The government has proposed a total budget of Nu 64.82bn for the financial year 2019-20.
Finance Minister Namgay Tshering revealed this while presenting the national budget for financial year 2019-20 to the National Assembly yesterday.
The Finance Minister mentioned that the main objective of the budget is to ensure economic growth and stability and achieve the objectives of the 12th Five Year Plan.
Of the total budget, Nu 34.6 bn is for current expenditure, Nu 26.5bn is for capital expenditure, Nu 0.32bn for lending and Nu 3.3bn for loan repayment. The total expenditure is estimated at Nu 61.19bn, which is 31% increase from the previous year.
“The economy is projected to grow at 7.2% during the fiscal year, mainly contributed by the commissioning of the Mangdechhu Hydropower Project Authority (MHPA) and the implementation of programs under the 12th FYP,” said Finance Minister Namgay Tshering.
He stated that the total resource estimated is Nu 54.6bn and MHPA is expected to boost the domestic revenue by 20%.
The budget report for fiscal year 2019-20 also states that domestic revenue is estimated at Nu 43.2bn while grants is estimated at Nu 11.3bn, which is expected to cover 43% of the capital expenditure. The fiscal deficit was reported at 3.04% of the Gross Domestic Product.
The Finance Minister said that the government had introduced new initiatives in education and health sectors by removing cut off points for the class X and introducing scholarships for class X students, introduced day feeding program in 115 rural schools and started implementation of the flagship programs. The government has also made major reforms to strengthen the public finance management by introducing new systems. It is also looking to broaden the tax base.
According to the budget report, Nu 4.53bn is allocated for revision of pay, allowances and benefits of public servants for the financial year as expenditure. Similarly, Nu 223.58mn is allocated for day feeding in 115 rural schools and Nu 247.065mn for scholarship for class X passed students for the financial year.
Among the 10 ministries, the Ministry of Agriculture and Forests has been allocated the highest budget to the tune of Nu 3.245bn closely followed by the Ministry of Works and Human settlements at Nu 3.207bn.
In terms of Dzongkhag wise allocation, the highest budget of Nu 427mn has been allocated to Samtse Dzongkhag and the lowest to Bumthang at Nu 185mn.
The Finance Minister said that from the financial year, the budget for the gewogs has been allocated as annual grants and the dzongkhag development has been enhanced. “These initiative are expected to provide flexibility in the use of the budget besides promoting ownership and accountability,” said the Finance Minister.
Lyonpo added the government has issued guidelines to ensure proper utilization of the grants.
The Finance Minister also mentioned that to finance the fiscal deficit, the government will resort to external and domestic borrowings. In addition, the government will also borrow for on-lending to SOEs to carry out socially beneficial projects and other priority programs.
The Economic and Finance Committee will review the Budget Report and submit its review to the House after 10 working days. The budget report will be deliberated on June 5.
Dechen Dolkar from Thimphu