Kathmandu, June 10 – Mahesh Acharya, Joint Secretary at the Ministry of Finance, has said that Nepal’s economy will gradually improve as the government’s budget enters the implementation phase.

Speaking during the first session of the Fourth National Banking Discourse 2026, titled “How Long Will Money Continue to Pile Up in Banks? How Can Business Confidence Be Revived?”, Acharya said the government’s policy direction and priorities have been clearly outlined through the budget.

“The government’s approach and vision are evident in the budget. Economic policies have been discussed up to the level of the Prime Minister,” he said.

Acharya expressed a different perspective on concerns over excess liquidity in the banking system. He noted that Nepal’s fixed exchange rate regime with India and the continuous rise in foreign exchange reserves have contributed to higher liquidity in the market.

“There is excess liquidity in the market, which is not necessarily a bad thing,” he said. “Policy rates were lowered because high interest rates had discouraged investment. Interest rates in Nepal are among the lowest in South Asia, and credit expansion has increased compared to the previous year.”

According to Acharya, the budget has introduced several initiatives aimed at supporting economic recovery. He said the government has positioned itself as a “big push” coordinator for major projects and has designed the budget accordingly.

“Capital expenditure is not limited to funds allocated under the capital heading alone,” he said. “Financial transfers also contribute to capital formation, and current expenditure should not be viewed as unproductive spending. Such expenditures also help stimulate economic activity.”

Acharya added that the government’s programs place particular emphasis on good governance and information technology, which he said are central to its broader economic agenda.

He expressed confidence that the economy would gradually strengthen as budgetary measures are implemented and public spending gains momentum.