30 Years Ago
To contain budget deficit within desirable limits deficit within desirable limits has been a major goal of every budget speech of the nation for the past decades. But despite such perennial professions, the size of the deficit appears to have been yawing. The increasing trend of the deficit has picked up since the last year 1980\81 along with the national referendum. Previously government revenues used to exceed the among of deficit.
As the government started overextending itself by spending too freely; savings and investments have not been equal. Since fiscal 1974/75, the national saving rate has been trailing at around 10 percent of the gross domestic product (GDP) whereas national investment, which used to be roughly 14 percent of the GDP towards 1974\75, has now shot up 20 percent. During that period, His Majesty’s Government’s capital formation was around 22 percent which has now swelled to as high as 50 percent.
People’s Review, 14 April 1994.
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