The budget is the government’s yearly plan of income and spending. Nepal’s federal budget is presented on Jestha 15 every year, and Lok Sewa often asks about this date, the fiscal year, types of budget, kinds of expenditure and the funds named in the Constitution. This note explains all of these in simple terms.
1. Fiscal year and budget dates
| Item | Provision |
|---|---|
| Fiscal year | Shrawan 1 to the end of Asar (about mid-July to mid-July) |
| Federal budget | Presented by the Finance Minister to the Federal Parliament on Jestha 15 every year (Article 119) |
| Provincial budget | Presented in the Provincial Assembly on Asar 1 |
| Local level budget | Presented in the local assembly by Asar 10 |
| Economic Survey | Released by the Ministry of Finance a day before the federal budget |
| Red Book (Rato Kitab) | Detailed budget estimates by ministry and programme |
2. Types of budget
| Type | Meaning |
|---|---|
| Balanced budget | Expected income equals expenditure |
| Surplus budget | Income is more than expenditure |
| Deficit budget | Expenditure is more than income; the gap is met by loans |
| Zero-based budget | Every item is justified from zero each year, not based on last year |
| Performance budget | Links spending to measurable results |
| Gender-responsive budget | Classifies spending by its benefit to women; Nepal started it in 2063/64 BS |
Nepal usually presents a deficit budget, financed by internal and foreign loans and grants.
3. Expenditure and revenue
| Expenditure head | Meaning |
|---|---|
| Recurrent (chalu) expenditure | Day-to-day costs: salaries, allowances, office running, grants to provinces and local levels |
| Capital (punjigat) expenditure | Spending that creates assets: roads, bridges, hydropower, buildings |
| Financing (bittiya byabastha) | Loan repayment and share or loan investments |
- Tax revenue: VAT, income tax, customs duty, excise duty and others.
- Non-tax revenue: fees, fines, royalties, dividends from public enterprises.
- Foreign grants and internal and foreign loans cover the deficit.
- A long-standing problem is low capital spending and a rush of spending in the last month (Asar).
4. Funds and laws in the Constitution
| Article / law | Provision |
|---|---|
| Article 116 | Consolidated Fund (Sanchit Kosh): all government revenue and loans go into it |
| Article 117 | Expenditure charged on the Consolidated Fund (e.g. remuneration of the President, Vice-President, Chief Justice and judges, heads of constitutional bodies); not subject to vote |
| Article 118 | Estimates of revenue and expenditure (the budget) |
| Article 119 | Budget to be presented on Jestha 15 |
| Appropriation Act (Biniyojan Ain) | Authorises the government to spend money |
| Finance Act (Arthik Ain) | Authorises the government to collect taxes |
| Contingency Fund | For unexpected expenses, later approved by Parliament |
Government accounts are audited by the Auditor General, a constitutional body.
5. Budget calendar of Nepal
| Date | Event |
|---|---|
| Shrawan 1 | Fiscal year begins (mid-July) |
| Jestha 15 | Federal budget presented in the Federal Parliament (Article 119) |
| Ashadh 1 | Provincial budgets presented |
| Ashadh 10 | Local level budgets presented |
| Ashadh end | Fiscal year ends; unspent budget lapses (freezes) |
| Magh (mid-year) | Mid-term review of budget and monetary policy |
6. Common budget problems in Nepal
- Low capital spending: much of the development budget is spent in the last months (the Asar rush).
- Over-optimistic revenue targets that are not met.
- Rising recurrent spending on salaries, pensions and interest.
- Many small projects spread thinly instead of finishing key projects.
- Weak project readiness: land acquisition and design delays.
7. How this topic is asked in the exam
Objective questions ask the date of budget presentation, the start of the fiscal year, types of budget (zero-based, performance, programme) and constitutional articles on the Consolidated Fund. Subjective questions ask about the problems of budget implementation in Nepal. Mention capital spending, the Asar rush and solutions such as a project bank and multi-year contracts.
📌 Key points to remember
- Fiscal year: Shrawan 1 to end of Asar.
- Federal budget on Jestha 15 (Article 119); provincial on Asar 1; local by Asar 10.
- Economic Survey is released a day before the budget; Red Book gives details.
- Deficit budget: spending more than income, met by loans.
- Recurrent spending: salaries and running costs; capital spending: assets like roads.
- Appropriation Act authorises spending; Finance Act authorises taxes.
- Consolidated Fund under Article 116; charged expenditure under Article 117.
- Gender-responsive budgeting began in 2063/64 BS; Auditor General audits accounts.
Test yourself: Budget and Fiscal Year of Nepal
Practise Fiscal year and budget dates, Expenditure and revenue and Funds and laws in the Constitution with 50 questions. Each attempt picks 25 at random.