to industry and services—targeted investment in specific sectors is essential.” Although the budget presentation is attractive, he warned that the absence of structural reforms will make it difficult to guarantee good governance.