breast feeding is best but not too many babies or mothers take to it, even then some babies need milk formula supplemented. As for cloth nappies, it is cheaper to use cloth nappies but unless your willing to clean crap of them every four hours(and trust me babies crap a lot, apart from eating and crapping theres not much else they do for the first 4-6 months)your partner might not be too immpressed with this job, between constant feeding, crying and sleepless nights the last thing you need is a huge bucket of crap to clean. I tried the cloth nappies for a day and turfed them out replacing thme with disposables.
Costs of clothes and babies stuff is pretty much the same as in western countries. Comparing things to prices in Australia its pretty much the same. However you can pick up some good brand clothes and babies accessories when they are on sale here.
last piece of advice get as much sleep as you can before the arrival of your baby, as you may not be able to have a peaceful sleep for quite sometime.