Capital spending stays below 30%

By A Staff Reporter,Kathmandu, May 16: The government’s capital expenditure has remained below 30 per cent even with two months left before the end of the current fiscal year.

According to the Office of the Financial Comptroller General, capital expenditure amounting to Rs. 113.84 billion had been made by May 14, 2026, in the current fiscal year. 

This is only 27.91 per cent of the annual budget allocation for the fiscal year. The government allocated a budget of Rs. 407.88 billion for capital expenditure in the current fiscal year.

During the review period, the expenditure rate was lower than in the corresponding period of fiscal year 2024/25. 

The capital expenditure stood at 34.16 per cent (Rs. 120.37 billion) of the total allocation of Rs. 352.35 billion during the first 10 months of fiscal year 2024/25.

Similarly, the government spent Rs. 814.65 billion under recurrent expenditure during the review period, which is 68.98 per cent of the Rs. 1,180.98 billion allocated for the current fiscal year. 

During the same period last fiscal year, recurrent expenditure stood at 67.79 per cent (Rs. 773.22 billion) of the Rs. 1,140.66 billion allocation.

Under the financing heading, the government spent Rs. 245 billion during the first 10 months, amounting to 65.3 per cent of the total allocation of Rs. 375.24 billion.

Government faces Rs. 161 billion budget deficit 

Meanwhile, a gap between the government’s income and expenditure stood at Rs. 161 billion during the first 10 months of the current fiscal year.

During the review period, the government’s total receipts stood at Rs. 1,012.05 billion, which is 66 per cent of the annual receipts target.

However, the government spent Rs. 1,173.52 billion during the review period. It remained in deficit due to expenditures exceeding total income.

The government spent 59.75 per cent of the total budget allocation. It had introduced a budget of Rs. 1,964.11 billion for the current fiscal year 2025/26.

To bridge this gap, the government has been mobilising domestic and foreign loans.

However, the government revised its income and expenditure estimates in the mid-term review of the budget for the current fiscal year.

According to the report, the government’s revenue collection during the review period stood at Rs. 988.55 billion, which is 66.79 per cent of the initial annual target of Rs. 1,480.30 billion.

Out of the total revenue collection, tax revenue stood at Rs. 893.56 billion, or 67.41 per cent of the annual target, while non-tax revenue stood at Rs. 94.98 billion, or 61.51 per cent of the annual target.

Of the total revenue collection target of Rs. 1,480 billion for the current fiscal year, Rs. 1,325.58 billion is expected to be raised through tax revenue and Rs. 154.41 billion through non-tax revenue.

During the review period of the current fiscal year, the government received grants worth only Rs. 17.78 billion, which is 33.28 per cent of the annual target. 

The government has set an annual grant target of Rs. 53.44 billion for the current fiscal year.

Similarly, the government received Rs. 5.71 billion under other receipts during the first 10 months of the current fiscal year.

Meanwhile, the Ministry has revised the revenue and miscellaneous receipts estimate downward to Rs. 1,298 billion for the current fiscal year, compared to the earlier target of Rs. 1,480 billion.