Nepal – Federation Challenges

Nepal has adopted a three-tier structure of federal government (federal, province, and local). All three levels have the constitutional power to enact laws, prepare budgets, and mobilize their own resources. However, the new constitution has assigned expenditure responsibilities and revenue sources to all three tiers of the government but most of the key revenue sources remain with the central government and expenditure responsibilities of the sub national (province and local) governments are relatively larger creating an imbalance. The variation in the areas, population sizes, economic bases and availability of natural resources also creates a challlenge.........................

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