Finance Minister Dr. Yuba Raj Khatiwada Friday presented the annual budget for the fiscal year 2020/2021 primarily focusing on resolving the ongoing crisis triggered by the COVID-19 pandemic. Of the total Rs. 1.47 trillion budget, a significant portion has been allocated for the health, agriculture, reconstruction, infrastructure, social security, employment generation and relief package, among others, in light of the coronavirus breakout. The extended lockdown, enforced to contain the spread of coronavirus since March 24, has upended the government’s plan to sustain economic momentum based on the encouraging growth of last two years. So the budget has mainly set out two goals - saving the lives of people and reviving the sagging economy. Seemingly, they look contradictory tasks – if the steps are taken to open economic activities, people are at greater risk of catching the virus. On the other hand, if the lockdown is given continuity, people’s economic woes will get amplified beyond recall. Therefore, Minister Dr. Khatiwada has tried to maintain sound balance between the two tricky missions while providing social security and relief package necessary to instill confidence in the commoners hard hit by the virus’s surge.

Even if the volume of budget is justifiable, the reduction in the capital expenditure may give bad impression. Only 23.9 per cent of it will be spent on the development works while a whopping 64.4 per cent, almost two-thirds, will go for meeting the recurrent expenditure. Like the previous budget, the resources for the expenditures will be managed primarily through the internal revenues, and domestic and foreign loans. Of course, this is the traditional pattern of budget outlay that needs to be altered for attaining self-sufficiency and inclusive prosperity. Undoubtedly, the budget document contains oodles of brighter elements, including the hefty allocations for the restructuring of the health and agriculture sectors. The government has earmarked Rs. 90 billion for the health sector. Of it, Rs. 6 billion has been allocated for the procurement of health equipment and medicines, and expansion of services for the prevention and treatment of COVID-19. The decision to provide health insurance worth Rs. 500,000 as incentive to each health worker is quite appreciative because they are now on the frontline against the pandemic.

The allocation of Rs. 41.40 billion for the commercialisation, modernisation and mechanisation of agriculture is expected to secure self-reliance in food, vegetables and fruits. More importantly, increased investment and incentives in agriculture will attract thousands of Nepali migrant workers set to return home owing to the global corona crisis. The business community must have cheered up as Rs. 60 billion has been earmarked to provide relief in forms of cash, subsidy, tax and fine discounts and concessional loans. The budget seeks to create 500,000 additional jobs that is a daunting task but not impossible. Generating 200,000 employment opportunities by injecting Rs. 14 billion into The Prime Minister Employment Programme is right approach but the government must keep an eye on checking the possible abuse of tax payers’ money. With the government covering social security costs of the private sector workers for the lockdown period, the latter will feel a respite. Overall, the budget is geared for reviving the troubled economy, trade and tourism essential to get life back to normal.