September 18: The Ministry of Finance is facing mounting challenges to secure funds for the upcoming elections. The revenue collection of the government has slumped in recent months due to the ban imposed on the import of luxury goods following pressure on the foreign exchange reserves. As a result, the finance ministry is struggling to secure funds for the election as well as for other purposes.
Data show that the government has been collecting revenue worth Rs 1 to 2 billion a day. The government’s expenditure is almost Rs 14 billion a day.
Records maintained by the Financial Comptroller General’s Office show that the government collected revenue worth Rs 1.54 billion last Friday while it spent Rs 5.6 billion the same day.
Officials of the finance ministry admit that they are facing problems in securing funds for the election due to the disparity in government’s income and expenditure.
Financial advisor to the ministry, Dr Shalikram Pokharel, says that the entire economy has been affected by the ban on import of luxury goods by the government.
“The ban has helped Nepal shift towards self-reliance but the revenue collection has been hampered because we have an import-oriented economy,” said Pokharel.
The government had imposed a ban on import of luxury goods since last winter to ease the pressure on the foreign exchange reserves. It has directly affected the revenue collection of the government. Officials of the ministry say that the revenue collection will pick up pace as the government has lifted the ban on six out of tem items since September.
According to Pokharel, the increase in inflow of remittance in recent days has improved the foreign exchange reserves which can now sustain imports for at least eight months. The ministry believes that this will help in securing funds for the election and also to improve the overall economy.
The government is also seeking support from donor agencies to secure funds for the election in terms of technical assistance. Finance Minister Janardan Sharma has been requesting foreign delegates to support the country financially for the election. However, sources at the finance ministry say that despite official letters sent to various countries seeking financial assistance for the election the government has only received assurance so far. It is still not certain whether Nepal will receive financial assistance or not.
It is estimated that around Rs 20 billion will be required for holding the elections on the scheduled date and to make security arrangements for the election. The ministry is yet to secure funds to this end.
However, it has been learnt that the ministry is planning to secure funds or Rs 10 billion for the November 20 elections. The Election Commission has sought more than Rs 11 billion from the government.