Monday, December 31, 2007
In the liberal market policy the central bank also could not restrict any financial institutions from operating unless they break the rule. So, it increased the authorised capital, for commercial banks to Rs 2 billion and for development banks to Rs 640 million and for finance companies to Rs 30 million.
But with increasing number of these institutions, the central bank has to increase its supervisory capacity also, which has become a major challenge for itself lately.
However, still only the 20 per cent has access to banking services, according to the NRB data. The banks have recently been penetrating the semi-urban areas. Some of them have even brought innovative banking and non-banking services and instruments to expand their market.
One of the major reasons of flooding the finance institutions is the flow of remittances that has increased by 21.4 per cent to Rs 9.36 billion in Q1 of 2007-08 compared to a growth of 29.9 per cent last year. Meanwhile some bankers are afraid of non-banking professionals' dominance in this field making the whole sector vulnerable.
The increase in number of financial institutions set fire in Nepali capital market this year as Nepse crossed the historic high of 1064-point mark in December. Last year, the Nepse was hovering around 500-point mark.
Securities Board of Nepal (SEBON) has approved more that Rs 2.48 billion worth rights and ordinary shares issue of 17 companies — about 95 per cent of which are finance institutions — within the first five months of this fiscal year till December, whereas it had approved Rs 2.75 billion worth issuance of 31 companies during the whole year in 2006-07.
Similarly, within this first five months, the market capitalisation has also increased to more than three trillion rupees from last year's Rs 1.8 trillion. The total market capitalisation has reached to 27.78 per cent of GDP.
Capital market is considered a barometer of national economy. But in Nepal's context, it does not reflect the real economic growth as it is largely dependent on financial institutions only. Lately the Insurance, Hydropower and Hotels group is also picking up by the involvement of real sector is still far.
However, this year Nepse has automated the capital market, started providing real time information and WAN services.
The absence of real sector, effective monitoring of SEBON, the regulatory body of the capital market and lack of transparency in the listed companies — that stands at 142 at present — inside trading and manipulation have also been suspected in the secondary market, which is not a good sign.
Meanwhile, by the end of December, the market has started corrections, which is not bad.
SEBON is bringing some more regulations to modernise capital market for its transparency and involvement of institutional investors like mutual fund and CDS that will help control market volatility which could make Nepali capital market the real barometer of national economy.
Sunday, December 30, 2007
The government expenditures had increased by 9.9 per cent in the corresponding period of the previous year.
On debt servicing, expenditure on principal repayments increased by 83.0 per cent to Rs 4.39 billion as compared to a rise of 35.2 per cent in the corresponding period of the previous year.
Out of the total payment, Rs 2 billion went for repaying domestic debt and Rs 2.39 billion for the external debt.
Of the total exports, export to India decreased by 7.8 per cent compared to a marginal growth of 0.2 per cent in the same period of 2006-07. Exports to other countries also posted a decline of three per cent in contrast to a rise of 3.9 per cent in the comparable period of the previous year.
The decline in the exports of vegetable ghee, toothpaste, textiles, chemicals and pulses to India and woolen carpet, pashmina, readymade garments, Nepali paper and paper products and tanned skin to other countries contributed to the decline in exports in the review period, states the first four-month's report of the central bank.
Total imports grew merely by one per cent compared to a growth of 10.8 per cent in the corresponding period last year. "While imports from India went up by 2.2 per cent in the review period compared to a growth of 10.4 per cent in the previous year, imports from other countries fell by 0.9 per cent in contrast to a rise by 11.5 per cent in the previous year," the report states.
A rise in the import of vehicles and spare parts, MS billet, hot rolled sheet in coil, cold rolled sheet in coil and pipe and pipe fittings, among others, from India and substantial increase in the import of gold followed by telecommunication equipment and parts, electrical goods, transport equipment and parts and other machinery and parts, among others, from other countries led to the slight rise in total imports in the first four months of 2007-08.
Similarly, the overall balance of payments (BoP) recorded a deficit of Rs 3.61 billion in the first four months of 2007-08. The BoP had registered a surplus of Rs 180.8 million in the corresponding period of the previous year.
The gross foreign exchange reserves declined by 1.2 per cent from the level of 2007 and stood at Rs 163.12 billion in mid-November 2007. According to the report, such reserves had declined by 0.4 per cent in the corresponding period of the preceding year. In terms of US dollar, gross foreign exchange reserves rose by 1.6 per cent to $2.59 billion in mid-November, 2007. In the same period of the previous year, such reserves had risen by 2.1 per cent.
On the basis of the import figures for the first four months of 2007-08, the current level of reserves is sufficient for financing merchandise imports of 10.4 months and merchandise and service imports of 8.1 months.
This announcement was made by Dubai Tea Trading Centre (DTTC), an initiative of Dubai Multi Commodities Centre (DMCC). More than 35 tea consuming and producing nations are expected to participate in the forum that will be held on February 19-20, 2008. Since its inception in early 2005, the DTTC has expanded its range and reach to process teas from 13 tea producing countries including India, Kenya, Sri Lanka and China.
"The global tea trade is today somewhat fragmented, and we believe that networking forums such as the Global Dubai Tea Forum will prove beneficial in fostering increased transactions among developed and emerging tea markets," said Sanjay Sethi, head of DTTC. DTTC also facilitates sales to buyers in the Gulf Cooperation Council (GCC) states, Iran, Iraq, Jordan and CIS countries, and has plans to expand its services to other markets.
India is among the largest tea exporters to the Gulf region and the largest tea producing country in the world.
Saturday, December 29, 2007
The directive, to be enforced from tomorrow, directs category A, B, and C financial institutions — commercial banks, development banks and finance companies respectively — to stop margin lending and renewal of loans against shares.
“The actual impact will be on the capital market but it will also hit those financial institutions whose portfolio of lending against shares is big,” said Radhesh Pant, managing director of the Bank of Kathmandu and president of the Nepal Bankers’ Association.
“The directive is aimed at stopping manipulation and insulating the stock market,” said National Planning Commission member Dr Posh Raj Pandey.
“If the market is not corrected, more stringent measures will be used.”
Chiranjivi Nepal, chairman of the Securities Board of Nepal, also agreed: “The directive is for market correction. The capital market is said to be fuelled by margin lending on shares that the banks provide subscribers against their shares.”
Since the financial institutions are more vulnerable due to margin lending, this directive could save them from a crisis and stabilise the capital market, Nepal said. “Nepse needs to be cut down to size. If the share market crashes after reaching a sky high, not only will the investors find themselves on the streets but it will also hit the financial institutions and the national economy ,” he said.
“The directive may bring some correction,” said stockbroker Rabindra Pradhan. The capital market, dominated by financial institutions, has recently posted a whopping growth and margin lending is attributed to Nepse’s 'abnormal rise'.
But some challenge this directive. “NRB cannot issue any such directive as it is against the Company Act,” said capital market analyst Rabindra Bhattarai. “Banks can lend on collateral, be it shares or anything.”
NRB’s Legal Department Director Dharmaraj Sapkota dismissed Bhattarai’s argument.“The Nepal Rastra Bank Act-2058, clause 79, gives the central bank special power to issue such directives in order to manage the monetary market," he said.
Saturday, December 22, 2007
Singapore's strong showing this year underscored a more general recovery in the region since the 1997 Asian financial crisis, said The Global Property Guide. "Singapore is attracting and admitting more foreign-born workers, which is positive for prices," said the online report.
Residential property prices in the city-state surged by 24.3 per cent after adjustments for inflation to emerge as the world's hottest this year, Global Property said, followed by Shanghai, up by 20 per cent.
Robust economic growth accounted for the performances, the report stated. In Asia, it recommended Singapore, Thailand, Cambodia, Japan, Australia and New Zealand to investors.
Global Property cautioned against investing in Europe, with the exception of a handful of Eastern European states, because of high valuations after a long period of price appreciation.
The report found Egypt attractive for its high rental yields and low taxes but warned of a possible oversupply in Dubai, United Arab Emirates.
Every single investor, due to less investment opportunities, has found capital market more lucrative. But the apex regulatory body, Securities Board of Nepal (SEBON) and front-line regulator and secondary market, Nepse, time to time issue notices warning the investors to be more aware before putting their hard-earned money on any company.
The abnormal behaviour of the Nepse calls for more awareness among the investors and what could be a better idea than to publish a book on Nepali stock market and its nitty-gritty. Rabindra Bhattarai, a lecturer at the Shankerdev Campus and trainer of share market has come up with a book Nepalko Share Bazar (Nepal's share market).
The testimony of the book's popularity is that in a short span of time the author is forced to publish its updated third edition. Afterall, its a Bible to the investors.The author being a lecturer of finance has explained — in 19 chapters — Nepali capital market's modus operandi like how share price increases and decreases, acts and laws related to capital market and relation between capital market and monetary policy, in a plain language. The book also has a glossary section, which is very useful to the students and investors alike.
Bhattarai, who has other books like Stock Market in Nepal (english version), Investments: Theory and Practice, Capital Structure Management and Fundamentals of Financial Management and Corporate Financial Management to his credit is bringing another book Share Markets: Some queries soon.Since the market is getting mature, Nepali investors need more of such books.
Book: Nepalko share Bazar (Nepal's share market)
Author: Rabindra Bhattarai
Publisher: Buddha Academic Enterprises Pvt Ltd
Pages: 116Price: Rs 125
Wednesday, December 19, 2007
More than 133 million of the world's poorest people — 60 per cent of them women — received micro loans in 2006 to start or expand micro businesses, according to a report, 'State of the Microcredit Summit Campaign Report 2007', which is prepared with data gathered from more than 3,316 institutions worldwide.
In total, the institutions reported the number of beneficiaries soared to more than 133 million clients, with 93 million individuals falling into the campaign's focus poorest clients, from 13 million nine years ago. The focus group of clients has been identified those people living below $1 a day.
In Nepal, the Rural Microfinance Development Centre Ltd (RMDC), an apex wholesale agency for microfinance, released the report. RMDC stated that it has disbursed $31.8 million to the women of the poor families through its 60 partner organisations or micro-finance institutions (MFI) during its eight years of operation.
Targeting to the poor including the poorest of the poor, lending at their doorsteps without physical collateral, bi-weekly repayment schedules are basic characteristics of the MFIs, said Shanker Man Shrestha, CEO at the RMDC, adding that one of the most admired beauties of micro-credit is its 100 per cent repayment rate and RMDC's partners have maintained over 99 per cent recovery rate.
Shrestha said that micro-credit has yet to reach some of the most deprived areas of mid-western and far-western regions of the country. RMDC has taken appropriate steps and strategies to cover most of the poor population left out from the institutional microfinance services in the next 10 years.
Sunday, December 16, 2007
Soaltee Hotels Ltd is giving 10 per cent cash dividend — that is subject to the approval from its annual general meeting (AGM) — to its share holders from the profit it has registered during the fiscal year 2006-07.
Soaltee Hotels Ltd that is holding its 33rd AGM on January 9, will be the second hotel to hold its AGM. Two months back, Oriental Hotels (Radisson Hotel) held its 10th AGM.
The encouraging tourists inflow — in the past year due to peace accord between the government and Maoists — has helped the hotel industry to grow, lately.
However, Yak & Yeti Ltd has applied for delisting of its shares from the Nepse that had earlier freezed its share transactions after the former failed to pay its renewal fee for this fiscal year. "Yak & Yeti has requested us to be delisted," said Rewat Bahadur Karki, general manager of the Nepse.
Yak & Yeti Ltd's special AGM on December 14 has also decided to delist its shares from the Nepse. It is holding its regular AGM within this month.
According to the rule, the listed companies must pay their renewal fee within the first three months of the fiscal year. Hotel Yak & Yeti was the only hotel among the listed four hotels that has not paid its renewal fee.
Oriental Hotels has in its 10th AGM announced Rs 36,47,959 profit for the fiscal year 2006-07 from Rs 2,78,80,557 loss in 2005-06. It has earned Rs 15,17,00,000 from room charge only.
Oriental Hotels also become the third company — after Unilever and Nabil Bank — to hold its AGM this year. It held its 10th AGM on October 11. Oriental hotels has 28,000 share holders. The shares of Oriental Hotels Ltd (Radisson Hotel) has been hovering around Rs 122 per unit.
"Investment on assest-based industry like hotel has a bright and secure future," Bidhya Krishna Shrestha, managing director of Radisson Hotel, Kathmandu said, adding that Radisson has become the highest foreign currency earner among 5-star hotels for this year. "We also got ICAN best accounts runner-up awards," he added.
The hotel group, especially Soaltee and Oriental Hotels Ltd, has set an example at a time when the real sector has no contribution in the current bullish capital market.
"There is no transparency and good governance in the real sector," Shrestha said, explaining the reason behind real sectors absence from the Nepse.How comfortable is Hotel Group
1. Yak & Yeti Ltd — listed shares 2209208 units — paid up value Rs 100 per share — total paid up capital Rs 220920800*
2. Soaltee Hotel - listed shares 8697187 units — paid up value Rs 10 per share — total paid up capital Rs 86971870
3. Taragaon Regency Hotel Ltd — listed shares 7449875 units — paid up value Rs 100 per share — total paid up capital Rs 744987500
4. Oriental Hotel Ltd — listed shares 5000000 units — paid up value Rs 100 per share — total paid up capital Rs 500000000
Total listed shares of Hotel group 23356270 units — total paid up capital Rs 1552880170
Saturday, December 15, 2007
A five-member delegation led by Abdul Rahaman Mohammed Al-Khulaisi, joint secretary at the Qatari Labour Ministry today held discussions with the senior officials at Ministry of Labour and Transport Management (MoLTM) today. The meeting agreed to implement the bilateral labour pact after signing of the addendum protocol for which a Nepali official delegation has been invited to Doha.
"The protocol has no major changes or additions to the existing one but it will come into implementation once it is signed," said Keshar Bahadur Baniya, director general at the department of Labour and Employment Promotion. A high level Nepali team will go to Doha to ink the protocol following the approval of the ministerial council here, he added.
The meeting finalised the contents of the protocol, which specifies the responsible authorities of both the countries to oversee labour related issues and implement it as per the spirit of the accord.
A joint committee including representatives from both the countries will be formed to review employment opportunities in the recipient country. The review meet will be held twice a year alternately in Nepal and Qatar.
Nepali workers will be provided the remuneration and facilities according to the labour law of the host country. The protocol will remain an integral part of the labour pact and be effective as long as the pact exists.
Qatar has recently emerged as the most popular destination among Nepalis and has already employed over 1,50,000 Nepali workers.
During the first four months of current fiscal year, a total of 26,732 Nepali workers left for Qatar. This Gulf country has recently overtaken Malaysia as the most popular destination for Nepali jobseekers among the Gulf countries.
Nepal and Qatar had signed the bilateral labour pact on March 21, 2005 in Doha.
Friday, December 14, 2007
Nepali coffee is soon going to have its own logo to represent the Himalayan organic flavour in the global market.
The National Tea and Coffee Development Board (NTCDB) — a government agency for development and promotion of tea and coffee farming and marketing — has already prepared a logo for the Nepali coffee.
The logo, which depicts beans and steaming coffee with mountain in background and 'Himalayan Specialty' written on top and 'Nepal Coffee' on bottom, will come into practice following the approval of a board meeting of NTCDB scheduled for next week.
"The national logo will help the product for branding and creating its niche market," says Binaya Kumar Mishra, executive director at the NTCDB, adding that the demand of Nepali organic coffee in the international market has gone up significantly in the last couple of years.
According to him, the board is also planning to issue directives for the implementation of the National Coffee Policy-2060. It will spell out a numerous issues related to coffee farming, plucking of coffee beans, processing, production, quality control and packaging. All these should be at par with the international standards and guidelines issued by the International Coffee Organisation (ICO), adds Mishra, while talking to this daily.
The directive also has highlighted a need for creating database of coffee related institution, cooperatives, setting up mechanism for product development, market promotion and branding and providing training farmers, supporting on human resource development activities and consultation.
It also envisions Coffee Development Fund to provide technical and financial help to the concerned stakeholders. The fund will be jointly administered by the government and private sector.
Although Nepal has seven decade long history of coffee plantation, the commercial farming began only 25 years ago. Today coffee is commercial grown in 23 districts that covers 1400 hectares of land.
The mountain slopes of Nepal's mid-hill region with an altitude ranging from 800m to 1600m is climatically suited for coffee plantation. Arabic species of coffee is grown in Nepal, mostly in western hilly districts of Gulmi, Arghakhanchi and Palpa.
With growing popularity of the Nepali organic coffee in domestic as well as international markets, the production is also steadily growing. According to NTCDB figures, the production of dry cherry jumped to 115 metric tonnes (MT) in 2005 from 85 MT in 2003. It is expected to cross 272 MT this year.
The demand for Nepali coffee is ever growing, as 65 per cent of the total production of coffee is already being exported to the international markets like Japan, EU, Korea and USA. Considering the future potential, the board has already launched a pilot programme to promote commercial coffee farming in hilly districts of western Nepal.The coffee exports, in volume, began from 2002 and Nepal exported coffee worth Rs 40.11 million during the fiscal year 2006-07.
Thursday, December 13, 2007
"SEBON's board meeting today has decided to revoke the firm's licence," Chiranjivi Nepal, chairman of SEBON, said, adding that an investor Krishna Prasad Adhikari had filed complaint against the firm some three years back.
Ohm Securities and Allied Services — registered in the name of Mohan Sharma Lamsal, Reshma Sharma and Rajesh Sharma Poudel — had bought shares of Beema Sansthan in the name of Krishna Prasad Adhikari without his information. "The name of the client's father, grandfather and his signature are different in different forms," informed P N Poudyal, director at the Market Regulation Department of SEBON. "The broker had been buying shares in the fake clients' names also," he added.
"SEBON will not spare any foul play," Nepal said, adding that it will take action and penalise the culprits. Initially, there were 32 brokers at the Nepse but now only 21 are left. "Broker number 23 was under suspension from some time back," Poudyal said, adding that yet another broker is also under suspension.
SEBON has recently got regulations to act against malpractise of brokers, investors and market makers. Similarly, it is bringing Initial Public Offering (IPO) amended regulation, Merchant Banking regulation and Mutual Fund regulation to make the Nepali capital market more transparent, managed and investor friendly.
SEBON has also started market surveillance via Real Time Surveillance System and onsite inspection.
Bull run continues, trading halted
KATHMANDU: Nepse has today after registering a double digit rise in its index and posting 1025.91 points, halted trading almost half an hour before the regular trading hour. Normally, the trading hour starts at 12 noon and continues till 2 PM but today the secondary market closed half an hour before. Shares of Standard Chartered Bank were traded today at Rs 5260 after almost three weeks break. The market leader Development banks group's index has registered a rise of 100. 33 to 1919.45 points.
Monday, December 10, 2007
Nepal, meanwhile, was the region's poorest by both measures. The report by regional statistical agencies, coordinated by the Asian Development Bank (ADB), showed wide disparities in Asia's living standards.
It found that the tiny, oil-rich sultanate of Brunei has a per capita gross domestic product (GDP) 13 times higher than the regional average of $2,621 and more than 40 times larger than the lowest-ranked Nepal.
Brunei is followed by Singapore, Macau, Hong Kong and Taiwan. Apart from Nepal, the poorest have-nots include Bangladesh, Cambodia, Laos and India.
The study covered 23 economies, excluding Japan, South Korea and East Timor. India, one of the world's fastest growing economies, has a per capita income of $1,551, still behind the regional average and also below Sri Lanka and Pakistan. China, meanwhile, ranked above average with its per capita income of $2,986.
Meanwhile, Hong Kong residents were the biggest spenders, according to a measure of household living standards called the per capita actual final consumption expenditure index. Taiwan and Brunei came in second and third.
In terms of spending, China and India both lagged behind the regional average, the study found. "The study shows the growth and developmental challenges facing the region," said Ifzal Ali, ADB's chief economist.
"The region has miles to go before celebrating its economic success." The study, called '2005 International Comparison Program in Asia and the Pacific: Purchasing Power Parity and Real Expenditure,' is part of a global initiative spearheaded by the World Bank that allows cross-country comparison of purchasing powers of currencies and living standards.
Sunday, December 9, 2007
“Rights and bonus shares have fuelled the capital market,” capital market analyst Rabindra Bhattarai said. “The boom will sustain for some time.”
“However, small corrections here and there are evident any time due to the book closures of the financial institutions like Standard Chartered Bank that had pulled the market down a couple of weeks ago,” he added.
“Around 90 per cent of the shares traded on Nepse floor is of financial institutions,” CEO and managing director of Nepal Investment Bank, Prithvi Bahadur Pande, said, adding that it does not justify the market fundamentals. “If the banks have tremendous growth, it could be rational,” he added. “But the profit-to-earning (PE) ratio is abnormal and there has to be a correction sometime and the small investors could lose.The PE ratio should not be more than 20.”Now the PE ratio of most of the banks is over 40.
The Nepse floor is dominated by the development banks. The major market boosters in today’s trading were also the Development banks group that surged by 56.24 points or 3.72 per cent to 1566.12 points, Hydropower companies group flared by 25.36 points or 1.73 per cent to 1494.79 points and Finance companies group that flared by 9.66 points or 1.11 per cent to 881.16 points.
“People have also started holding the shares — that are in high demand but low supply in recent days — leading to a market boom,” Bhattarai said.
“Some investors are exploiting the market and controlling the price, so that they can borrow money from the banks against the shares,” Pande cautioned.
Chiranjivi Nepal, chairman of Securities Board of Nepal (SEBON), also suspected the sustainability of the current bullish trend. “Bearish trend is evident,” he said, warning the investors not to be affected by noise creators as they could spoil the market.
“Globally the trend is faster,” he said, adding, “But the shares of companies that have negative net worth and unbelievable PE ratio are also flaring, which could be fatal for the small investors.”
“The investors should go through performance of any institutions, before buying their shares,” he suggested.“The instruments are weak to check the market manipulation. So, only a limited number of people are enjoying the benefits,” Nepal accepted.
Why it’s a bit fishy
• Last December, Nepse index was hovering around the 500-point mark and the commercial banks group’s index was hovering around 590 points. Within a year i shot up to 500 ore points, whereas it took more than a decade to reach 500 points.
• Initially there were 32 brokers, but their number is now only 23 and soon Nepse is adding 27 brokers.
• Globally a standard PE ratio of a bank is not more than 20, but in Nepal, almost all the banks have a PE ratio over 40.
• Nepse started automated trading from September and now nine brokers transact from their office via Wide Area Network and soon Nepse will launch online trading.
Saturday, December 8, 2007
The World Bank (WB) has sanctioned its biggest ever support package to Nepal with $253 million in grants. The support package is designed to improve access to basic and primary education, build irrigation facilities, expand rural roads, improve livelihoods and empower the rural poor.
The new support package doubles the amount of development resources currently available from the bank, states a press release.
Earlier, briefing executive directors of the World Bank Group and their advisers, Praful Patel, WB vice-president for South Asia, said the grant programme intends to help Nepal implement its development programmes that enjoy the backing of the seven-party coalition in its efforts to bring about sustainable peace and build a new Nepal. “We all know that peace is needed for development. But in Nepal we have experienced that development is also needed for peace,” he said, adding that addressing root causes of the conflict will be key to ensuring lasting peace.
“Inequality and social exclusion are among Nepal’s foremost development challenges,” Susan Goldmark, WB country director for Nepal, said, adding that the package approved demonstrates the WB’s commitment to ensure social and economic inclusion of the poor, marginalised and less developed regions.
“Through improved schools, roads, water provision, and income-generating activities, we hope these projects will help the country step up the delivery of basic services,” she added. Out of the total amount, $100 million is for the Poverty Alleviation Fund Project II (PAF II), a community-driven development programme that has reached over nine lakh rural Nepalis over the last three years. The PAF II will cover all 75 districts and be accessible to some one million rural households.
A sum of $60 million is for the Education for All Project and $50 million for the Irrigation and Water Resources Management Project.The sum of $42.60 million is for the Road Sector Development Project.
Tuesday, December 4, 2007
Tom Wright, general manager of Cathay Pacific — with which Dragonair has merged last September — for India, Middle East, Africa & Pakistan, thinks it is the right time to resume Nepal flight. "There couldnot be any better time than this," he said, adding that the situation in Nepal is improving and tourism business is booming.
He stands correct as the very first flight was 100 per cent full with 150 economy passenger plus eight business class.
Last September Dragonair merged with Cathey Pacific. But it still operates its own brand. "Dragonair brand is an established brand," said, Rick Symington, manager — Bangladesh and Nepal, "so it kept its brand even after merger."
With its four flights a week between Hong Kong and Kathmandu — on Sundays, Mondays, Wednesdays and Fridays — Dragonair expects 50 per cent Hong Kong-bound and 50 per cent other countries passenger. "We are eyeing a major market share on Hong Kong-Kathmandu route with 50 per cent Nepali and rest international passengers," Wright said.
As a member of the Cathay Pacific Group, Dragonair flies to niche markets in Asia in addition to its core Mainland China market. The airlines operates a fleet of 31 passenger aircraft and six freighters serving 31 destinations including 21 cities in Mainland China."
As a subsidiary of the Cathay Pacific Group, Dragonair provides seamless connectivity for its passengers to more than 100 cities across the globe," he added."Supported by Cathay Pacific's international network, passengers flying with Dragonair will have better connectivity to major international destinations," Symington supported him."
This will be able to draw international tourists — specially Chinese tourists — to Nepal through its Hong Kong hub," Wright said, adding that Nepali passengers flying by Dragonair and further by Cathay Pacific via Hong Kong to some destinations in the UK, Europe, Schenzen countries, the US, Canada, Japan, Korea, Australia and New Zealand would not require transit visa.
Dragonair, jointly with the Cathay Pacific, operates a fleet of 152 aircraft and flies to 126 destinations. "Nepalis will have better option to fly to the US and Europe," Symington said, adding that Australia-bound and US-bound passengers will benefit more."
Dragonair is also thinking of freight operations in future, as it is the sixth largest freight carrier apart from being the sixth largest profitable airlines in Asia and the tenth largest profitable in the world," said Wright.
Recently, freight forwarders have urged the government to make the air cargo terminal 24-hour operational to boost trade. "For smooth freight operations, TIA air cargo terminal should be operational 24-hour," he said.
All the international airlines that have once pulled out of Nepal are resuming their flights at present forcing the only international airport TIA for upgradation to accomodate all the international airlines. "If it upgrades its facilities, TIA can lure more international flights and freight operators that would not only boost Nepal's export trade but also increase tourist arrivals," Wright said.
Dragonair — which has Amrawati Tours and Travels as its GSA for Nepal — first started serving on Kathmandu-Hong Kong route in 1989.
Saturday, December 1, 2007
In the first quarter of this fiscal year, total government spending has increased significantly by 53.7 per cent to Rs 30.03 billion, states a macro-economic report of Nepal Rastra Bank (NRB). It had increased by only 17.7 per cent in the corresponding period last year. The upsurge in total expenditure is blamed at substantial increase in government expenditure, including principal repayment.
"In the first three months, recurrent expenditure rose by 35.6 per cent to Rs 21.32 billion in comparison to an increase of 28.5 per cent in the same period last year," stated the report.
The central bank's report blamed the high growth of recurrent expenditure on increased expenditure on relief-related activities, salary-hike, a rise in peace related expenditure and additional expenditure relating to the preparation for the election of constituent assembly.
According to the central bank, the government budget also showed a deficit of Rs 9.40 billion as against the surplus of Rs 352.9 million in the corresponding period last year. A whopping rise in government expenditure and significant deceleration in the growth of non-debt resources have resulted in a budget deficit, claimed the report.
Similarly, revenue mobilisation has grown by 18.8 per cent to Rs 19.26 billion in comparison to a higher growth of 26.7 per cent in the corresponding period of the previous year. "The low growth of revenue is due to frequent bandhs and strikes in Tarai, problems in revenue collection in bordering customs and closure of some customs offices as well. The low collection of VAT and income tax has also pulled revenue growth down."
Exports have also declined by 0.6 per cent in comparison to a decrease of 0.3 per cent in the same period last year. "Of the total exports, export to India decreased by 0.2 per cent," according to the report. Exports to other countries also declined by 1.2 per cent in contrast to a rise of 7.1 per cent in the same period last year.
Imports have increased by 8.1 per cent in comparison to a slightly higher increase of 9.9 per cent in the corresponding period of last year. "While imports from India went up by 7.2 per cent compared to a growth of 13.1 per cent in the same period last year," stated the report. However, imports from other countries rose by 9.5 per cent compared to a growth of just 4.9 per cent last year.
The report stated that overall BoP recorded a deficit of Rs 5.88 billion. In the corresponding period last year, it has recorded a surplus of Rs 1.13 billion.
The gross foreign exchange reserves stood at Rs 158.08 billion in mid-October 2007, a decline by 4.3 per cent from Rs 165.11 billion in mid-July 2007.
In terms of US dollar, gross foreign exchange reserves declined by 1.8 per cent to $2.50 billion in mid-October 2007. In the same period last year, it had gone up by 1.9 per cent. However, the current level of reserves is sufficient for financing merchandise imports of 9.6 months and merchandise and service imports of 7.5 months.
Indian currency equivalent to Rs 20.58 billion was purchased through the sale of $320 million in the review period compared to a purchase of Rs 13.32 billion by selling $180 million in the same period last year. "The rise in the purchase of IC was due to widening trade deficit with India in the review period," stated the report.