Government outlines economic revival plans in annual budget

KATHMANDU: The government has announced a series of targeted initiatives in its new budget to revitalize the national economy.

These measures were presented by Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel during a joint session of the federal parliament on Thursday.

A key priority outlined in the budget is to remove Nepal from the money laundering grey list, which the government views as essential for enhancing economic credibility.

The Finance Minister also highlighted plans to push forward economic reforms aimed at improving Nepal’s credit rating, building on the momentum of the country’s first sovereign credit rating to attract external capital.

Public investment will be directed toward productive sectors, with an emphasis on attracting private capital and technology.

This comes in the context of legal reforms introduced through ordinances aimed at encouraging private sector confidence and creating a more investment-friendly environment.

The budget positions the private sector as a central pillar of economic growth, with the government committing to further policy, legal, and procedural reforms. It also aims to gradually implement the recommendations of the High-Level Economic Reform Recommendation Commission (2081 BS).

To address a potential investment shortfall after Nepal’s expected graduation from Least Developed Country (LDC) status in 2026, the government plans to diversify revenue sources, professionalize revenue administration, and strengthen the tax system.

These measures are also intended to support the country’s progress toward the Sustainable Development Goals by 2030.

Public debt will be utilized in high-yield, priority projects, while alternative and innovative financing tools will be explored to bridge development financing gaps.

The budget also emphasizes improving the trade balance by boosting exports of competitive goods and services, promoting domestic consumption, and attracting skilled Nepali workers abroad to return and engage in entrepreneurship and self-employment.

Special attention will be given to youth-targeted employment, innovation, and entrepreneurship.

“The government is committed to delivering more results based on the positive momentum since its formation, aiming to bring tangible improvements to people’s lives and restore public confidence,” said Finance Minister Paudel.