Dr Bhattarai Makes a Clean Breast of it

In a press meet here today, Finance MInister Dr Baburam Bhattrai admitted that the Maoist-led government had failed to control the price hike. The government budget had projected a 7.5 per cent price hike for the current fiscal year but Nepal Rastra Bank (NRB) statistics show it has been in double digits throughout the year — 13.5 per cent in the tenth month of current fiscal year.

“I am not satisfied with our performance,” he said, “It is a fifty-fifty case of success and failure.” The government succeeded in changing the image of revenue offices like custom and inland revenue and managed a record revenue collection of Rs 108.03 billion till May 8. MoF strictly implemented the 92-point economy pact made nine months before.
But, it failed to mobilize the development budget.

It could spend only Rs 23.177 billion, which is 25.37 per cent of the total development budget of Rs 91.31 billion. The government could not realize people-centric programmes due to lack of local bodies, said Dr Bhattarai.

However, it bailed out 268,259 small farmers from bank debts by spending Rs 5.535 billion. In his budget speech last year, Dr Bhattarai had announced a bail out for small farmers who could not repay loan below Rs 30,000 and interest and fine in loan upto Rs 100,000.

The government distributed Rs 100,000 each to families impacted by the Maoists’ armed conflict.

Clearing the international community’s doubts about the Maoist-led government, Dr Bhattarai said the Ministry of Finance (MoF) signed foreign assistance of Rs 43.13 billion, Rs 38.25 billion as donation and Rs 4.88 billion as debt.

The government significantly reduced the domestic loan. Though it had proposed Rs 25 billion as domestic loan in the budget, because it managed to collect Rs 8.7 billion revenue till May 8 it reduced the need for domestic borrowing, he said.

Dr Bhattarai hoped the coming government would follow his polices and programmes of ‘New Nepal Campaign’. The Maoist-led government has programmes for building EastWest Highway in hill area, laying rail network in the Tarai, self-employment programme for youth and initiating cooperative movements throughout the country. “We failed to initiate mega projects but I do hope the new government will work on it,” he added.

Dr Bhattarai experienced ups and down in his tenure as finance minister. His much vaunted Education Service Tax failed under pressure from private educational institutions whereas the Voluntary Declaration of Income Source (VDIS) got success in collecting revenue of Rs 1.52 billion.

The private sector is skeptical of the Maoist-led regime because of its cooperatives promotion policy.