The Ministry of Finance (MoI) said the new fiscal year’s budget will be finalized soon and that little money has been allocated for development projects.
According to the ministry, consultations are ongoing with different ministries about the ordinary and development budget. The ministry has yet to announce the total amounts for the ordinary and development budget.
“We will consult all the ministries, we will see what they need and then we will assess what we can do. Efforts are ongoing and the budget draft will be finalized by the end of this year (solar year),” MoI spokesman Ahmad Wali Haqmal said.
Previously, the fiscal year was aligned with other countries' fiscal year (beginning in January), but this year the Islamic Emirate changed the fiscal year and it will start in the beginning of the solar year (late March).
In the budget prepared for the last three months –after the end of the last fiscal year – nearly 54 billion afghani was budgeted and less than 5 billion afghani was allocated for the development budget.
Several analysts said an extreme reduction of the development budget will lead to an increase in unemployment and poverty, and government’s incomes will decrease.
“As much as the development budget decreases, the rate of poverty and unemployment will increase...” said Mir Shikeb, an economic analyst.
“If big development projects are not resumed or started, inflation and unemployment will increase and the private sector will get weakened,” Abdul Nasir Reshtya, a political analyst said.