Nepal’s development spending short of even half of annual allocation
Summary
Nepal's government spent only 46.79 percent of its capital budget in the fiscal year 2025-26, the lowest in six years, due to political disruptions, protests, and supply issues, slowing infrastructure development and economic growth.
Key Points
- The government spent only 46.79 percent of the capital budget allocated for fiscal year 2025-26, the weakest development spending in six years.
- Political disruptions, including Gen Z protests and federal elections, along with supply issues from West Asia, hampered capital expenditure.
- Economists criticize the current government for failing to prioritize development spending despite promises of good governance from the Gen Z movement.
- Revenue collection increased by 7 percent but still fell short of targets, partly due to weak capital expenditure affecting tax revenues.
