Kathmandu, Apr.15: His Majesty’s Government Council of Ministers has ratified the economic reforms package containing restructuring of our economic and fiscal sector, decentralization, improvement in civil service, effectiveness of foreign aid, the role of civil society, etc.
The package has been ratified with the objective of effecting radical changes in the state machinery and economic policy in view of the widespread slackness in socio-economic sector of Nepal.
The package ratified by the Council of Minister is scheduled to be presented at the Nepal development forum meeting being held from April 17 to 19 in Paris, the capital of France.
Talking briefly to rss at Tribhuwan International Airport before departing for Paris today, Finance Minister Mahesh Acharya said policy and other reform programmes were initiated for economic development after the restoration of democracy in the country, but this sector has witnessed slowdown for the past few years due to political instability and social tensions.
Advancing further the economic reform programme, refining the state machinery, creating jobs and income-generating opportunities, ensuring economic growth rate, increasing investment and building an atmosphere conducive to increasing government revenue are the challenges of the day, said the minister, adding, responsible political parties of the country should now be serious about building institutional capacity to intensify development and the strategies to be adopted for overcoming development challenges.
The reform package programme aims to increase the ratio of public revenue and Gross Domestic Production (gdp), maintain government expenditure at a certain level, not to allow the gdp and net internal loan ratio to exceed 0.5 percent, bring auditing of fiscal and industrial sectors at par with international standard, frame laws about liquidation of industries and give top priority to implementing a three-year budget system.
Similarly, His Majesty’s Government will promote a liaison body for the effective utilization of foreign aid based on Nepal’s development priority, develop state ownership in coordination and management of foreign aid, ensuring long-lasting and effective partnership between government and the donor community and mobilize internal resources.
The present government is highly serious about intensifying the development process through the judicious and skillful use of foreign aid, he further said.
In the present context when domestic resources are deficit and direct foreign investment is not increasing as expected, Mr Acharya stressed the need to increase investment within the country, build infrastructures, ensure economic growth, raise the living standard of the people and use foreign aid for providing facilities to the people and ensuring their interests.
A system will be pursued to determine national priorities and issue foreign aid amount through the Finance Ministry, he said
His Majesty’s Government will amend the act regulating foreign exchanges, ensure fiscal reforms, restructure Rastriya Banijya Bank and Nepal Bank Ltd, strengthen the monitoring by the Central Bank, improve the structure of non-banking fiscal body and develop capital market, says the reform package, fiscal management will be revitalized for increasing our loan payment capacity.
For the development of the private sector, government’s interference will be reduced and a privatization act will be worked out for the institutionalized development of the private sector, time-limit for taking decisions on privatization will be shortened and the process will be simplified.
An anti-corruption drive will be launched, accountability of local bodies in matters of development increased and the bodies that works for social development consolidated, it is stated.
Similarly, policies will be pursued to make civil service strong, effective and productive, tone up the administration, redefine the role of ministries, departments and other offices, the Finance Minister said, adding vat will be consolidated to mobilize public revenue, new income tax laws framed, the tax administration strengthened and the vat and tax departments integrated.
Minister Acharya further noted that improvement in revenue mobilization will help broaden the tax base and the improvement in monitoring and supervision will help pluck revenue leakage.
Likewise, His Majesty’s Government will reduce its general expenditure, select and evaluate projects, improve the information system, and adjust the release of budget with the budget project and programme, said the minister adding, the office of the Auditor General and the National Planning Commission will be made effective in expenditure management.
The reform programme also aims to share public means and resources in alleviating poverty, promoting jobs, developing agriculture and irrigation and building rural infrastructure.