The next budget should focus on employment generation to check the massive migration, increasing productivity and import substitution by creating business-friendly environment, suggested the experts to the central bank during an interaction here at the Nepal Rastra Bank (NRB) today.
The budget for the next fiscal year 2013-14 should concentrate on business expansion linking market with the farmers, encourage youth towards agriculture, promote organic agriculture, organised land and farming system, incentivise production and exports, and reform tax rates, they suggested.
They also recommended formulation of Assets Management Company, coupled with interest rates reduction for productive sectors, expansion of financial access to rural areas, bridging gap between banks and financial institutions and deprived sector, and easing of liquidity measures for the monetary policy for the next fiscal year.
Nepal Rastra Bank, as an economic advisor to the government, will suggest the recommendations of experts for the next fiscal year's budget, said Nepal Rastra Bank governor Dr Yuba Raj Khatiwada, on the occasion.
Despite political transition, increasing labour shortage and trouble, unfavourable weather, and delayed budget, the economy is sailing smoothly, he said, hoping that the inflation might cool down due to decrease in prices in the bordering districts.
The central bank, apart from fiscal policy, also has sought suggestions for the monetary policy for the next fiscal year.
Since the insurance companies are going for mergers, they should be incentivised, suggested Insurance Board chairman Dr Fatta Bahadur KC.
The board has increased the paid up capital of life and non-life insurance companies forcing them to go for merger. "They should be encouraged with sweetener," he added.
Likewise, Securities Board of Nepal Chairman Baburam Shrestha recommended tax break for Mutual Funds to encourage investors.