KATHMANDU: Capital expenditure remained at a dismal 12.12% over the first six months of the current fiscal year.

According to the Financial Comptroller General Office (FCGO), only Rs 49.42 billion out of the Rs 407.88 billion allocated for capital expenditure could be spent during the review period.

Analysts say the slow pace of capital spending highlights persistent problems related to project readiness, procurement delays, and implementation bottlenecks. This has raised concerns about the government’s ability to accelerate infrastructure spending.

Capital expenditure stood at 16.16% during the same period of the previous fiscal year. The government had mobilised Rs 56.94 billion out of the allocated Rs 352.35 billion in the first half of 2024/25.

Progress in recurrent expenditure stood at 41.25%. Out of Rs 1,180.98 billion allocated for recurrent spending, Rs 503.55 billion had been spent by the sixth month of fiscal year 2025/26.

Likewise, the government made 40.95% progress in financial management expenditure. Out of Rs 375.24 billion allocated for servicing domestic and international debt, Rs 153.64 billion had been spent by mid-January of the current fiscal year.

With this, the overall expenditure progress reached 35.14% by mid-July. The government has managed to spend Rs 690.21 billion out of the total allocation of Rs 1,964.11 billion.

Meanwhile, the government mobilized 39.01% of the Rs 1,480 billion revenue target in the first six months. Total revenue collection during the period stood at Rs 577.39 billion.

According to the FCGO, progress in tax and non-tax revenue collection stood at 38.93% and 39.69%, respectively. Tax revenue collection reached Rs 516.11 billion out of the targeted Rs 1,325.58 billion. Non-tax revenue collection stood at Rs 61.28 billion out of the targeted Rs 154.41 billion.

Progress in foreign grant mobilization remained weak at 13.3% during the review period. The government has targeted Rs 53.44 billion in foreign grants for the current fiscal year, but has mobilised only Rs 7.10 billion so far.

Financing expenditure, which includes loan repayments, stood at Rs 153.65 billion, accounting for 40.95% of the annual target, indicating a relatively heavy repayment burden during the period.