December 18: The government’s budget deficit has exceeded Rs 70.44 billion in the first five months of the current fiscal year. As of mid-December, the government has spent a budget of Rs 452.98 billion while it has collected revenue worth Rs 382.54 billion during this period.

According to the records of the Financial Comptroller General Office, which keeps track of the government’s income and expenditure, the expenditure of the government is more than the income during the first five months of the current fiscal year.

During this period, the government’s revenue collection stood at 25.45 percent of the annual target while the budget expenditure was 25.87 percent of the target.

For the current fiscal year, the government had announced a total budget of Rs 1751.31 billion. However, the government has not been able to spend the budget according to the target, nor has the revenue been collected.

The government has been reducing the size of the budget through half-yearly review after announcing a large budget and not being able to meet the target.

In the past five months, the government's recurrent expenditure has reached 33.53 percent, capital expenditure has reached 11.94 percent and the expenditure towards financial management has reached 18.52 percent.

The government has allocated a budget of Rs 1141.78 billion under the heading of current expenditure. So far, the government has spent Rs 359.98 billion under this heading.

Similarly, the government has spent only Rs 36 billion out of the allocated budget of Rs 302.7 billion under the heading of capital expenditure.

Meanwhile, the government has set aside an annual budget of Rs 307.45 billion for financial management. So far, the government has spent Rs 56.94 billion under this heading.

According to the data of the FCGO, the government’s expenditure towards financial management was more than the capital expenditure by Rs 20.86 billion in the last month.

The government’s revenue collection is not in line with the target so far. In the current fiscal year, the government has set a target of collecting revenue of Rs 1422.54 billion. This year, the government has set a target of receiving Rs 49.94 billion in foreign grants but has received only Rs 2.75 billion so far, which is only 5.52 percent of the target.

The facts show that government’s targets has been affected by the recession in economy but government officials claim that the economy has started to improve.

Just last week, Finance Minister Dr Prakash Sharan Mahat said in a press conference at the Ministry of Finance that the economic activities of the country have started to run smoothly. Although the finance minister has said that the country's economy is improving in various fronts, the private sector is not ready to accept it. The private sector is saying that a lot of policy changes are needed to improve the economy.

Krishna Prasad Sharma, president of Lumbini Province chapter of the Federation of Nepalese Chamber of Commerce and Industry, says that the problems faced by businessmen due to Covid-19 are still not resolved. According to him, even now the industries are not able to produce according to their capacity.

Stakeholders says that they are in crisis as the government has created a situation of panic by imposing hefty taxes and is unwilling to take corrective measures.