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Implications of GoN's FY 2021 Budget, Policies. and Programmes on Skilling and Employment Initiatives

The Federal Government’s NPR 1647.6 billion budget this coming Nepali Fiscal Year places significant focus on controlling the Covid-19 pandemic, deploying customised tools to revive the economy, and job creation: a combined 1.36 million jobs are expected to be created this year. NPR 6.54 billion is budgeted across various ministries for skill development and awareness, of which 66.75% (NPR 4.36 billion) is intended to come through foreign assistance. Among several programmed initiatives, the Ministry of Industry, Commerce and Supplies has set aside one billion rupees to work with the private sector to create 25,000 jobs through apprenticeship-based training. Further, digital transformation has been accorded due priority, including to adopt an industry 4.0 revolution approach. And, as part of the ‘Made in Nepal’ and ‘Make in Nepal’ campaigns, to be spearheaded by CNI and other similar entities, the government will work with the private sector and deploy necessary policies including apprenticeship support, and tax relief to industrialize the country on a larger scale.

Province 2 Government’s NPR 33.79 billion proposed budget for FY 2021/22 lays substantial focus on saving lives by mobilizing resources for prevention, control and treatment of Covid-19. In addition, agriculture, education, job creation and tourism have been given special priority in the upcoming budget to support economic and job recovery from Covid-19. The budget also accords priority to building capable and technology-friendly human resources, for long-term development of the province, through partnerships with the private and cooperative sectors. More than NPR 640 million has been allocated for ‘Skill Development and Employment’ related initiatives. These include creating employment opportunities as part of a proposed restructured Micro-Enterprise Development Programme, youth-focused Covid-recovery self-employment programme, and through skill development of women and youth from the Dalit community. The province also plans to establish a Skills and Vocational Training Council.

Lumbini Province’s NPR 40.95 billion budget for the upcoming fiscal year allocates 51.71% for capital expenditure, 36.47% for recurrent expenditure, and 11.82% for fiscal transfer to local governments. Health, agriculture, skill development and employment generation are the top three priorities. An amount of NPR 463 million is allocated for skill development and awareness training. The proposed budget highlights the need to attract youths in skilling programs; improve training curriculum, training delivery methodology, and trainers’ capacity; and mandatory skills testing. Major skilling and employment initiatives include: i) the formulation of an ‘Integrated Labour and Employment Mechanism’ by the Provincial Planning Commission for job recovery from Covid-19, ii) implementation of a ‘Youth Self-Employment Programme’ to address Covid-19 impacts; and upgrading skills of youth in partnership with technical education institutes. Funding has also been set aside for three-month based skills and employment creation apprenticeship type initiatives with the private sector. As a trusted skilling and employment creation partner to relevant federal entities; as well as the Lumbini Province and Province 2, UKaid सीप is gearing itself to provide support for some of the above-mentioned proposed initiatives.