The eighth Five-Year Plan ignores the devastating effect of the Indo-Nepal impasse on the economy. Is it possible to plan for the next five years pretending that the economy has been unaffected? Until the impasse ends, it is doubtful whether planning for more than a year at a time is meaningful, especially with regard to the fulfillment of basic needs. A divorce from planning and budgeting is a natural phenomenon in which unprecedented pressures can exist on price levels, revenue mobilisation, wage and salary levels, balance of payments, and the exchange rate, etc. The way the economy has been mismanaged, it would not be unreasonable to expect the GDP to slide for two to three years before it looks up again.
As an economic document, the planning dimensions lack hard-core analysis. There is no debate on the feasible growth rate of GDP and its consequences on savings, gaps in investment ratio and balance of payments, revenue, GDP ratio, ICRS, labour, capital and land productivities, etc. As a political document, it does not tell us how politics will itself be fortified to face the challenges. In particular, how will the bureaucratic and political absorptive capacities used to implement plans will still be made effective, efficient and honest? How will the government's deteriorating finances be arrested by measures other than the rhetoric of privatisation?
As a strategic document, the planning dimensions defeat its own purpose with its populist approach, which consists of ambitious objectives, spreading resources thinly everywhere, ex-tolling state handouts for the poor, ignoring the need to give definite priorities to strategic and tactical goals, objectives, and means, ignoring issues of internal consistencies in planning and the need for trade-off and resolution of conflicts, providing for a cacophony of policies under the meaningless banners of "national," "regional," and "sectoral" policies.
As a macro-planning document, it fails to rise above the various sectoral plans and their programme budgets. It may have swallowed the data provided by the government: for example, that agricultural production has increased by 4 to 6 percent when there is no sign of the green revolution. Lastly, the inequities arising from HMG's refusal to reform its tax policies and systems, including the impact of deficit financing on the absolute poor, needs careful evaluation . A fiscal regime based on tax holidays and luxury imports, supported by recourse to monetarism, can hardly lead to self-reliant growth with equity, and is a doubtful strategy for development , as far as eradicating absolute poverty goes.