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Nepal: Finance Minister Presents Rs 337.9 Billion Budget for FY 2010/11
Source: nepalnews.com
Source Date: Saturday, November 20, 2010
Focus: Internet Governance
Country: Nepal
Created: Nov 23, 2010

Finance Minister Surendra Pandey presented an outlay of Rs 337.9 billion for the fiscal year 2010/11 Saturday evening.

FM Pandey delivered the budget speech from the National Planning Commission hall in Singha Durbar at the presence of the Prime Minister, ministers, senior government officials, leaders of ruling parties and some economists.

The budget was presented through the ordinance after the Maoists prevented him from presenting it in the parliament on Friday.

According to the Finance Minister, the budget has given priority on continuing previous fiscal year's programmes and completing the development projects rather than on new programmes.

Of the total appropriations, Rs. 190.32 billion (56.3 percent) has been proposed for recurrent expenditure and Rs. 129.54 billion (38.3 percent) for the capital expenditure. Similarly, 5.4 percent or Rs. 18.42 billion has been proposed for the repayment of principal.

The estimated spending is 30.4 percent higher than last year's preliminary estimate of revised expenditure. In terms of the structure of the expenditure, recurrent expenditure has increased by 25.8 percent and capital expenditure by 44.8 percent.

Rs. 178.61billion (52.9 percent) has been allocated for development programmes and Rs. 159.29 billion (47.1 percent) for general administration.

Of the total sources of financing estimated at Rs. 281.99 billion required to meet the expenditures for current fiscal year, Rs. 216.64 billion will be met from revenue and Rs.65.34 billion will be from foreign grants, leaving a deficit of Rs. 55.91 billion. Of the total deficit, Rs. 22.23 billion will be financed from foreign loans, and Rs. 33.68 billion from domestic borrowings.

Meanwhile, the government has projected 4.5 pc economic growth in 2010/11 and aims to limit inflation to 7 percent. Inflation rate remained at 8.9 in September-October this year.

The government has come up with some changes in the tax provisions.

According to the Finance Minister, 40 percent tax exemption has been proposed in income accruing from investment in the construction and operation of infrastructure development sectors like roads, bridges, airports and tunnels. Similarly, procedures involved in the development of cable cars will simplified. This is intended at attracting investment in infrastructure development, he said.

Similarly, 25 percent rebate in tax payment will be given to people who earn income out of export of goods produced by using local raw materials.
The education sector has become the highest absorber as the ministry allocated Rs. 57.65 billion for the education sector. This allocation is 17.1 percent of the total budget.

The government has also decided to observe Fiscal Year 2010-11 as "Tax Implementation Campaign Year".

Likewise, "High-Level Public Enterprises Management Board" has also been proposed to ensure policy consistency and effective monitoring for reforming overall management of public enterprises.

Other key aspect of the budget is the continuity to be given to the completion of the detailed feasibility study of Nijagadh International Airport.

Likewise, infrastructure of Pokhara, Gautam Buddhha, and Janakpur airports will be developed for operating international flights.
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