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KATHMANDU: Confederation of Nepalese Industries (CNI) has revealed findings from its analysis of the budget implementation for the fiscal year 2022/23.
The CNI’s programme titled ‘Budget Watch’, conducted a thorough assessment of the economic sector and discovered significant gaps between the intended budgetary allocations and the actual implementation.
According to the report released by CNI, the last fiscal year's budget exhibited a lacklustre execution of vital economic initiatives.
Out of the 62 points outlined in the economic sector in the budget, a mere 18% equivalent to 11 points, were fully implemented. A substantial portion of the remaining points suffered from partial implementation or were not executed at all. Specifically, 47% of the points saw partial implementation, while a concerning 35% went unimplemented.
The report highlights varying degrees of success in different areas. Foreign investment issues have seen some degree of implementation, while sectors like infrastructure, startups, and land development have shown weak or zero progress. Notably, changes in tax rates, tax exemption and discounts related to the Financial Act were swiftly implemented. However, the report emphasizes that policy changes, legal reforms, and structural adjustments have faced significant hurdles, indicating a lack of momentum in transformative reforms.
The government presented budget for fiscal year 2022/23 with a target of spending Rs 1.79 trillion, but only Rs 1.43 trillion (79.7% of the target) was spent, according to the report. Although Rs 380 billion was allocated for capital expenditure, only Rs 234 billion (61.54% of the target) was spent. It shows that nearly one-third of the capital amount was not spent.
In the previous fiscal year, the government achieved only 72% of the revenue collection target of Rs 1.40 trillion. The overall laxity in revenue and expenditure management underscores the weaknesses in budget implementation.
On the occasion, CNI President Rajesh Kumar Agrawal stressed that the Budget Watch initiative was launched to creatively contribute to the effective implementation of the budget, enhance capital expenditure trends, and support overall economic growth. 
CNI has proposed 73 points related to the private sector and economic prosperity, categorised into areas such as industrial development, investment promotion, infrastructure, tourism, agriculture, domestic production, and export promotion, as well as tax regime adjustments.
Government officials also weighed in on the findings. Chief Secretary Baikuntha Aryal acknowledged the government's supportive role in the private sector's endeavours, highlighting the need for collaborative efforts to reduce business and production costs.
Mukunda Prasad Niroula, Secretary of the Ministry of Industry, Commerce and Supplies, mentioned plans to update outdated laws based on current relevance and address budget constraints for micro, domestic, and small industries.
Ramkrishna Khatiwada, CEO of Nepal Infrastructure Bank, shared insights into industrial park development, citing a growing number of parks since 2001. He noted, however, that despite the government's allocation of land for industrial infrastructure, utilisation remained below expectations. As Nepal aims for sustainable economic growth, these findings underscore the imperative for more effective budget planning, allocation, and implementation strategies.
