Kathmandu, June 1: Our political leaders and economic experts who support the present political structure of federalism don’t disclose the reality that the nation’s revenue is unable to burden the present political system. Due to the constant revenue sources, the government is compelled to take public debt every year and now, the compulsion has been created that the government is taking debts to pay back debt instalments and interests. If the present trend continues, it will surely push the country towards bankruptcy.

For the upcoming fiscal year 2082/83, the government has presented a budget of 19 trillion 64 billion 11 crore rupees, aiming to cover the remaining amount through foreign grants, foreign loans, and internal loans, even though it expects to raise 13 trillion 15 billion in revenue. After the revenue collection fell short, the government has been covering its expenses, including development projects, through internal and external loans. The burden of debt has been increasing as the government's expenses have not been fully covered by revenue.

At the beginning of the current fiscal year 2081/82, the total public debt was 24 trillion 34 billion 9 hundred million rupees. By the end of the last month of Baisakh, this had increased by 1 trillion 88 billion 30 hundred million rupees. The Ministry of Finance has stated that in the current fiscal year, the share of foreign debt in public debt is 51.69 percent and the share of internal debt is 48.31 percent.

In recent years, the burden of public debt has significantly increased. By the end of the fiscal year 2075/76, the internal and external debt was only 10 trillion 48 billion, but by the end of the fiscal year 2080/81, the total debt had reached 24 trillion 34 billion. The trend of taking internal and external loans has tremendously increased in recent years. The obligation of public debt in the country has been rising day by day.

In the fiscal year 2076/77, the public debt was 14 trillion 33 billion 40 crore rupees. At that time, the public debt increased by more than 3 trillion in a single year. The public debt reached 17 trillion 37 billion 8 crore rupees in the fiscal year 2077/78. In the fiscal year 2078/79, the public debt increased by nearly 2.5 trillion. By the end of the fiscal year 2079/80, the public debt reached 22 trillion 99 billion 35 crore rupees.

Although there has been some improvement in revenue due to the expansion of economic activities, it is not as expected. The Ministry of Finance has stated that the size of public debt has increased because, compared to public expenditure, revenue mobilization has not been sufficient, leading to pressure on resource mobilization.

For the current fiscal year 2081/82, the government had allocated a budget of 18 trillion 60 billion 30 crore rupees. For this budget, the target was to cover 12 trillion 60 billion 30 crore rupees from revenue and 52 billion 33 crore rupees from foreign grants. The budget mentions that the shortfall of 5 trillion 47 billion 67 crore rupees from revenue and foreign grants would be covered by internal and external loans. In the current fiscal year, the budget was brought to cover 2 trillion 17 billion 67 crore rupees from foreign loans and 3 trillion 30 billion rupees from internal loans. This has now been revised through a mid-term review.

People’s News Monitoring Service.