KATHMANDU: On the first day of the budget session, Monday (May 11), the government presented the policies and programs for the upcoming fiscal year 2026/27 in the Federal Parliament. President Ram Chandra Paudel presented the government’s policies and programs before both houses of the Federal Parliament.

The Rastriya Swatantra Party (RSP)-led government, which holds a nearly two-thirds majority, has prioritized the promotion of good governance, investment expansion, and increasing the use of information technology. The policies and programs have also prioritized constitutional amendment. It is mentioned that shared issues for constitutional amendment will be determined through dialogue with political parties. It states, “To ensure equal ownership of all classes, regions, and communities, a constitutional amendment discussion paper will be prepared by identifying shared subjects of constitutional amendment based on dialogue and cooperation with political parties.”

The government has clarified its economic policy through the policies and programs. The government has announced a ‘New Phase of Economic Reform Series,’ under which it has set an ambitious goal of reaching an average economic growth rate of 7 percent throughout the coming decade to upgrade Nepal into a dignified middle-income country. For three decades, the Nepali economy has been at an average economic growth of 4 percent.

The policies and programs mention that comprehensive legal and institutional reforms will be carried out to achieve economic growth. The government stated that the fundamental restructuring of economic incentives will be done to reduce production costs, simplify the business environment, remove policy and legal hurdles, and attract domestic, foreign, and migrant investment.

IT-based service exports, hydropower, tourism, high-level agriculture, and green industrialization have been made the major pillars of economic transformation.

If the government implements this policy, it will facilitate domestic and foreign investments that were obstructed in the past due to legal processes and hassles and will remove the sluggishness seen in development and construction. In the current situation, especially migrant Nepalis have had to face hassles in investing in Nepal due to various legal complexities. The areas for domestic, foreign, and migrant investment have also been specified in the policies and programs.

The government has declared the Information Technology (IT) sector a national strategic industry and mentioned in the policies and programs that the export of software, digital services, cloud services, cybersecurity, and Artificial Intelligence (AI) computation will be encouraged. It is also mentioned that financial concessions and investment facilitation will be provided to the information technology export industry. IT-based service exports, hydropower, tourism, high-level agriculture, and green industrialization have been made the major pillars of economic transformation.

AI generated image

Until now, vegetable oil, carpets, tea, coffee, spices, iron, and steel, among others, were kept in government statistics as goods exported from Nepal. However, in reality, Rs 125 billion has entered this year alone from information technology exports such as software development, outsourcing, AI services, data processing, and web/app developing from Nepal.

In these policies and programs, a plan has been brought to expand the ‘REDD+’ program by forming the Nepal Carbon Authority for carbon trading. About 46 percent of Nepal’s forest area is covered in carbon trading, and foreign currency is earned from this. With the current policies and programs, the forest area for carbon trading will be further expanded. It has been announced that direct benefits from carbon trading will be ensured for community forest groups.

However, no novelty is seen in other subjects of the policies and programs. It appears that the policies brought by previous governments have been continued. For education, health, and employment, the words are new and kept in English. Free education up to the secondary level is something already mentioned in the Constitution. It is said that proper regulation will be done to make educational institutions operated by the private sector service-oriented and quality-centered. This has given the message that quality education is possible only in private educational institutions.

The government has put forward the ‘Learn and Earn’ program by taking a policy to link students studying in higher education with employment. Under this, the use of phrases like ‘National Apprenticeship Program,’ ‘Remote Work,’ and ‘Skill Passport’ seems to target the foreign labor market. Subjects raised by old political parties in the past and made into election slogans have also been included in the new government’s policies and programs. Matters of fertilizer, seeds, irrigation, and markets for produce for farmers have also been raised.

The policies and programs seem to address especially the middle and upper classes. Nothing has been said in favor of Dalit, marginalized, and excluded communities.

While this government was being formed, it was accused of being anti-republican and anti-federalism. However, to shut down those allegations, it is mentioned in the policies and programs that the strengthening of the federal democratic republican governance system will be the government’s guidance.

The government has raised some popular subjects that are against the spirit of the Constitution of Nepal. For example, people previously affiliated with the ideology of any party will not be allowed to hold government jobs; if a person is found to be close to any ideology, they will have to lose their profession.

The policies and programs seem to address especially the middle and upper classes. Nothing has been said in favor of Dalit, marginalized, and excluded communities.

To return the savings of cooperative victims, it is said that the government will establish a credit information authority. However, the government has not brought a program to apply balm to the economic pain of usury or loan shark victims. There is an abstract program regarding squatters. Instead, a controversial land bank policy has been brought.

Despite this, there is some novelty in this compared to the policies and programs brought by previous governments. Now, it remains to be seen how the budget is brought to implement this. If the budget can be allocated in a way that implements the policies and programs, some improvement and change might be seen in the country.