After weeks of deliberations, the government gave up its intention to bring out a full budget on Tuesday and agreed with the opposition on a one-third budget instead.
The government should have been preparing for the announcement of a full budget now, which is expected to be approximately Rs 429 billion. The fiscal year ends on Sunday, but the parties have only agreed on a partial plan. The opposition fears that a budget before the election will be a populist one, and there are several debatable issues. It will take them days or even weeks to reach consensus on the nitty-gritty of the budget.
Perhaps we should be glad that at least some progress is being made to bring out the budget. Even if the Bhattarai government had been allowed to bring a full budget, its implementation by a caretaker government would have been questionable.
We should be used to this by now. Since 2006 the country's budget has been held hostage by the opposition on one issue or the other every year, sometimes even ending in embarrassing fist fights. Looking at the trend, we might as well change our fiscal calendar permanently. The economy be damned, the opposition parties will not give up the chance to bargain on the budget.
But halting it will put a major speed bump on the country's development and growth. This delay has come at a time when the confidence of the business community is already seeing a sharp decline. The missed deadline for the constitution crashed hopes of investors who were finally expecting some stability. Banks still have not experienced a rise in credit demands, reflecting the sentiments of the investors. The real inflation rate is estimated to be in double digits now.
The delay and squabbles over the budget represent another lost opportunity for Nepal. No investor, local or foreign, will want to take a chance on a country with a highly volatile political environment where risks seem to crop up at every corner.
The central bank is trying to manage the impact of the European crisis on the economy and rising inflation, and without a budget it will not be able to make monetary policy changes to mitigate the situation. It's sad that our politicians, even former finance ministers, do not realise the magnitude of our economic conundrum.
The partial budget will only take care of regular expenses like social security, salary, debt servicing and projected costs to national priority projects. But the economy is passing through a difficult phase and a timely and complete budget could have given it the boost it so desperately needed.
We can only hope that before the partial budget runs out, the parties will come to an agreement which will in turn help stabalise the country's economy. Fingers crossed.
On a tight budget, RUBEENA MAHATO
Budgetary uncertainties and mass retirement of secretaries will set back governance