Economic growth to plunge
The country could not meet the downward revised target of economic growth too due to devastating earthquake that hit the country hard on April 25.
The country could not even meet revised economic growth of five per cent in the current fiscal year due to the huge damages caused by the earthquake, said finance minister Dr Ram Sharan Mahat, here today.
The government had – during the mid-term review of Budget for the current fiscal year – revised economic growth downward to five per cent from the six per cent due to poor monsoon and floods that has damaged the crops. Agriculture contributes one-third to the economy, whereas service sector contributes more than half.
The economic growth that was expected to be hit by the poor agriculture output is going to further decelerate to below five per cent due to devastating earthquake, he said, adding that the historic monuments and world heritage sites have been damaged that would hit tourism too. "
The earthquake will also have adverse affects on the service sector, Mahat added. "Likewise, the earthquake will also hurt industry."
The government might even have to restructure the current budget to allocate necessary resources for the reconstruction of the damaged infrastructure. Though, Mahat ruled out the possibility of restructuring of budget, he also did not rule it out completely. "The government has been able to spend around half of the budget," he said, adding that it has remaining capital and recurrent budget to help expedite reconstruction, 'but it will not be enough.'
He was hopeful of the international aid agencies to come forward for reconstruction.