Fiscal policy to focus on infrastructure, cooperatives, agriculture

The government is focusing its fiscal policy on developing large infrastructure, cooperatives and agriculture.
According to National Planning Commission (NPC) vice chairman Dr Dinesh Chandra Devkota, the government is forming a separate body to look after big infrastructure projects. "The budget will would announce a plan to implement the big projects through a separate special committee," he said, here today.
As the development works have been slowed down due to lack of enough capital expenditure and lack of government’s mechanism, the national think tank vice chair said that a separate committee will look after the big projects to ensure proper capital expenditures and timely completion of the projects that could boost the economic growth.
The government is earmarking sufficient budget -- from its proposed total outlay of Rs 387 billion -- for the large infrastructure projects like Sikta irrigation project and Kankai multipurpose high dam projects apart from Intra-river basin construction and river diversion for electricity generation, water transport and irrigation.
The budget for the fiscal year 2011-12 will introduce programmes for the expansion and restructuring of government mechanism also, he said, adding that the budget will be aimed at completion of peace process and social transformation.
Dismissing the rumours of budget being distributive, he said that the government will bring the budget according to the government policy. "When the budget focuses on big infrastructures, there will be little possibility of budget being distributive," he argued.
He however, defended the move to promote cooperatives claiming that it is also a private sector.
However, the economists and private sector is against the government move to treat cooperatives at par with private sector.
"How could the government compare the private sector that has above 70 per cent contribution in the GDP," asked senior economist Prof Dr Biswambhar Pyakurel.
He also warned the government of economic crisis, if it continues to ignore economic indicators that have been not encouraging in recent years.
Since last three years, the economic growth rate has seen downward movement coupled with higher inflation.
However, the government is bringing a huge budget that will further accelerate price hike, said chairman of Poverty Alleviation Fund (PAF) Bidhyadhar Malik.
He claimed that the government projection of revenue that is at Rs 250 billion is not realistic. "As the government has failed in mobilising Rs 216.67 billion revenue this fiscal year, how could it achieve Rs 250 billion in the next fiscal year," he added.