Nepal’s Government Expenditure Reaches Rs 163 Billion in Two Months of FY 2025/26 – NRB Report

Nepal’s government expenditure reached Rs 163.47 billion in the first two months of the current fiscal year 2025/26, reflecting a moderate pace of fiscal spending, according to the Nepal Rastra Bank (NRB)’s latest report on Government Budgetary Operations. This marks an increase from Rs 128.08 billion during the same period of FY 2024/25, showing gradual expansion in both recurrent and capital outlays as the fiscal year progresses.

The report shows that total government resources stood at Rs 139.51 billion during the same period, resulting in a budgetary deficit of Rs 23.96 billion. Revenue mobilization remained strong, with total revenue collections (including federal, provincial, and local transfers) reaching Rs 157.53 billion, compared to Rs 166.38 billion in the previous year’s corresponding period. Out of this, federal government revenue accounted for Rs 135.88 billion, while foreign grantstotaled Rs 2.46 billion.

On the financing side, internal loans amounted to Rs 70.09 billion, primarily mobilized through development bonds (Rs 70 billion), while foreign loans contributed Rs 10.05 billion. This brings total financing resources available to the government to approximately Rs 80.15 billion.

At the provincial level, provincial government resources reached Rs 25.15 billion, against an expenditure of Rs 4.12 billion, generating a surplus of Rs 21.03 billion. Similarly, the balance of local governments improved by Rs 36.49 billion, reflecting strong resource inflows and moderate spending patterns.

As a result, the general government’s current balance stood at Rs 124.87 billion, while the total cash balance in the treasury reached Rs 255.61 billion by mid-September 2025. This figure includes deposits from local governments totaling Rs 116.55 billion, which signifies a comfortable liquidity position for public finances heading into the third month of the fiscal year.

Economists note that while fiscal performance has improved slightly, capital expenditure remains sluggish—mirroring a recurring pattern in Nepal’s public finance management. They suggest faster project execution and timely budget release to sustain economic momentum in the coming quarters.