By Our Reporter
India has substantially decreased its aid to Nepal for the fiscal year 2020-21. In the budget presented last week proposed to reduce the aid to Nepal by 33 per cent from the aid of last year. India has allocated Rs 12.8 billion for the upcoming fiscal year .Earlier it was Rs 19.2 billion. The latest Indian move, according to financial analysts, Nepal falls into a least priority country and New Delhi has shifted its Nepal paradigm.
Likewise, India in its new budget has proposed to reduce tax rate, which would exert pressure on Nepal to do the same.
Finance Minister Nirmala Sita Raman tabled a budget of 379 billion US dollars with a provision that anyone earning IRS500,000 does not have to pay any income tax. Likewise, those earning 750,000 a year have to pay only 10 per cent tax. Earlier, they had to pay 20 per cent.
Similarly, those earning IRS 1 million a year will pay 15 per cent tax and those earning 1.2million will have to 20 per cent of their income in tax.
Economic Pundits said that the cur in tax would increase Indian investment in Nepal.