Intra-party Maoist feud to cost country dearly

The intra-party feud within UCPN-Maoist doesn’t bode well for the country.
The global anti-money laundering watchdog Financial Action Task Force (FATF) is set to downgrade Nepal to the ‘high risk zone’ or black list it, as the country has time and again failed to fulfill its promise to fight dirty money flow.
Though the government is planning to table Mutual Legal Assistance Bill and Extradition Bill tomorrow before the House, Mohan Baidhya faction of the ruling UCPN-Maoist is adamant on not letting the government pass the bills that is sure to hit Nepal’s international reputation and trade.
“If the bills are passed by February 17, when International Cooperation Review Group (ICRG) under the FATF decides Nepal’s fate, we could buy time till June 2013 to go with the reforms prescribed by the January face-to-face meeting in Sydney,” a source at the central bank said.
Central bank deputy governor Maha Prasad Adhikari left for Paris today to take part in the meeting that will dwell on member countries’ and territories’ progress on February 13-14 and decide on February 17 whether to upgrade or downgrade them.
On the one hand the government is observing Nepal Investment Year 2012-13, claiming to attract Rs 500 billion foreign direct investment (FDI), while on the other it has repeatedly failed to pass the important bills that are key to attract FDI and boost international trade.
Adverse action of FATF means the foreign investors will not be able to open their branches here, let alone start new companies, and those who have already invested may pull out. The donors will also include more stringent conditions for aid and grants that have a substantial share in Nepal’s development activities.
Government’s failure to pass the bills will first hit the financial sector.
“Some of the banks have already started feeling the heat,” the central bank source said, adding, “Though Nepal has been lobbying with all the Kathmandu-based envoys of the countries in ICRG to make them understand the transitional phase in country’s politics, the chances of Nepal either being downgraded or being black listed are high.”
Failure to pass the key bills, among the three (third being Bill Against Organised Crime), will also expose Nepal’s weak diplomacy, as the country repeatedly sought time extension but was unable to fulfill its commitment.
Meanwhile, President Dr Ram Baran Yadav, during a meeting with Prime Minister Dr Baburam Bhattarai today, showed concern about government’s failure to pass the bills.