Six provinces oresent budgets with mixed priorities

Karnali delays amid political discord

 

Kathmandu, June 15

Six out of seven provincial governments tabled their budgets for the upcoming fiscal year 2025/26, with total outlays ranging from Rs. 31.97 billion (Gandaki) to Rs. 67.47 billion (Bagmati). Despite varying fiscal sizes and priorities, all provinces emphasised capital expenditure over recurrent spending and aligned their policies toward infrastructure development, employment generation, and sustainable growth.

Madhes allocated the highest proportion (64 per cent) to capital expenditure with an aim to boost agro-industrial development and youth entrepreneurship, while Koshi's nearly balanced split between recurrent and capital budgets is said to have growth approach. Sudurpaschim and Lumbini prioritised agriculture and tourism alongside physical infrastructure, whereas Gandaki stressed foreign investment, regional competitiveness, and private sector engagement. Likewise, Bagmati's focus are scattered across tourism, sports, agriculture and health.

Most of the provinces rely heavily on federal revenue-sharing, conditional and equalisation grants, and unspent balances from the current fiscal year. Internal revenue mobilisation remains modest across all provinces, with some provinces like Koshi and Gandaki planning to bridge gaps through internal borrowing.

In contrast, Karnali failed to present its budget due to a political impasse, as the opposition CPN-Maoist Centre boycotted proceedings over disputes concerning project transparency.

 

 

Koshi: Rs. 35.88 billion

The Koshi Provincial government has unveiled a budget of Rs. 35.88 billion for the upcoming fiscal year 2025/26.

Minister for Economic Affairs and Planning of Koshi Province Ram Bahadur Magar presented the budget of the province at the meeting of the Provincial Assembly Sunday.

Of the total budget allocation, Rs. 18.67 billion (52 per cent) has been allocated under the heading of recurrent expenditure, Rs. 17.10 billion (47.7 per cent) under the heading of capital expenditure and Rs. 100 million (0.3 per cent) under financial management.

Of the total allocation, Rs. 4.7 billion is allocated for financial transfers to the local levels.

The annual budget of the province for the next fiscal year has been increased by Rs. 600 million (1.7 per cent) as compared to the initial budget of the current fiscal year.  

This estimate is 1.7 per cent higher than the current fiscal year's allocation and 12 per cent higher than the revised estimate, said Minister Magar while presenting the budget.

The provincial government has allocated Rs 4.777 billion for financial transfers to the local level.

The Koshi government had unveiled a budget of Rs. 35.25 billion for the current fiscal year.

Of the estimated sources of expenditure for the coming fiscal year, around Rs. 32.74 billion will be managed from revenue collection and financial transfer.

The province has set a target to mobilise Rs. 5.50 billion from the internal revenue of the province, Rs. 12.39 billion from revenue sharing, Rs. 8.98 billion for fiscal equalisation received from federal government, Rs. 4.57 billion for conditional grant, Rs. 391 million for supplementary grant, Rs. 557 million for special grant and Rs. 356 million for the royalties, he said.

Of the remaining shortfall, Rs. 3.13 billion will be spent from the remaining cash balance.

The government has allocated Rs. 10.57 billion for infrastructure development, Rs. 4.73 billion for drinking water, irrigation and energy, Rs. 2.18 billion for agriculture and industry, Rs. 2.97 billion for tourism, forest and environment, Rs. 2.97 billion for education, science and social services, Rs. 3.51 billion for health and Rs. 960 million for peace and security.

Magar said that the budget has been prepared with the aim of maintaining high economic growth of the province by improving education, health, infrastructure development and increasing agricultural production and reducing migration.

Gandaki: Rs. 31.97 billion

The Gandaki provincial government has presented a budget of Rs. 31.97 billion for the next fiscal year 2025/26. 

Minister for Economic Affairs of Gandaki Province Dr. Tak Raj Gurung presented the budget at the meeting of the Provincial Assembly.

The provincial government has allocated around Rs. 12.63 billion (39.5 per cent) under the heading of recurrent expenditure, Rs. 19.09 billion (59.7 per cent) under capital expenditure and Rs. 250 million (0.8 per cent) under financial management.

Minister Gurung said that Gandaki Province would receive Rs. 7.73 billion from the federal government as fiscal equalisation and Rs. 9.79 billion from revenue sharing.

While presenting the budget, he estimated that the province would receive Rs. 498 million from royalty, Rs. 3.35 billion from conditional grants, Rs. 639 million from supplementary grants and Rs. 498 million from special grants. 

He estimated that the internal revenue of the province will be Rs. 5.45 billion.

There will be a cash balance of Rs. 2.24 billion from the implementation of the budget for the current fiscal year, he said. 

The Gandaki provincial government has planned to fill the deficit of Rs. 1.75 billion from internal borrowing.

The size of the provincial budget has been reduced by Rs. 1 billion for the next fiscal year as compared to the budget presented for the current fiscal year. The government had presented a budget of Rs. 32.97 billion for the current fiscal year 2024/25.

The objectives of the budget are to increase employment and income through sustainable economic growth, develop quality and modern infrastructure, and create skilled and productive human capital in modern technology.

Minister Gurung has said that the Invest Gandaki programme will be implemented as an intervention programme to build a strong regional economy.

The budget stresses on job creation and poverty alleviation by attracting foreign investment in agriculture, tourism, energy, and forestry and mining industries.

Lumbini: Rs. 38.91 billion

The Lumbini Provincial government has presented a budget of Rs. 38.91 billion for the upcoming fiscal year 2025/26.

Minister for Economic Affair and Planning of Lumbini Province Dhanendra Karki has presented the annual income and expenditure estimates of the province for the next fiscal year at the meeting of Provincial Assembly Sunday.

Minister Karki allocated a budget of Rs. 12.01 billion (30.88 per cent) for the recurrent expenditure, Rs. 23.47 billion (60.32 per cent) for capital expenditure and Rs. 3.42 billion (8.80 per cent) for fiscal transfer to local levels for the next fiscal year.

The province has set a target to mobilise Rs. 7.78 billion from the internal revenue of the province, Rs. 11.86 billion from revenue sharing received from the federal government and Rs. 415 million from royalties to be received from the federal government.

Similarly, the provincial government has estimated to generate revenues of Rs. 2.829 billion from local levels.

This size of the budget for the fiscal year 2025/26 has been slightly increased as compared to the budget of the current fiscal year 2024/25.

The provincial government had presented a budget of Rs. 38.97 billion for the current fiscal year.

The Lumbini provincial government has resolved to achieve the long-term aspiration of a prosperous Lumbini, happy citizens.

For this, the budget has prioritised increasing production and productivity in agriculture, access to quality education and health services, entrepreneurship development, sustainable infrastructure development, inclusive development with social justice, and the creation of productive employment, thereby contributing to the reduction of economic inequality and poverty.

The budget and programmes have been focused on poverty reduction and economic stability to achieve high and sustainable economic growth.

The provincial government has allocated a budget to advance the process of forming the Lumbini Development Authority to find its own existence in Lumbini, the birthplace of Buddha.

Finance Minister Karki said that the budget has been allocated for the Lumbini International Buddhist Summit with the slogan "Take a step towards Lumbini".

A budget of Rs. 4.72 billion has been allocated for productivity and sustainable development of agriculture. The goal of the budget is to modernise and commercialise agriculture and increase its productivity.

 

Madhes: Rs. 46.98 billion

The government of Madhes Province has announced the budget of Rs. 46.98 billion for the upcoming fiscal year 2025/26. 

Minister for Finance of Madhes Province Sunil Kumar Yadav presented the budget of the province at the meeting of the Provincial Assembly.

The government has allocated Rs. 16.72 billion for recurrent expenditure and Rs. 30.26 billion for capital expenditure. 

The share of recurrent and capital expenditure in the budget estimate is 35.89 per cent and 64.11 per cent respectively.  

The size of the budget of the Madhes Province for the next fiscal year has increased by 6.17 per cent as compared to the current fiscal year.

The budget size of the province for the current fiscal year was Rs. 43.89 billion.

The province has set a target to mobilise Rs. 9.50 billion resources from the internal revenue of the province, Rs. 12.73 billion from revenue sharing, Rs. 12.35 billion from revenue distribution received from the federal government, including Rs. 7.72 billion from fiscal equalisation and Rs. 4.26 billion from conditional grants, Rs. 394 million from special grant and Rs. 358 million from supplementary grant.

Of the remaining shortfall, Rs. 10.38 billion will be spent from the remaining cash balance of the current fiscal year and Rs. 2 billion will be raised from internal borrowing.

Minister Yadav said that the budget will focus on maximum utilisation of available resources to reduce dependence on the federal government by investing in agriculture, tourism and agro-based industries, agricultural modernization, production and productivity growth, youth entrepreneurship, innovation and employment generation, and making the economy of Madhes Province self-reliant, prosperous and strong.

The budget for the upcoming fiscal year is directed to minimise negative impacts of climate change by minimising exploitation of natural resources and making sustainable and equitable use of available natural resources in the process of development and construction.

The budget is oriented towards creating an investment-friendly environment and encouraging the private sector to carry out development and construction works through public-private partnerships, thereby creating employment opportunities in the province itself, he said.

The necessary budget has been allocated for the promotion of the major tourist destinations of the entire Madhes Province, as well as Janakpurdham, at the international level, including India, with the main theme of "Visit Madhes".

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 Provincial Budget Table (Amount in Rs. Billion):

Province	Budget (Rs.)	Recurrent Expenditure (Rs.)	Capital Expenditure (Rs.)	Transfers to Local Level (Rs.)
Koshi	35.88	18.67 (52.0%)	17.10 (47.7%)	4.77
Madhes	46.98	16.72 (35.9%)	30.26 (64.1%)	-
Bagmati	67.47	26.04 (38.1%)	41.43 (61.0%)	-
Gandaki	31.97	12.63 (39.5%)	19.09 (59.7%)	-
Lumbini	38.91	12.01 (30.9%)	23.47 (60.3%)	3.42 (8.8%)
Sudurpaschim	33.47	10.21 (30.5%)	19.83 (59.3%)	3.43 (10.2%)

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Sudurpaschim: Rs. 33.47 billion

Minister for Economic Affairs of the Sudurpaschim Provincial Government Bahadur Singh Thapa unveiled a budget of Rs 33.47 billion for the FY 2025/26 at the provincial assembly on Sunday.

Out of the total budget, Rs. 10.21 billion (30.49 per cent) is allocated for recurrent expenditure, while Rs. 19.83 billion (59.25 per cent) has been set aside for capital expenditure. Likewise, Rs. 3.43 billion (10.24 per cent) is allocated for inter-governmental fiscal transfers, and Rs. 10 million for financial management.

Minister Thapa informed that Rs. 1.65 billion is expected to be generated through internal revenue mobilisation next year. Furthermore, the province anticipates receiving Rs. 9.87 billion from revenue-sharing, Rs. 80 million from royalty-sharing, and Rs. 8.93 billion as financial equalisation grants - all from the federal government.

The province also expects to utilise Rs. 7.66 billion in unspent funds from the current fiscal year, Rs. 4.16 billion through conditional grants, Rs. 602.6 million in supplementary grants and and Rs. 516 million in special grants from the federal government.

The Ministry of Physical Infrastructure Development received the highest allocation of Rs. 15.40 billion. Minister Thapa also announced budget provisions for the Chief Minister's Housing Programme.

Rs. 704 million is earmarked for programmes to promote the cultivation and commercialisation of legumes, oilseeds, spring rice, and livestock farming. The province aims to develop itself as a seed and seedling hub, with corresponding budgetary allocations made.

Likewise, Rs. 3.30 billion has been allocated to the Ministry of Land Management, Agriculture, and Cooperatives. The government has also earmarked funds for the development of Bankabir as a tourist destination, and for the conservation of Tharu Maruwa culture and the endangered dolphin species.

Minister Thapa has earmarked Rs. 2.34 billion for the Ministry of Industry, Tourism, Forests, and Environment. Likewise, Rs. 230 million has been allocated for establishing one model provincial school in each of the 32 constituencies.

Rs. 76.5 million has been set aside for MBBS scholarhips, while the Ministry of Social Development has received a total of Rs. 7.07 billion. The Ministry of Internal Affairs and Law has been allocated Rs. 360.4 million.

 

Bagmati: Rs. 67.47

Minister for Economic Affairs and Planning of the Batmati Province, Kundan Raj Kafle, announced a budget of Rs. 67.47 billion for FY 2025/26. This marks an increase of Rs. 3 billion compared to the current FY's budget of Rs. 64.54 billion.

For the upcoming year, Rs. 26.04 billion (38.06 per cent) is allocated for recurrent expenditure, while Rs. 41.43 billion (61.04 per cent) has been earmarked for capital expenditure. To meet the expenses, the provincial government has set a target to collect Rs. 28.87 billion through taxes and Rs. 6.79 billion from other sources.

Presenting the budget at the Bagmati provincial assembly, Minister Kafle said that Chitwan would be developed as a tourism hub and a film city will be established at Dangduge Hill in Dolakha. The minister prioritised agricultural production, introducing a 'One Ward, One Agriculture' programme.

The government will manage the market for agricultural produce and arrange agricultural ambulances. Efforts will be made to boost dairy production, organise the milk market, and upgrade the powdered milk factory.

The provincial hospital will be developed as a trauma centre. Free insurance will be provided for economically disadvantaged citizens. A budget of Rs. 350 million has been allocated to the Madan Bhandari Academy of Health Sciences.

Likewise, the ongoing programme at the provincial hospital, which serves as a guardian to orphaned children, will be continued. The Ministry of Social Development has been allocated a budget of Rs. 4.35 billion.

In the sports sector, Rs. 90 million has been allocated for the construction of a stadium in Godawari of Lalitpur district. Further allocations have been made for stadiums in Makawanpur and Dolakha, and for the construction of the Gautam Buddha Cricket Stadium in Bharatpur. Similarly, a multi-purpose sports ground will be built in each electoral constituency. The Ministry of Sports received an allocation of Rs. 1.16 billion.

The government will discourage the opening of new road tracks. Programmes such as the Janata Aawas and the replacement of thatched roofs will be continued. The Ministry of Physical Infrastructure has got a budget allocation of Rs. 24.80 billion.

Priority will be given to lift irrigation projects. The Narayani–Khageri irrigation system will be further improved. The Ministry of Drinking Water and Irrigation received Rs. 7.28 billion.

 

Karnali: Budget delayed

Meanwhile, in Karnali, main opposition CPN Maoist Centre caused delay in the budget presentation.

The CPN Maoist Centre said that it would not allow the government unless the party was apprised of projects included in project banks of the provincial government. The Karanli provincial government decided to include all major projects of the province in the project banks and allocate the budget accordingly.

But the main opposition accused the government of not informing them about the budget. Although efforts were underway to forge consensus, no agreement was reached by 10 pm on Sunday.

Constitutionally, province governments should unveil budget on Asar 1 (June 15).

(Prepared jointly with Laxman Kafle with inputs from Abinash Chaudhary in Dhangadhi, Shaligram Nepal in Chitwan, Phadindra Adhikari and Ramesh Poudel in Pokhara, Laxman Paudel in Bhairahawa and Dharbendra Kumar Jha in Janakpurdham)

 

Published in The Rising Nepal daily on 16 June 2025.