Govt to transfer Rs 582.83bn to provinces and local levels for FY 2025/26

KATHMANDU: The federal government will send Rs 582.83 billion to provinces and local levels through financial transfers for upcoming fiscal year 2025/26.

Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel, in the budget presented at a joint session of the Federal Parliament, stated that this amount will be transferred to provinces and local levels through revenue sharing and grants.

"Based on the recommendations of the National Natural Resources and Fiscal Commission (NNRFC) for fiscal equalisation grants, Rs 60.66 billion will be transferred to provinces and Rs 88.97 billion to local levels," said Minister Paudel. "For conditional grants, a total of Rs 241.81 billion has been allocated, with Rs 30.35 billion for provinces and over Rs 21.14 billion for local levels."

Similarly, for infrastructure project implementation, complementary grants of Rs 3.28 billion have been allocated to provinces and Rs 10.06 billion to local levels. For special grants, Rs 3.27 billion has been allocated to provinces and Rs 9.78 billion to local levels. Finance Minister Paudel also stated that arrangements have been made to transfer conditional, special and complementary grants based on performance.

While presenting the budget statement, the Deputy Prime Minister estimated that Rs 165 billion will be transferred to provinces and local levels from revenue sharing in the upcoming fiscal year. Thus, the federal government is estimated to send a total of Rs 582.83 billion to provinces and local levels through financial transfers and revenue sharing.