My Republica, May 31, 2019
The budget unveiled Wednesday for the fiscal year 2019/20 has drawn a mixed reaction from the seven provinces. Some provinces have welcomed the budget for allocating funds for projects prioritized by the provincial governments while others have criticized it for failing to introduce any new programs or to understand the needs of the respective provinces.
Industrialists in Province 1 are excited as the budget addresses their demand for a hike in import taxes on goods available in the domestic market as this will promote domestic products and industries. The industrialists say the budget has accommodated more than a dozen industries in eastern Nepal.
The budget has allocated funds for setting up physical infrastructures for the industrial area in Damak, building the Biratnagar Industrial Corridor and establishing a customs office in Olangchugola. The government has allotted money for several hydropower projects including Upper Arun, Kimathanka Arun and Arun Tamor, and several development projects such as the Mechi corridor, Koshi corridor, Sagarmatha ring road, Devghat-Chatara religious circuit and a feasibility study for a Kakadbhitta electric railway.
Budget fails to address agricultural potential
Leaders and entrepreneurs in Province 2 have criticized the budget for failing to address the agricultural potential in the province.
“The budget fails to address the priorities of Province 2 which is totally reliant on agriculture” said Financial Affairs and Planning Minister of Province 2 Bijay Yadav.
Province 2 leaders and officials said the budget has ignored irrigation and fertilizer issues. They also said the budget has ignored the spirit of federalism by centralizing most of the budget in the federal government.
Excited by new projects
The budget has introduced attractive projects for Province 3, including enhancing connectivity with the northern neighbor. Multiple plans have been proposed for Kathmandu while two big hydropower projects are also prioritized.
The budget has proposed upgrading roads connecting with the national capital and also with Kerung, a major boarder entry point in the north. The budget has announced two industrial areas in the province including Shaktikhor in Chitwan and Mayurdhap in Makwanpur. Similarly, special economic zones have been planned for Panchkhal in Kavre and Nuwakot. Funds have been allocated for completing the Melamchi project.
Budget fails to introduce new projects
Dissatisfaction has surfaced here as the budget has not introduced any new or mega projects for the province. Commentators said the budget has allocated funds only for ongoing multi-year programs.
Tourism entrepreneurs complained that reduced funds for the tourism sector could affect Visit Nepal Year 2020. The budget for the tourism sector has been reduced to Rs 2.68 billion in fiscal year 2019/20 from Rs 5.20 billion in the current fiscal year.
“I didn’t see any new and attractive plans for Gandaki province in this budget,” said Ananda Raj Mulmi, former chair of the FNCCI.
The private sector in Province 5 has stressed the implementation of the federal budget, hailing it as accommodating.
Nepal Chamber of Commerce Province 5 coordinator Ijaz Alam said implementation of the budget is important. “The budget is largely fine. But how the government implements it is more important,” said Alam. FNCCI Province 5 chair Gunanidhi Tiwari said although the budget has accommodated suggestions from the private sector, its success depends on implementation. “Development expenditure has been limited to 26 percent to satisfy everyone. Low development expenditure may result in a liquidity crunch if the government fails to implement the budget effectively,” said Tiwari.
Minister Khatiwada promised funds for the Baubasta industrial area of Nepalgunj and Motipur in Butwal. But entrepreneurs in the province are doubtful over its implementation as the budget has not mentioned any specific amounts. Similarly, locals have welcomed with hesitation the plan for a tunnel way on the Siddhababa road section as no amount is specified for the purpose.
Roads linking China in priority
The federal budget has prioritized roads linking Karnali province with China. Funds have been allocated for the Surket-Hilsa, Surket-Nakchenangla and Surket-Dho road sections.
Road connectivity with Tibet has been hugely prioritized in Karnali province which is the only province not contiguous with India.
“The federal budget is infrastructure-friendly as it has addressed the need for roads and highways in the province,” said Chief Minister Mahendra Bahadur Shahi.
However, Financial Affairs Minister Prakash Jwala said the budget fails to address federalism.
Sudur Paschim Province
Cut in projects alienates people
After the federal budget left out plans for a dry port about to be constructed at Dodhara-Chandani in Kanchanpur, even ruling party leaders in the province have criticized it. “Top ruling party leaders had promised to compensate the province for past neglect. But the budget has ignored Sudur Paschin yet again,” said NCP province committee member Om Prakash Bhat.
Plans for expanding electricity, upgrading a domestic airport and a corridor on the Mahakali River are welcomed by the province.
Former chairperson of FNCCI Kailali Dineshraj Bhandari said the budget has not brought excitement among people in the province as most budgetary promises go unimplemented.