KATHMANDU, April 26: The government has set an ambitious goal of surpassing the country's gross domestic product (GDP) to over Rs 10 trillion within the next five years.

The National Planning Commission (NPC), which has prepared the draft of the 16th five-year plan, announced on Thursday the target of reaching the GDP consumer price of Rs 10.5 trillion in the fiscal year 2085/86 BS.

In the draft of the 16th plan presented by the NPC in the presence of Prime Minister Pushpa Kamal Dahal at the meeting of the National Development Council held on Thursday, it is mentioned that the target has been doubled compared to the year 2022/23.

In the year 2022/23, the country's GDP is Rs 5.132 trillion. By the end of the 16th Plan, the GDP size has been set to increase to Rs 5.381 trillion, although achieving this target remains uncertain.

GDP reflects the overall economy of the country, encompassing private and public consumption, government spending, investment, inventories, construction spending, import-export activities, and income. The NPC has crafted the 16th five-year plan to outline the country's development objectives from the fiscal year 2024/25 to 2085/86 BS, charting a regional trajectory for Nepal's growth.

By the end of the 16th plan, the government has set the goal of increasing the country's economic growth to an average of 7.1 percent. Min Bahadur Shrestha, vice-chairman of NPC said. He claims that a symbolic plan has been formulated to show the overall direction and pace of national development. "We have made a plan with the goal of strengthening economic bases and accelerating economic growth," Shrestha said, "There are many challenges in development efforts," he added.

The NPC plans to strengthen the major sectors of the economy, increase production and productivity and encourage job creation, protect and develop the manufacturing industry, and improve the structure of the competitive system.

Similarly, the NPC said that it plans to focus on the areas of fee management and prudent use of public debt, giving maximum returns to public resources, and encouraging private sector investment.

There is a government plan to promote industrial and tourism promotion and development, access to new sources of foreign aid and use of new tools, promotion of import management and export policies and programs, external investment in productive sectors and modern technology. Strengthening of exchange system, management of remittance flow, control of illegal transactions, formalization of informal activities are also mentioned in the 16th plan.

The NPC has also made a plan to increase the easy access of the public to the financial market, encourage credit mobilization in productive and sustainable development-friendly areas, restructure and reform public institutions, transfer finance based on predictable and cost needs and capabilities regulate and strengthen the cooperative sector.

Over the next five years, the government envisions raising the per capita income of Nepalis to $2,381, compared to $1,399 in the fiscal year 2022/23.

Prime Minister Pushpa Kamal Dahal said that the government's goal is to ensure a prosperous and content Nepali populace. "To reach a prosperous Nepal, good governance and social justice are essential conditions," he said. Prime Minister Dahal said that the need of the country is to achieve social justice and prosperity through good governance by focusing all efforts on increasing production and creating jobs. "Our need is to focus all efforts on increasing production and employment generation," said Prime Minister Dahal.

He also held the view that agriculture should be given top priority. "Agro-based industries that increase agricultural production and create agricultural employment should be established," he said. Even though the government has taken an ambitious target of increasing the country's GDP size, economic growth rate, and per capita income, there are still many challenges to fulfill.

Resource management and implementation of the Sustainable Development Goals is challenging. Due to weak competition in the market, large share of informal transactions and leakages, abnormal fluctuations in liquidity, price and supply, exchange rate system and external influence on inflation are high.

The structural problems of the economy, shrinking of the productive industry sector, the declining contribution of the secondary sector, the expansion of the tertiary sector without a solid foundation of the primary and secondary sectors are challenges in achieving the target.

Likewise, there is a suspicion that the size of the economy will increase relatively due to low production and productivity, increasing production costs and weak competitiveness, increasing aversion to agriculture and dependence on basic food items. Additionally, the influx of consumption-oriented imports, coupled with a limited export capacity and a burgeoning trade deficit, presents significant challenges for the government.

Youth population is migrating for foreign employment due to a scarcity of domestic job opportunities, fragmented social security programs, mounting liabilities, inadequate management, and a perception of low security.

 
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