A seminar on “Public Debt and Fiscal Sustainability in Nepal” was successfully organized today in Nepal Administrative Staff College, Jawalakhel, Lalitpur, with first technical session on “Public Debt, Legal and Institutional Perspective.” The seminar was organized by KYE Group-IV as part of the Know Your Economy module of ACMD-IVwith the objective of the public debt is to enable the government to raise funds in a lawful, transparent, and accountable manner while maintaining fiscal discipline, financial stability, and compliance with constitutional and statutory frameworks.
The program brought together senior officials from NASC, guest expert and twenty-five participants from ACMD-IV. Discussions centered on the current level and composition of Nepal’s public debt, recent trends in domestic and external borrowing, and Ensuring legal compliance and accountability.
The Chief Guest of the program was Executive Director of NASC Mr. Ram Sharan Pudasaini. Other guests included Dr. Raghu Bista, Mr. Yagya Prasad Dhungel, Course Coordinator Mr. Gobinda Bhandari. Mr. Ram saran kharel was invited as the guest expert from Nepal Rastra Bank. The group constituted of Mr. Madhav Mishra, Mr. Bhoj Kumar Basnet, Ms. Bishnu Maya Banjade. Mr. Rupesh Gami, Mr Ram Bdr Basnet, and Mr. Kumar Baral. The program was chaired by Mr. Bhoj Kumar Basnet and Mr. Madhav Mishra, Mr. Ram Bdr Khadka, Mr. Kumar Baral presented the seminar paper.
In the thematic session on public debt, legal, and institutional matters, Mr. Madhav Mishra highlighted the necessity of public debt, the modern state system, and the concept of public debt from classical and neo-classical perspectives.Mr. Kumar Baral emphasized that public debt in Nepal is regulated by the Constitution and the Public Finance Act. He noted that parliamentary approval is mandatory for government borrowing, and both central, provincial, and local governments are constitutionally authorized to take loans. He also explained the legal procedures involved in raising public debt.Mr. Ram Bdr Khadka stressed the issues and challenges of public debt and highlighted the policy implications for debt sustainability.
During the interactive question-and-answer session, participants raised key issues such as rising external debt risks, exchange rate risks, debt servicing pressures, and the relationship between imports and exports. The invited experts and participants shared their perspectives on the presentations and policy discussions. Feedback particularly emphasized the need to focus on debt instruments, institutional and absorptive capacities, legal reforms, provisions of the PDMO (Public Debt Management Office), making expenditures effective, sustainable debt analysis, and selecting areas for the productive use of debt, all of which help improve debt transparency.
Mr. Ramsaran Kharel highlighted that public debt does not become a burden when it is invested in revenue-generating activities or productive infrastructure that contributes to long-term economic growth, thereby strengthening the government’s capacity to repay. He also noted that such investment improves Nepal’s economic activities, increases foreign currency reserves, and helps restore stability in Nepal’s economy.
The session was concluded by Mr. Ram Sharan Pudasaini, who presented a summary of the session, appreciated the efforts of the participants, and also clarified some legal aspects related to public debt.