September 22: While addressing the nation during the Constitution Day celebrations, Prime Minister KP Sharma Oli had made an ambitious announcement of expanding the country’s economy to a staggering Rs 5 trillion.
The prime minister said that the size of the economy is currently Rs 3.5 trillion and the government will ensure it grows to Rs 5 trillion by the end of the current government’s five-year term.
Meanwhile, the National Planning Commission (NPC) has not said anything officially about expanding the Gross Domestic Product of the country as it prepares to launch its 15th five-year plan. However, Prime Minister Oli’s announcement seems to be based on the papers of the 15th five-year plan.
The unpublished documents of NPC reveal that the country has set a target of expanding the country’s economy to Rs 5769 billion by the year 2033/34. To attain such figures, the country needs at least one and a half decades but the Oli government’s five-year tenure is almost half complete, with just two and a half years left. Economists have termed Oli’s claims as highly ambitious as the government is unlikely to meet the target if the NPC documents are to be taken into consideration.
For the government to achieve its target within the next few years, it requires a complete overhaul of the existing mechanism and a massive increase in foreign investment.
The liquidity crisis in the banking sector, dwindling foreign investment and the private sector’s distrust toward the government can act as an hurdle in achieving the mammoth target.
Economist Keshab Acharya says that the first hurdle in achieving the goal lies within the government.
“The government has not been able to spend the capital expenditure. The money in the state coffers gathers dust for the first nine months of any given fiscal year. The government spends some amount only in the eleventh hour of the fiscal year,” said Acharya.
“If the government wants to expand the economy to Rs 5 trillion then it should improve the system of expenditure by ensuring that the allocated budget is properly utilized with uninterrupted flow throughout the year,” he added.
He argued that the government’s inability to resolve the crisis of big projects considered as ‘game-changers’ is hindering the progress of the nation’s economy.
“Dozens of national pride projects which can impact the national economy are reeling under crisis,” said Acharya, adding, “This has not allowed the country’s economy from progressing. The government must review its progress and take appropriate steps.”