NPC calls on local bodies to own SDGs

Calling on the government to make adequate funds available to local bodies so that various programmes could be rolled out to meet the UN-backed goals, National Planning Commission (NPC) has referred to newly-formed bodies as key players in implementation of the Sustainable Development Goals (SDGs).
The new constitution has given significant power to the local bodies, enabling them to not only frame and implement development programmes on their own but also to work as judiciary to make the people get justice at gtheir doorstep. As the local bodies can also frame guidelines and procedures on their own to govern themselves, they must align their plans, policies and programmes with the SDGs to meet the target, according to National Report on the Implementation of the 2030 Agenda for Sustainable Development.
The report prepared by the planning commission, also suggests that the resources need to be allocated properly, otherwise 'implementation of SDGs at local level will be difficult'.
Recommeding a strong partnership between three tiers of government – federal, provincial and local – is extremely necessary to integrate the SDGs into local level structures, the report states that consultation, workshops and trainings will be required to ensure that SDGs are incorporated in provincial and local plans. "It is also equally important to ensure effective participation of women, youth and other marginalised groups in planning and implementation of SDGs at local level.”
A follow-up on Millennium Development Goals (MDGs) that expired at the end of 2015, SDGs is a set of 17 goals and 169 targets covering a broad range of sustainable development issues to be met by 2030.
SDGs aim at promoting well-being of all the people, sustainable industrialisation, inclusive and sustainable economic growth, and employment and decent work for all, apart from the key goals to end poverty and hunger from the world, reducing inequality; making cities inclusive, safe and resilient; ensuring sustainable consumption and production patterns; and taking urgent actions to combat climate change and its impacts.
However, meeting the SDG targets require at least $1.5 trillion a year at the global level.
Likewise, Nepal is, according to the report, trying to manage financial resources from a triangular partnership including public and private sector as well as development partners.

Lawmakers concerned over last minute capital expenditure

The lawmakers suggested the government to implement a carrot and stick approach to effectively implement the budget and boost capital expenditure.
Speaking at a meeting of the Finance Committee under the Legislature Parliament today, they also said that the quality of development projects should not be compromised while expediting the spending.
Likewise, the inability of large infrastructure projects to utilise the funds allocated for their development has been cited as one of the major reasons behind the low level of capital expenditure in the last fiscal year.
"The capital expenditure used to outpace the recurrent expenditure until 1994 but that trend has reversed in recent years with capital expenditure remaining at the lower end," former finance minister and leader of CPN-UML Bharat Mohan Adhikari, on the occasion, said, suggesting to pursue reward and punishment approach.
He also proposed to hold regular review meetings with the big ministries that have the highest budgets. "The ministries, secretaries and project chiefs should take responsibility, if there is no progress in project implementation,” he said, adding that the quality of the development projects is also equally important as is the implementation of the budget.
"The practice of spending at the last month or at the last minute of the fiscal year continued in the last fiscal year also,” said a lawmaker Shakti Basnet. "The continuity of this practice raises concern whether the budget has been utilised in a proper way and has delivered results,” he said, adding that lack of proper management of workforce has also resulted into delay in project implementation.
Another lawmaker Dil Bahadur Sah, on the occasion, said that the government should take action against those responsible for the delay in the implementation of development projects. "The government should increase monitoring and oversight of development projects," he said, suggesting to take action on project chiefs, contractors or whoever is responsible in delaying projects till the last moment.
Likewise, lawmakers also said that the payment to the contractors should be made on time. "There are reports that huge amount of checks for payment have been made in the last week of the fiscal year," they said, adding that the payment of the previous quarter should be made by next quarter.
Saying that ‘a sense of accountability’ must be inculcated among the stakeholders responsible for project implementation, they also asked the government to build capacity to implement the budget. "The capacity of the bureaucracy must be developed to ramp up capital spending," they suggested.
Responding the lawmakers at the meeting,  joint secretary at the Finance Ministry Kewal Prasad Bhandari, said that the low capital expenditure is the result of lack of spending capacity. According to him, payment of checks worth Rs 43 billion was issued on the last day of the last fiscal year.
The government has earmarked large amounts of money for the implementation of large infrastructure projects without adequate preparations, according to the Financial Comptroller General’s Office, the government agency which oversees the government’s expenditure against the budget. As a result, these projects were unable to use the funds leading to poor capital spending in the fiscal year 2016-17.
The Finance Ministry had allocated substantial funds to projects like Kathmandu-Tarai Expressway, Budhi Gandaki Hydroelectric Project, Nijgadh International Airport, Babai Irrigation Project, Rani Jamara Kulariya Irrigation Project and different transmission line projects without planning how to execute them, Financial Comptroller General Rajendra Prasad Nepal informed the lawmakers.
In the last fiscal year, the government had allocated Rs 10 billion for the Kathmandu-Tarai Expressway. "But it has not yet moved an inch ahead,” said Nepal.
"Likewise, Rs 2 billion had been allocated for Nijgadh International Airport, but without a modality to implement the project, the budget went unspent," he said, adding that the Budhi Gandaki, Bheri-Babai Irrigation, Rani Jamara Kulariya Irrigation and different transmission line projects did not move ahead as land acquisition could not be completed To improve capital expenditure, the government must allocate a budget to projects only after proper homework," he added.
Capital expenditure during the last fiscal year which ended on July 15 stood at only 65 per cent of the total allocation. Out of the Rs312 billion allocated for capital spending, only Rs 202.7 billion was spent.
The manner of capital expenditure was also questioned as almost 36 per cent of the spending took place in the last three weeks of the fiscal year.

Foreign Minister pledges to promote economic diplomacy

Deputy Prime Minister and Foreign Minister Krishna Bahadur Mahara pledged to make the economic diplomacy more effective through the 'bilateral consultation mechanism' based in those countries that Nepal has established the diplomatic relations.
During the meeting with a delegation from Federation of Nepalese Chamber of Commerce and Industries (FNCCI) at his office today, Mahara said that Nepal would establish 'bilateral consultation mechanism' in those countries, where it had not yet setup such mechanism to promote economic diplomacy.
The government would deal with the economic issues with special priority, he told the private sector.
On the occasion, FNCCI president Bhawani Rana suggested the government to send a diplomatic mission head with certain terms of reference and pay a special heed to the export promotion. The delegation also demanded the inclusion of FNCCI representatives during the state's high-level foreign visits to encourage the private sector.

NEA proposes 20 per cent hike in electricity tariff

Nepal Electricity Authority (NEA) has proposed to hike the electricity tariff by 20 per cent for the industries. The government power utility has proposed to hike the tariff without affecting the tariff for household use, said a source at the NEA that has forwarded the proposal to increase the electricity tariff to the Electricity Tariff Fixation Commission (ETFC), which had increased the tariff by 20 per cent effective from mid-July last year.
The commission chair Jagat Bhushal admitted that the NEA has forwarded the proposal to hike the tariff. "We have received the NEA proposal," he said, adding that the commission has distributed the proposal to the members. "Now we hold discussions on the proposal and take a decision accordingly."
"We have proposed to hike the electricity tariff as it has been deemed necessary to keep the NEA in good financial health and ensure smooth supply of electricity, said the NEA spokesperson Prabal Adhikari.
According to NEA, if the commission approves the proposal, the tariff for industries will increase by 20 per cent, but tariff for household users won’t go up much.
The authority has also asked the commission to implement the provision to automatically hike the electricity tariff by 5 per cent every year.

Lords opening two new hotels in Nepal

The Lords Hotels and Resorts from India is opening two new hotels in Nepal.
Currently, the company is operating the four-star Mirage Lords Inn at Battisputali in Kathmandu. The company has recently said that it is opening four new hotels and two of them will be located in Nepal. However, the exact locations have not been revealed yet.
Meanwhile, the Lords said that it has targeted to increase the occupancy of its hotels by 68 per cent this year. "The hotels had recorded the 64 per cent increase in occupancy in 2016."
Currently, there are 26 hotels operating under the company and wants to increase the number to 49 by 2020.
Most of the hotels of Lords Hotels and Resorts have been opened for pilgrims visiting Hindu shrines in India.

Nepal Army might buy DPR of expressway from Indian consortium

The Nepal Army – which has been authorised to construct the Kathmandu-Tarai expressway by the government – might buy the Detailed Project Report (DPR) from an Indian consortium to expedite the construction of the strategic road.
As the Indian consortium including Infrastructure Leasing and Financial Services (IL&FS) Transportation Networks, IL&FS Engineering and Construction and Suryavir Infrastructure Construction has already prepared the DPR of the 76-km roadway, the Army has thought of using it to save the time and money to redo the DPR.
The Technical Department of the Nepal Army has started the process of hiring consultants to determine, if the DPR prepared by the Indian consortium is suitable for adaptation. The team will go through the report and advise the division whether it could be used.
Though the Army has said that a formal decision is yet to be made, it has no option than to buy the DPR of the expressway with the Indian company to start the construction immediately after the monsoon.
But the Indian consortium has asked the government to pay Rs 600 million for the DPR as it could not get the contract to construct the expressway.
According to the contract between the Indian consortium and the government, the government should compensate the Indian consortium for the DPR, if government scraps the agreement. "If the Army adopts the DPR, it will pay the compensation," according to the Army source.
If the Army decides not to purchase the DPR, it will have to prepare a new one, which will take quite some time delaying construction of the express way that is expected to reduce travel time – between Kathmanu and Nijgad in the south to less than an hour – and petroleum consumption also.
 The DPR had proposed building a four-lane expressway of Asian Class-1 Standard. The expressway should be 23-metre wide in the hills and 25-metre wide in the plains, it explains, adding that the expressway will also have around 100 bridges, including 35 smaller ones, and two tunnels that are 11.3-metre wide and 5.5-metre tall.
Initially – in February 2015 – the government had assigned IL&FS-led consortium to build the expressway as it was shortlisted as the potential builder of the expressway.
The consortium had agreed not to charge the cost of the DPR, if it was allowed to construct the project. It had submitted the report to the Sushil Koirala-led government in June 2015.
But the Koirala-led government did not award the contract to the Indian consortium due to congroversy on annual minimum revenue guarantee of up to Rs 15 billion a year, if the  road traffic failed to generate adequate profit.
After increased controversy, the government scrapped all the agreements with the Indian firm.
Later a high level committee formed under National Planning Commission (NPC) vice chair Dr Min Bahadur Shrestha in February suggested the government construct the expressway using its own resources but could adopt the DPR prepared by the Indian company to save time and money.
However, the government, in May, decided to hand over the project to the Nepal Army despite wide criticisism also for not involving the private sector, and involving the Army in to the business. Earlier when the Army had opened the track of the expressway, it was accused of embezzling funds.

Nepal stands atop in South Asia in terms of women coming for health care delivery

Nepal has topped in the entire South Asia region in terms of the number of expectant mothers choosing delivery in health facilities.
According to health secretary Prof Kiran Regmi, around 60 per cent pregnant women have been recorded to have availed safe delivery and maternity services from birthing centres. "The percentage is the highest benchmark among other countries in the South Asian Region."
The maternal mortality rate in Nepal has fallen to 134 per 100,000 pregnant women and new mothers, while the child mortality rate stands at 21 per 1,000 live births.
The ministry is currently implementing an ambitious programme to reduce maternity mortality to 90 and infant mortality rate to nil.
Nepal took significant strides in the mother and child care campaign after the government accorded high priority to these programmes, making sure that many pregnant women benefited from modern delivery facilities and available maternity services.
Nepal – that has been a member of the Global White Ribbon Alliance for Safe Motherhood since 2009 – has been providing free services in reproductive health care, including uterine prolapse.
During a four-day global meeting on Safe Motherhood organised by Safe Motherhood Network Federation of Nepal that began here today, participants discussed on the initiatives taken by Nepal to reduce child and maternal mortality rates.
Representatives – from 16 countries including from South Asia – with Global White Ribbon Alliance for Safe Motherhood, an international organisation established for safe motherhood, will review the programmes related to safe motherhood run in their respective countries in the meeting.
Inaugurating the meeting, Prime Minister Sher Bahadur Deuba said that the constitution has guaranteed quality health services as a fundamental right. He expressed the belief that it would bring remarkable improvement in access of general people to healthcare services.
Programmes launched by the government have focused on achieving sustainable development goals related to health, he said adding that the health ministry had primarily paid attention to achieve the goals related to safe motherhood. "Rural women in Nepal still have less access to safe motherhood and this problem must be addressed collectively to control maternal deaths and child mortality in the country."
Secretary Regmi, on the occasion, said the ministry was focused on achieving sustainable development goals relating to safe motherhood.
Likewise, Safe Motherhood Network Federation president Arzu Rana Deuba said that Nepal of late witnessed a remarkable progress in the area of safe motherhood, the status of rural women however had not changed much. She also demanded that the government pass a bill relating to safe motherhood.
Safe Motherhood Network Federation vice-president Bishnu Raj Nepal said participating countries and WHO representatives in the meeting would share work experiences related to safe motherhood while preparing a future work strategy.
The SMNF was established in 1996. It has worked on planning and implementing awareness and advocacy programmes related to safe motherhood and proper care of newborn babies.

Nepal-India investment summit in October

Federation of Nepalese Chambers of Commerce and Industry (FNCCI) is planning to hold Nepal-India investment summit in October this year to attract Indian investment in Nepal.
Publishing the achievements of the first 100 days of the newly elected FNCCI executive committee today, FNCCI president Bhawani Rana said the summit will be held towards mid-October. The summit, which will be organised in Kathmandu, aims to attract Indian investment in Nepal.
She said that the the newly elected executive committee has started its tenure with four major agenda including administrative reform and institutional development of FNCCI, policy lobbying and intervention, economic diplomacy and international trade and capacity building of private sector and FNCCI members through innovative programmes.
"For the administrative reform, FNCCI has formed an expert committee," she said, adding that the committee has already submitted its report, now it will be implemented soon. The private sector umbrella organisation is also planning to adopt more technology-friendly measures. "We also have started the process to construct a separate building for commodity council," she added.
Rana also informed that FNCCI is focusing on consolidating trade exchanges and economic diplomacy with other countries. Informing that the elections of provincial chambers of commerce and industry have already been completed in six provinces, she said that the remaining one will also be completed soon.
She also informed that during the first 100 days, the new executive committee worked on issues related to employment, reconstruction, and women entrepreneurship; and signed an agreement with Industry Ministry for a five-year project on rural enterprises and remittance.
Addressing the press meet, senior vice-president of FNCCI, Shekhar Golchha said that FNCCI is preparing for the management of provincial chambers of commerce and industry.
Talking about the Goods and Services Tax (GST) recently introduced in India, he said that there is a lot of confusion about it not only in Nepal but even in India. He, however, claimed that the GST will promote fair trade and discourage illegal imports. GST was implemented in India on July 1 this year.
Likewise, FNCCI announced that it would be organising a cross border trade and tourism expo jointly with the government of West Bengal on August 28. It also said that it will establish Nepal-India investment promotion cell in order to strengthen trade and tourism of the country. FNCCI is also planning to launch ‘women in business’ programme, FNCCI president cup T20 cricket, among other initiatives. 

Department of Passport receives ISO certification

The Department of Passport under the Foreign Ministry has become the first government agency to be accredited with the ISO standards.
The International Organisation for Standarisation has accredited the department with the ISO 9001: 2015 certificate for being able to maintain international standards in the preparation, certification and distribution of passports.
Unveiling the ‘ISO 9001:2015’ certificate at a programme held at the department today, deputy prime minister and foreign minister Krishna Bahadur Mahara said that it was a matter of pride that the department was the first government agency to be honoured with the ISO certification.
Stating that the certification was a result of the dedication, efficiency and awareness of quality service of the department employees, Mahara directed the employees to work with a goal to maintain the achievement, and attain higher goals. "The government must work hard as it has to be prepared to issue e-passports,” he said.
Foreign Secretary Shanker Das Bairagi, on the occasion, said the accreditation was a result of increased transparency, professionalism and effectiveness, and expressed the hope that the feat would inspire other government agencies.
National Bureau of Standards and Metrology director general Biswababu Pudasaini lauded the department for the achievement, while calling for continued action to maintain it.

Nepal expects FDI equal to 20 per cent of GDP every year till 2030

Nepal expects Foreign Direct Investment (FDI) equal to 20 per cent of its gross domestic product (GDP) every year till 2030 to achieve the Sustainable Development Goals (SDGs). Saying that it is not possible to achieve the SDGs through domestic investment alone, the government has pinned its hopes on FDI.
Presenting a report at the United Nations Economic and Social Council (UN-ECOSOC), National Planning Commission (NPC) vice chair Dr Min Bahadur Shrestha said that Nepal hopes to attract FDI equal to around 20 per cent of its GDP every year till 2030.
He said that the government expects huge FDI mainly in infrastructure development projects as the government alone cannot finance mega projects.
According to the data, Nepal was able to attract FDI equal to only 0.3 per cent of its GDP in 2016. Though the figure was only 0.24 per cent in 2015, the government has been claiming to have attracted FDI equal to three per cent of the GDP. Over the past few years, less than 50 per cent of the FDI pledges made by foreign investors has been entering the country, also due to bureaucratic dilemma.
Experts claim that the importance of FDI has increased further as the country has adopted the federal system of governance.
Nepal needs to spend about 11 per cent of its GDP on infrastructure development to achieve the SDGs related to the infrastructure development sector by 2030. Nepal has attached top priority to infrastructure development, followed by the development of the social sector.
At present, Nepal has been investing only about five per cent of its GDP or about $1 billion in infrastructure development which is far from being sufficient.
According to a projection, the size of Nepal’s GDP will reach Rs 3,445 billion by 2030.  Based on the data, Nepal will have to attract FDI worth R 689 billion in 2030 in its journey to achieve the SDGs.
However, going by the current FDI trend, the government needs to really work very hard to achieve the SDGs. Nepal began to attract FDI after implementing the sixth Five-year Plan (1980-1985) with the aim to establish big and mineral-based industries in the country.

Yeti airlines introduces two ATR aircrafts

Yeti Airlines has introduced two ATR 72-500 turboprops.
The 72-seater aircraft – the most fuel efficient carrier – was brought at the cost of Rs 1 billion, according to the private airline operator. "Manufactured in France by ATR aircraft manufacturer and purchased from Nordic Aviation Capital based in Singapore, the airplanes landed at Tribhuvan International Airport (TIA) today through the routes of Singapore, Thailand and Chiang Mai, said the airlines manager Bhimraj Rai.
The newly purchased aircrafts is planning to fly on Kathmandu-Biratnagar, Kathmansu-Bhairahawa, Kathmandu-Nepalgunj and Kathmandu-Bhadrapur, he said, adding that the airlines now has seven aircrafts in total. "Now the airlines is operating 30-seater six aircrafts Jetstream 41, apart from plan to introduce additional two ATR aircrafts within this year.
The ATR 72-500 aircraft with call sign MSN 876 and Nepali registration number 9N-AMN is the youngest FAA/EASA approved pressurised aircraft in operation in the Nepali domestic sector, the airliner said, adding that the ATR 72-500 is powered by two Pratt & Whitney PW127 engines and equipped with Hamilton Sundstrand composite blade propellers. These high-tech engines and propellers ensure exceptional performance, fuel efficiency, remarkably low noise and low greenhouse gas emissions, according to the airline.
This ATR 72-500 aircraft has been lease financed from Nordic Aviation Capital (NAC), the industry’s leading regional aircraft lessor, serving over 70 airline customers in 47 countries. Its clients include leading airlines such as Aeromexico, Air Canada, British Airways, Air Berlin, Azul, Garuda, Flybe, HOP!, as well as major regional carriers like Air Nostrum, Jet Time, Etihad Regional, Binter and Air KBZ, among others.

Government yet to get Rs 42 billion reimbursement

The government has yet to receive Rs 42.65 billion as reimbursement from different development partners, according to the Financial Comptroller General Office (FCGO).
The government has already spent the amount on different projects in the fiscal year 2016-17, but the development partners have not yet paid back.
According to the FCGO, the government had received Rs 48 billion, which it spent on various projects in the previous fiscal years. Likewise, the government still has to receive Rs 510 million as reimbursement for projects that have already been completed.
According to Financial Comptroller General Rajendra Prasad Nepal, the reimbursement process has been delayed also due to the projects as they do not submit their complete reports to the line ministries and the Finance Ministry on time.
In a programme organised by FCGO here today, he said that the office is being restructured according to the provincial system under the new Constitution. "FCGO will install a system whereby the real time data of revenue can also be accessed by this fiscal year," he said, adding that earlier the office only managed the real time data of government expenditure, but by this fiscal year it will be possible to get data of revenue collection too.

MCC grant agreement expected to be signed by September

The Millennium Challenge Corporation (MCC) – an independent foreign aid agency of the US government working to reduce global poverty through economic development – has said that it is finalising the projects under its $500 million grant to Nepal. It expects that an agreement will be signed with Nepal for the five-year-long compact programme, by September this year.
In addition to the US grant, Nepal will contribute $130 million, making a total of $630 million, which will be invested into energy transmission and road transportation projects, according to senior officials of the MCC.
They said that they expect the US and Nepal governments to sign the agreement in September after finalising ‘some key next steps’ in the coming weeks that includes cabinet approval of the compact programme and then its voting by MCC’s board of directors and the US Congress for approval.
A visiting US MCC team led by regional deputy vice president for Europe, Asia, the Pacific and Latin America for the MCC Fatema Z Sumar today said that the MCC and the Nepal have agreed to invest in the Electricity Transmission Project (ETP) and the Road Maintenance Project (RMP). "MCC and the Nepal mutually agreed to focus on binding constraints for MCC compact investment, the inadequate supply of electricity and the high cost of transportation,” she said, adding that following the signing of the agreement, the MCC will finalise the preparatory works that is required in order for us to start the actual five-year compact.
The ETP project will include the component of construction of up to 300-km 400 Kv transmission lines that stretches from eastern to western Nepal, three hydropower substations and an additional cross-border transmission line, according to Sumar.
Similarly, the RMP projects will include components of road maintenance of cumulative 305-km and introducing smart and efficient technology to undertake robust road regime, she said. According to MCC, out of the $630 million of total funding, transportation project would be of around $55 million and the power sector of around $520 million while remaining funds will be spent on administrative activities.
Referring to works from the Nepal like finalising all issues related to land acquisition and regulatory reform including the passage of the bill on electricity regulatory commission, she said that the MCC will begin the ‘five-year clock’ to complete the project. "When the five-year clock starts, the country will have five years to fully start and complete all the infrastructure and construction within that time frame."
The MCC compact is the funding that requires the recipient country to complete the projects ‘on time and on budget’. The MCC does not go for the lowest cost while selecting the contractors, but go for the best value, and from start to completion of the projects, MCC will hold people accountable at each layer for delivering what they are supposed to do to complete 'on time and on budget.'
Nepal is the only recipient of the MCC compact assistance in South Asia while the funding is the largest grant from the US to Nepal. Following Nepal’s strong performance on the MCC policy indicators like economic freedom, rule of law, and control of corruption, Nepal was selected as the eligible country to develop the compact in December 2014.
The signing of the MCC compact funding also coincides with the celebration of 70 years of US-Nepal friendship.

PROJECTS 

Transmission line projects
400kV Hetauda-Ratmate
400kV Ratmate-Damauli
400kV Damauli-Butwal
400kV Ratmate-Lapsiphedi
400kV Butwal-Gorakhpur (Nepal segment)
Power substations in Ratmate, Damauli and Butwal

Road maintenance projects
Charali-Phidim
Dharan-Basantapur
Hetauda-Bhimphedi
Amelia-Tulsipur
Tulsipur-Salyan (under consideration)

Nepal passes ICAO air safety audit

Nepal has passed a safety audit conducted by International Civil Aviation Organisation (ICAO), whichhas led to removal of Nepali airline companies from the Significant Security Concerns (SSC) list of the global aviation watchdog.
The Civil Aviation Authority of Nepal (CAAN) today informed that the ICAO formally notified Nepal that the 'significant safety concern' (SSC) issued to Nepal in July 2013 has been resolved. Meanwhile, the CAAN also clarified that Nepali airlines are yet to be removed from the Air Safety list of European Commission (EC).
The ICAO has removed Nepal from its Significant Safety Concern list," CAAN director general Sanjiv Gautam said, adding that EC has but yet not removed from its Air Safety list. "Nepal will however appeal EC to remove from the list based on the ICAO decision, though there is a slim chance of removal just because of this report.
CAAN is however planning to send a request letter along with the latest ICAO audit report to the EC within a couple of weeks, CAAN informed in the press meet.
The SSC validation committee meeting held in July 20 in ICAO headquarters in Montreal, Canada has decided to resolve the SSC after studying the two-member report from Nepal. ICAO had sent a two-member audit team including Captain Eugene Voundri and Aeronautical Engineer Edmund Bohland earlier from July 4 to 11 to study aviation laws and situation of flight operations here. The team had audited aviation legislation, flight operations, personnel licensing and air worthiness of Nepal’s aviation sector. They had also conducted field observation of national flag carrier Nepal Airlines Corporation (NAC) along with Himalayan Airlines. " The audit report states that Nepal succeeded to meet the ICAO standards," he said, adding that Nepal’s compliance rate was 66.08 per cent, higher than ICAO’s mandatory compliance rate of 60 per cent, according to the report.
The ICAO usually conducts audits of eight elements of aviation including primary aviation legislation, specific operating regulations, safety oversight functions, technical personnel qualification and training, provision of safety critical information, licensing and certification, surveillance obligations, and resolution of safety concerns.
ICAO monitors Nepal’s aviation safety oversight capabilities through the ICAO Coordinated Validation Mission (ICVM). The mission is generally invited by a state when it is fully confident that it has fully complied with the international safety standards.
In July 2013, an ICAO mission visited Nepal to validate the corrective measures taken by the country to address the deficiencies pointed out by the global aviation watchdog in 2009. But having found detected several lapses during the on-site audit held from July 10-16, the UN supervisory body had given the significant safety concern (SSC) tag to Nepal’s aviation sector in its audit report in August 2013. The global aviation body had included Nepal in its bad books in 2013 after it was unsatisfied with the progress made by Nepal to make its airspace safe.
Following the SSC, the European Commission (EC) had in December 2013 blacklisted all Nepali carriers for the worst record of air safety oversight. But CAAN officials said they are optimistic that EC would lift Nepali carriers from its safety blacklist in the upcoming safety committee meeting to be held in Brussels, Belgium this November.

Government may hike milk price

The government is planning to hike milk price within a month.
Considering the demand from farmers that their cost of livestock farming has gone up in recent months, the government has been planning to increase price of the milk after three years. The dairy farmers, who are paid an average of Rs 42 for a litre of milk have been demanding an increase it to Rs 54 per litre.
"The Dairy Development Board (DDB) has recently submitted a study report suggesting the government to hike milk price,” according to spokesperson for the Ministry of Livestock Development (MoLD) Shyam Prasad Poudel. "The government will allow the board to increase the price of milk after thoroughly analysing the report," he said, however, refusing to disclose the new adjustment rate in milk price recommended by the board.
The state-owned Dairy Development Corporation (DDC) will adjust the price of milk following a go-ahead from the DDB and private dairies will also revise the price within one or two days.
The dairy firms have been selling milk with three per cent fat and eight per cent solid-not-fat (SNF) at Rs 64 per litre in the market, while milk with five per cent fat and eight per cent SNF is sold at Rs 80 per litre.
Meanwhile, livestock farmers have said that they should get at least Rs 50 for a litre of milk to sustain their business but the dairy firms have been paying merely Rs 42 or Rs 43 to them.
The country is currently producing an average of 1.8 million metric tonnes of milk annually, according to the statistics of the ministry. "Nepal is more than 80 per cent self-sufficient in milk while the country imports some amount of fresh milk from India during off-seasons."
According to the general manager of DDC Ganga Timsina, the price hike in milk is necessary not only because the production cost of farmers has increased but also due to surging production cost of dairy firms. But the price hike will benefit the farmers as almost 70 per cent of the hiked price will go to farmers and remaining 30 per cent will go to dairy firms.
Earlier, the government had increased the price of milk by up to Rs 10 per litre in December of 2014. The government had then increased the price by eight rupees per litre for milk with three per cent fat and eight per cent SNF and by Rs 10 per litre for milk with five per cent fat and eight per cent SNF.

Industry, service sector lift Nepal's growth: ADB

Robust growth in industry and services lifted growth prospects for Nepal in fiscal 2016-17, as did accelerated earthquake reconstruction, according to the Asian Development Outlook (ADO).
Asian Development Bank (ADB) – unveiling Asian Development Outlook – has said economic outlook for South Asia remains robust, with growth on track to meet projections made in Asian Development Outlook 2017 of 7 per cent for 2017 and 7.2 per cent for 2018.
Agriculture growth in Bangladesh in fiscal year 2016-17 was higher than anticipated, it reported, adding that services growth also outperformed expectations, supported by agriculture growth and solid performances in wholesale and retail trade, real estate, hotels and restaurants, and transport.
In Pakistan, growth was similarly supported by a revival in agriculture, as well as by continued expansion in construction and steady growth in services. Strong private consumption remained the largest contributor to growth.
These improved prospects for Nepal, Bangladesh, Maldives and Pakistan are balanced by slower growth projected for Bhutan and Sri Lanka, the report reads.
The construction of hydropower projects has been delayed in Bhutan, undermining economic growth there. In Sri Lanka, heavy rain caused severe floods in 15 of 25 districts and triggered landslides in some areas in May. Disrupted economic activity and damage to agriculture will slow growth in 2017, but subsequent recovery may boost GDP growth somewhat in 2018.
In India, economic growth slowed to 7.1 per cent in fiscal year 2016-17 – ended on March 31 – from eight per cent in previous fiscal. “The slowdown can be partly attributed to demonetisation and replacement of high-denomination banknotes in November 2016, which affected economic activity in several cash-dependent sectors,” ADB report reads. "India – the sub-region’s largest economy – is expected to achieve previous growth projections of 7.4 per cent in 2017 and 7.6 per cent in 2018, primarily from strong consumption."
Meanwhile, developing Asia is now expected to grow by 5.9 per cent in 2017, or 0.2 percentage point higher than the rate previously envisaged. The smaller upgrade in the 2018 growth forecast – 5.7 per cent in ADO 2017 to 5.8 per cent – reflects a cautious view on the pace of the turnaround in external demand.
“Developing Asia is off to a good start this year with improved exports pushing growth prospects for the rest of 2017,” said ADB’s chief economist Yasuyuki Sawada. “Despite lingering uncertainties surrounding the strength of the global recovery, we feel that the region’s economies are well-placed to face potential shocks to the outlook.”
Excluding the newly industrialised economies of Republic of Korea, Singapore, Taipei, China, and Hong Kong, China, growth projections for the region are revised up to 6.4 per cent for 2017 and to 6.3 per cent for 2018. Projections are upgraded for Central and East Asia.
Likewise, the combined growth forecast for the major industrial economies – the US, the euro area, and Japan – has been retained from ADO 2017.
Economic growth prospects in developing Asia for 2017 have improved on the back of stronger-than-expected export demand in the first quarter of this year, according to the report.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB is celebrating 50 years of development partnership in the region. It is owned by 67 members, 48 from the region. In 2016, ADB assistance totaled $31.7 billion, including $14 billion in co-financing.

ID cards mandatory to deposit money in others' accounts

The central bank has made it mandatory for the depositors to show their identification card, if they are depositing Rs 100,000 or more cash in others' bank account. Bank and financial institutions (BFIs) may not accept cash, if depositors fail to show identification documents and reason for such deposit, according to the new rule introduced by the Nepal Rastra Bank (NRB) to check money laundering and terrorism financing. The new rule came into effect from the new fiscal year.
Earlier, BFIs used to ask clients to show their identity card only when withdrawing huge amount of cash. The central bank has now made it mandatory for the BFIs to seek identification documents even while depositing cash.
The central bank, in its recent circular to the BFIs, said that the new rules has been brought to introduce additional provisions on Money Laundering Prevention Act, 2008 and Assets (Money) Laundering Prevention Rule, 2016, to prevent the financial and banking system getting abused by the dirty money. "The new requirement is to identify and verify the client's identity popularly known as know-your-customer (KYC) process," the central bank added.
Likewise, the clients also cannot do cash transaction of more than Rs 1 million barring some central bank-prescribed circumstances. "The BFIs would also not provide withdrawal of cash of Rs 1 million or higher."
The new rule aimed at curbing abuse of banking channel for money laundering and terrorist financing is cumbersome could also be instrumental for the people to opt for non-banking channel for transaction, according to the bankers. 

Inflation drops to a record low

Consumer price inflation dipped to a record-low level of 2.8 per cent in the 11th month –mid-May to mid-June – of the last fiscal due to improved supply situation and low inflation in neighbouring India, according ot the central bank report. There was unfavourable condition in the country in the previous year which had hit supplies and pushed up prices at a high level. The prices grew at a slower pace since the base was already high in the previous year.
With the prices rising at a slower pace in most of the months of the last fiscal year, the average annual inflation of the country is certain to remain below the 7.5 per cent target of both the budget and Monetary Policy.
Inflation in India during mid-May to mid-June stood at 1.5 per cent. Lower inflation in India directly impacts Nepal as the country also imports inflation due to two-thirds of the total trade with the southern neighbour.
Steep fall in inflation had been witnessed since the beginning of the fiscal year 2016-17 due to high base price of the previous fiscal year, when inflation had skyrocketed along with disruptions in supply lines, according to the current macroeconomic and financial situation of 11 months released by Nepal Rastra Bank (NRB) today.
Food price inflation turned negative one per cent from 11.9 per cent in the corresponding period of the fiscal year 2015-16, the report reads, adding that non-food inflation also moderated to 5.8 per cent from 10.5 per cent in the corresponding period of the fiscal year 2015-16. "The decline in growth rate of prices of clothes and footwear, housing and utilities, communication and health, among others, caused the moderation in non-food inflation,” the report reads.
According to the report, a fall in prices of pulses and legumes by 17.5 per cent, vegetable by 16.3 per cent and ghee and oil by one percent were mainly responsible for such a decline in food inflation. Of food and beverage group, the prices of sugar and sugar products increased 11.5 per cent and alcoholic drinks 10.8 per cent in the review period.
Some analysts say that the inflation has fallen in Nepal as the inflation of India is also on a downward trend in recent months.

Finance Minister pledges tax base expansion, reform

Finance Minister has expressed his commitment to expand the tax base and to reform the tax system to give momentum to the economy.
Addressing a news conference – the first after being appointed finance minister – organised by the Finance Ministry here today, finance minister Gyanendra Bahadur Karki said that the government will meet Rs 730.55 billion revenue mobilisation target for the current fiscal year with expansion of tax base and reforms.
The ministry had mobilised Rs 611.76 billion in revenue in last fiscal year.
"The revenue mobilisation last fiscal year exceeded the target because of broadening of the tax base, upgrading of tax realisation standard, promotion of technology-oriented services in revenue administration, leakage control and administrative reforms," he said, adding that the government was equally conscious and serious regarding plugging revenue leakage. "The success in revenue mobilisation was possible due to the expansion in the number of tax-payers, the favourable economic activities created by the 6.9 per cent economic growth, increase in the investment in the reconstruction works, the new system of tax initiated at the point of origin at customs and tax investigation."
The finance minister, on the occasion, also reaffirmed that the government has laid special emphasis on increasing the capital expenditure, pledging to implement the recommendations made by the high-level tax system review commission.
At the press meet organised to share about the revenue mobilised by the government, he said that the ministry is vigorously working towards propelling the country towards prosperity. "We are committed to providing services and facilities to the people in remote areas," he said, adding that the government, however, expects the active cooperation and support from all the sections of society. 

Nepal presents SDG review report

Nepal has presented its Voluntary National Review (VNR) on the implementation of the 2030 Agenda for Sustainable Development in New York.
Vice chair of the National Planning Commission (NPC) Min Bahadur Shrestha presented the report at the High-Level Political Forum on  Sustainable Development, currently in session under the United Nations Economic and Social Council (UNESC) in New York.
Addressing at the session, Shrestha said that Nepal's expected high economic growth of 7 per cent in the fiscal year 2016-17 may be the beginning of a key turnaround for Nepal’s economic growth that will propel the development.
"The country’s ambitious and rights-based Constitution as the overarching guide to sustainable development," he said, highlighting the importance of forging strong partnerships at the national, regional and international levels and among multiple stakeholders for its implementation.
Despite gaps and challenges, Nepal wishes to swiftly complete the unfinished agenda of MDGs, and step up its efforts to achieve the SDGs, building on the encouraging gains made so far, he added.
Shrestha also updated the forum about Nepal’s plans across different goals and targets and informed that SDG codes are assigned to all programmes under the national budget, together with the tracking of expenditures, among other things.
The High-Level Political Forum is the central platform of the United Nations for providing political leadership, guidance and recommendations for the implementation and follow-up and review of the 2030 Agenda.
Likewise, Voluntary National Review is a mechanism through which member states showcase their progress in achieving SDGs, as well as the gaps and challenges facing them.
The High-Level Political Forum – the second forum after the adoption of the 2030 Agenda in 2015 – is being held on July 10-19 with 44 member states including Nepal presenting their Voluntary National Reviews. 

NRA asks quake victims to collect grant within a year

The National Reconstruction Authority (NRA) – in line with the decision of the 10th steering committee meeting chaired by Prime Minister Sher Bahadur Deuba last week – has set the deadline of mid-July, 2018 to distribute the grant amount to households, whose houses were damaged by the devastating earthquake of 2015.
Identified eligible housing aid beneficiaries should collect the entire grant amount within this fiscal year, the NRA chief executive Govinda Raj Pokharel said, adding that the NRA cannot keep distributing the housing aid for an indefinite period. "So, we would like to urge all the beneficiaries to use the facility extended by the government till mid-July next year."
The specific time has been designated to expedite the post-earthquake reconstruction process.
Those who have collected the first tranche by mid-January 2016 should receive their second tranche by mid-January 2017. For the beneficiaries, who received the first tranche by mid-November 2017 should collect the second tranche by mid-April 2018, he said, adding that the beneficiaries, who received the second tranche by mid-January 2018 should receive the third tranche by mid-June 2018 and those obtaining second tranche by mid-January 2017 should obtain third tranche by mid-July 2018.
Though the NRA initiated the process of distributing the housing grant from March 13, 2016, the process has been pathetic. Till the date, only around 45,000 houses have been rebuilt and 115,000 are under construction. "In contrast, the number of identified beneficiaries in the worst-hit 14 districts stands at 626,694, with additional 98,201 beneficiaries listed in less-affected 17 districts," he added.
Out of the total 724,895 beneficiaries in 31 quake-affected districts, 594,150 have already received the first tranche till date, but the number of households coming forward for the second and third installments of the housing grant is very low, according to the NRA. "Likewise, only 52,166 have received the second installment so far."
Immediately after the devastating 2015 Gorkha earthquake, the government had decided to provide Rs 200,000 per household as private housing rebuilding aid, which was later increased to Rs 300,000 to be distributed in three installments; Rs 50,000; Rs 150,000 and Rs 100,000. The amount is being disbursed in three installments to ensure that the quake survivors rebuild quake resilient homes in line with the compliance and design set by the government.

Government mobilises Rs 612 billion revenue in the last fiscal year

The government has been able to mobilise Rs 612 billion revenue in the last fiscal year.
Finance Minister Gyanendra Bahadur Karki – addressing a meeting of Finance Committee under the Legislature-Parliament – today informed that the government has been able to mobilise Rs 612 billion in revenue in the fiscal year 2016-17.
"It is 108 per cent more than the target," he said, adding that the government had mobilised Rs 565 billion revenue a fiscal year ago. "Zero tolerance policy has been adopted against revenue leakage and irregularities helping the revenue mobilisation to increase."
The government will be strict in checking revenue leakage, he said emphasising has been given on Automated Custom Tax System to control irregularities in the revenue and tax system.
Karki said customs at point of origin and the details of the monitoring and transaction of such transaction from the point of production itself would be brought into the computerised system to check the irregularities seen in the revenue system. "The ministry is working with priority for keeping a close watch on tax and laws," the minister added. "The performance and character of the employees working in the tax administration would be monitored also for checking tax evasion and that preparations were on for formulating and implementing a code of conduct for those working in the customs, revenue and taxation system."
Informing that the ministry is also planning to install IP cameras at 13 places for checking the revenue leakage, Karki said that a local-type tax dispute settlement committee has been proposed in the proposed Revenue Board Act. "It will systematise the tasks of constituting commissions as the Tax Settlement Commission."
Revenue Secretary Sishir Dhungana, on the occasion, said that the issue of working style and transparency was important although it was not in itself bad practice to form the tax settlement commission. He added that such tax settlement commissions are formed in one or the other form in other countries throughout the world as well.
During the meeting, the committee members inquired the finance minister and the ministry officials on revenue mobilisation and initiatives to stop corruption and irregularities seen in the tax administration. 

Local bodies get one-third of government grant

Local bodies have received one-third of the government grant today.
Of the total government grant worth Rs 225 billion that the local bodies are supposed to get in the first quadrimester of this fiscal – according to the budget speech – the local bodies have received Rs 75 billion as the first tranche of the grant in their respective bank accounts.
The government has allocated equalisation and conditional grants to the 744 local units. But the budget has been sent to the local bodies with the elected representatives. The government has yet to hold election in province 2. The local bodies under the Province 2 will get the budget once the election will be held.
According to the Finance Ministry, rural municipalities will get a minimum of Rs 100 million to Rs 390 million, municipalities will get Rs 150 million to Rs 430 million, sub-metropolitan cities will get Rs 400 million to Rs 630 million and metropolitan cities will get Rs 560 million to Rs 1.24 billion.

Hydropower producers appreciated for their contribution

For the first time, the government has feted the private power producers for their contribution to the development of hydropower in the country.
On the 24th anniversary of the establishment of Department of Electricity Development (DoED), the government and Independent Power Producers' Association Nepal (IPPAN) today jointly conferred certificates of appreciation to the independent power producers that operate 58 power plants and Nepal Electricity Authority (NEA) that operates 14 plants.
"All the power plants are now connected to the national grid," said director general of the department Nabin Raj Singh. He also briefed about the fast track licensing services. "The department is now focusing on the study of mega hydropower projects and enhanced supervision and monitoring of the works," Singh added.
The department was formed after the government opened hydropower generation to the private sector that has now an installed capacity almost equal to the government-owned power utility NEA.
"This is the first time the hydropower producers were collectively appreciated for their contribution," according to an architect of the domestically-financed Chilime Hydropower Project Dambar Nepali.
“It's a matter of pride for us to see so many developers from the private sector engaged in hydropower generation in the country,” he added. Nepali is planning to finance and start a large-scale power plant soon.
Promoter of Sanima Hydropower Subarna Das Shrestha, on the occasion, expressed happiness for recognition and pledged to make additional efforts to generate hydropower.
Sanima Hydropower's three plants, with installed capacity of 31.6 megawatts, are in operation currently.
Likewise, president of IPPAN Shailendra Guragain said that the private sector was now engaged in construction of power plants with 3,500 megawatts of installed capacity, with a total commitment of Rs 700 billion. "Construction of these plants will require digging 300-km-long tunnels and constructing 1000-km-long transmission lines,” he added.
Former director general of the department Kishor Babu Aryal, on the occasion, remembered resistance from different quarters to the department's efforts in its early days to help promote private sector. "The establishment of power plants by the private sector itself has proved the success of the department,” he added.
A member of National Planning Commission (NPC) Arbinda Kumar Mishra said that the plan for power generation should be based not in terms of megawatts, but in terms of demand and seasonal variation.

Century Bank acquires Sagarmatha Finance

Century Commercial Bank has acquired Sagarmatha Finance.
Finance Minister Gyanendra Bahadur Karki inaugurated the joint operation of the bank today. After the acquisition, the bank has Rs 5.46 billion issued capital with some 66 branch networks. The bank is also preparing to acquire Alpine Development Bank and Seti Finance in the near future to increase the paid up capital. The central bank has made it mandatory for commercial banks to have Rs 8 billion paid up capital by the end of the current fiscal year.

StanChart Nepal bags ‘Nepal’s Best Bank’ award

Standard Chartered Bank Nepal Ltd (SCBNL) has won 'Nepal's Best Bank' award in the Awards for Excellence 2017, one of the most respected awards in the financial services industry.
Issuing a press note, the bank said that the award was announced on Thursday. According to the bank, recognition of Standard Chartered Bank has come as a result of its ability to deliver on its strategy, progress on its digital agenda, and its ability to create differentiation and for maintaining business momentum despite challenges throughout the year 2016.

UNDP, Chaudhary Foundation partner for SDGs promotion

The Chaudhary Foundation (CF) and the United Nations Development Programme (UNDP) today signed a partnership agreement for the advancement and promotion of Sustainable Development Goals (SDGs) in Nepal.
The agreement was signed by managing director of Chaudhary Foundation Nirvana Chaudhary and UNDP country director for Nepal Renaud Meyer on behalf of their respective institutions.
Under this partnership, the UNDP and Chaudhary Foundation will collaborate to undertake joint initiatives to promote and increase awareness on SDGs by focusing on and mobilising stakeholders for their contribution to the achievement of SDGs in Nepal.
According to the agreement, this partnership will also optimise the contribution of Chaudhary Foundation to local economic development by strengthening linkages between micro entrepreneurs and their businesses, helping Nepal to meet some SDG indicators in the areas of poverty reduction, gender equality, industry, technological innovation and infrastructure.
Speaking on the occasion, UNDP country director Meyer said that SDGs are ambitious, complex and challenging, which is why not just the government but other stakeholders, including civil society and private sector, should put collaborative efforts to achieve SDG targets. “In Nepal, the private sector can play an important role to bring in resources, technology and innovation to aid and accelerate the SDG implementation process,” he added.
The UN General Assembly Summit in September 2015 had adopted 17 SDGs with 169 targets to transform the world to a better place to live in by 2030. Some of the ambitious goals set by the UN Summit for the next 15 years include ending poverty in all its forms everywhere, ensuring healthy life for people, ensuring inclusive and equitable quality education, ensuring access to affordable and reliable modern energy for all, promoting sustained economic growth, reducing inequalities within and among countries, and taking urgent action to combat climate change and its impact.
After the signing ceremony, managing director Chaudhary said that Chaudhary Foundation has given high priority to sustainable social reforms in Nepal and expressed his commitment to facilitate national targets to achieve SDGs.

Climate change to hit development gains

Unabated climate change would bring devastating consequences to countries in Asia and the Pacific, which could severely affect their future growth, reverse current development gains, and degrade quality of life, according to a report produced by the Asian Development Bank (ADB) and the Potsdam Institute for Climate Impact Research (PIK).
Likewise, climate change will also make food production in region more difficult and production costs higher, according to the report. In some countries of Southeast Asia, rice yields could fall by up to 50 per cent by 2100 if no adaptation efforts are made.
Food shortages could increase number of malnourished children in South Asia by seven million, as import costs will likely increase in sub-region to $15 billion per year compared to $2 billion by 2050.
Under a business-as-usual scenario, a six-degree Celsius increase in temperature is projected over the Asian land mass by the end of the century. Some countries in the region could experience significantly hotter climates, with temperature increases in Tajikistan, Afghanistan, Pakistan, and the northwest part of China projected to reach eight degree Celsius, according to the report, ‘A Region at Risk: The Human Dimensions of Climate Change in Asia and the Pacific’, which was unveiled today.
"These increases in temperature would lead to drastic changes in the region’s weather system, agriculture and fisheries sectors, land and marine biodiversity, domestic and regional security, trade, urban development, migration, and health,” the report reads, adding that such a scenario may even pose an existential threat to some nations in the region and crush any hope of achieving sustainable and inclusive development.
More intense typhoons and tropical cyclones are expected to hit Asia and the Pacific with rising global mean temperatures. Under a business-as-usual scenario annual precipitation is expected to rise by up to 50 per cent over most land areas in region, although countries like Pakistan and Afghanistan may experience a decline in rainfall by 20 per cent to 50 per cent.
Coastal and low-lying areas in the region will be at an increased risk of flooding. Indonesia will be the most affected country in the region by coastal flooding with approximately 5.9 million people expected to be affected every year until 2100.
Increased vulnerability to flooding and other disasters will significantly impact the region – and the world – economically. Global flood losses are expected to increase to $52 billion per year by 2050 from $6 billion in 2005.
Marine ecosystems, particularly in the Western Pacific, will be in serious danger by 2100, while climate change also poses a significant risk to health in Asia and the Pacific. Already, 3.3 million people die every year due to the harmful effects of outdoor air pollution, with China, India, Pakistan, and Bangladesh being the top four countries experiencing such deaths.
A business-as-usual approach to climate change could also disrupt functioning ecosystem services, prompting mass migration – mostly to urban areas – that could make cities more crowded and overwhelm available social services, the report has warned. Moreover, a warmer climate for the region could endanger energy supply.
Climate change can exacerbate energy insecurity through continued reliance on unsustainable fossil fuels, reduced capacities of thermal power plants due to a scarcity of cooling water, and intermittent performance of hydropower plants as a result of uncertain water discharges, among other factors. Energy insecurity could lead to conflicts as countries compete for limited energy supply.
To mitigate the impact of climate change, report has highlighted importance of implementing the commitments laid out in the Paris Agreement. These include public and private investments focused on the rapid decarbonisation of the Asian economy as well as the implementation of adaptation measures to protect the region’s most vulnerable populations.

WTO Members reaffirm commitment to Aid for Trade

World Trade Organisation (WTO) members reaffirmed their commitment to the Aid for Trade (AfT) initiative and to the development dimension of the organisation at the closing session of the Aid for Trade Global Review 2017, today.
They underscored, in particular, the important role this exercise plays in helping developing and least developed countries (LDCs) improve their capacities to connect to global markets and lower trade costs.
“There has been a great sense of energy around the Global Review, and this is reflected in the numbers,” WTO director-general Roberto Azevêdo said at the closing session of the three-day event. "Over these 3 days we have seen over 1,500 attendees, 55 sessions and hundreds of pages of analysis," he said, adding that the global trade regime meeting has had a lively and informed debate, looking at the importance of Aid for Trade, and the direction of the initiative in the coming years. "This high level of interest underlines the significance of this work.”
Dedicated to the theme of 'Promoting Trade, Inclusiveness and Connectivity for Sustainable Development', the Global Review provided a platform for high-level discussions on the Aid for Trade initiative, which has made a significant impact in its decade-long existence:
almost $300 billion has been disbursed in Aid for Trade support since 2006; the latest data available from 2015 shows disbursements reached $39.8 billion that year – the highest amount for a single year so far;
Some 146 developing countries have benefitted from this support to date – mainly in Africa and Asia - with 27 per cent of the total going to LDCs.
In his closing remarks, DG Azevêdo stressed the importance of reflecting on what has been achieved so far and asked for the progress to be analysed to make sure that the programme remains relevant to members' needs.
“I see a close synergy and correlation between Aid for Trade and the Sustainable Development Goals (SDGs),” he said. "Achieving economic growth is a key objective for both initiatives. In fact, the SDGs call for an increase in Aid for Trade support for developing countries, particularly LDCs. So we must ensure that Aid for Trade continues to deliver more and better – and that we improve our coordination across the international community.”
He also called upon members to look more closely at the range of specific needs of LDCs and to ensure those needs  are being met, while considering the possibility of directing help in specific sectors, such as tourism – only 1 per cent of Aid for Trade support goes directly to that sector, but for many LDCs tourism represents over 10 per cent of GDP.
Looking forward, DG Azevêdo echoed the calls from many members and institutions to mainstream gender issues into the Aid for Trade work.
“I think we should ensure that future work goes further in taking gender perspectives into account,” he said, adding that there is a need to keep momentum in this area.
Members, on the occasion, acknowledged that, in light of the negative narrative surrounding trade, Aid for Trade should be used to tell the positive story about how trade can help countries escape poverty and connect to global value chains. Members also agreed that digital and physical connectivity clearly intertwine and that both are necessary to make countries reap the real benefits of trade.
“LDCs are yet to tap the full potential of international trade and international support is vitally important for them,” UN under-secretary and high representative for the LDCs, Landlocked Developing Countries and Small Island Developing States Fekitamoeloa Katoa 'Utoikamanu said in an earlier plenary session on enhancing connectivity and advancing the SDGs.
Globally, 3.9 billion people, constituting more than half the world’s population, are still offline. Mobile cellular penetration has reached over 70 per cent in LDCs, but mobile broadband penetration stands at just below 20 per cent compared to close to 50 per cent globally and 90 per cent in developed countries.

IMF delegation holds talk with FNCCI

A delegation of International Monetary Fund (IMF) led by deputy division chief of Asia and Pacific Department Gerard J Almekinders held discussions with the private sector on the industrial environment and investment climate in the country.
During the discussion here today, Federation of Nepalese Chambers of Commerce and Industry (FNCCI) vice president Shekhar Golchha highlighted the team the policy instability and lack of robust infrastructure are the major constraints to accelerate the economic growth in the country by attracting foreign investment.
"The government has taken some initiatives like reforms in laws and policies to improve the investment climate," he said, adding that the country however lacks policy stability and political commitment to move forward.
The IMF team, on the occasion, opined that Nepal should increase investment in human capital and infrastructure to march towards higher growth trajectory. They also hoped for political stability after the local elections, which is crucial for the implementation of the new Constitution.
Stating that the country has recently embarked on the path towards federal structure, the visiting delegation said that Nepal government should to prudently manage the resources at the local level and enhance the spending capacity of local units to strengthen the federal system.

Central bank plans to incentivise remittance to check hundi

The central bank is planning to incentivise remittance to check the hundi, the illegal method of sending money back home by the migrant workers, and bring it into the formal channel.
Responding the lawmakers at the Finance Committee meeting of the Legislature-Parliament, today, deputy governor of the central bank Chinta Mani Siwakoti said that the Nepal Rastra Bank is planning to bring incentive scheme to encourage the migrant workers send the remittance through banking channel.
However, he said that the Nepali migrant workers in South Korea send only 0.84 per cent of the total amount through the formal channel as there is no official channel to send remittance to Nepal. "Though the government sends workers to South Korea on government-to-government agreement, the formal channel has not been utilised by the workers there to send money to Nepal as the Korean government has not yet allowed the Nepali remittance companies and banks to set network.
"Due to poor banking access, migrant workers have to rely on the informal channels," he said, adding that central bank is making the bank accounts mandatory for the migrant workers.
Informing the panel Global IME chairman Chandra Dhakal said that his company is planning to expand money transfer business in South Korea. The South Korean government has recently introduced a law, allowing foreign companies to open remittance services, he said, urging the government to make it mandatory for migrant workers to open bank account under the Employment Permit Service (EPS).
According to the central bank, Nepal received Rs 623 billion remittance in the first 11 months of the current fiscal year. The figures stood at Rs 665 billion and Rs 617 billion in 2015-16 and 2014-15 respectively.
However, only 70-80 per cent of the total remittance is being sent through formal channels, according to the central bank study. The country received rest of the amount through informal channels, popularly known as Hundi.
Since these informal channels are generally perceived to be less secure, sensitive to misuse for illegal purposes, and less beneficial to the country’s economic development, the central banks and other authorities have been expressing concerns over the use of informal channels to remit funds.
Likewise, Siwakoti said that the government has also been facing challenges to formalise remittance inflow from Dubai. "Most of the migrant workers prefer purchasing gold and other goods rather than remitting money from Dubai," he added.
The government has allowed Nepalis to go to 110 countries to work. There are 1,033 licenced recruiting firms and 40 companies working as fund transfer managers abroad.
The lawmakers on the occasion, asked the government to launch schemes to encourage migrant workers to send remittances through the formal channel. Urging the government to take carrot and stick approach for bringing remittances into the country through formal channel, they also asked to announce schemes to increase the flow of remittances from South Korea, India and the United Arab Emirates (UAE) through the banking channel.
Former finance minister Surendra Pandey, on the occasion, said that the government should provide incentives to migrants who are working to attract more remittances through banking channel.
"The Pakistani government has provided incentives to their migrant workers to increase the inflow of remittance through formal channel by paying transfer charge that is incurred while remitting money,” he said, asking the government to replicate Pakistan model. "Nepal has received remittance worth Rs 4 trillion in the last 20 years but the inflow of remittances has been slowing down since the last few years, thus, the government should incentivise it."
Likewise, finance minister Gyanendra Bahadur Karki, on the occasion, informed that the government was committed to attract remittances. "We have discussed with the Nepali ambassador based in South Korea to establish a formal channel to bring remittance from the country during our visit there last month,” he added.
Finance secretary Shanta Raj Subedi, on the occasion, said that the outflow of migrant workers has been declining since the last three years. "The outflow of migrant workers has been declining since the devastating earthquakes of 2015,” he said, adding that decline in outflow of the Nepali migrant workers has hit the remittance inflow. "The government has not been successful in attracting migrant workers to invest in the Foreign Employment Saving Bonds."
Any significant drop in remittances, which equals to 30 per cent of the country's GDP, will hit the country's foreign exchange reserve and balance of payment (BoP) situation.
Likewise, former finance minister Dr Ram Sharan Mahat said that the government needed to develop a mechanism to channelise the remitted money in the productive sectors. "Some 27 per cent of the money that the migrant workers bring home is deposited in the banks and financial institutions," he added.
Also speaking at the meeting, minister for Labour and Employment Farmulha Mansur said that the ministry was bringing a rule that require overseas job aspirants to have two bank accounts before flying abroad. “They can directly transfer their money for saving purpose in one account, while the other account will be opened on their family member's name could be used to transfer money for household expenses," he said, adding that the  mandatory provision will help in increasing the use of formal channel.

NRA approves Rs 145 billion budget for next fiscal year

The Nepal Reconstruction Authority (NRA) has approved Rs 145.93 billion budget for the fiscal year 2017-18 despite sluggish progress in the post-quake reconstruction in the current fiscal year.
The budget is an increment of 31 per cent compared to the current fiscal year as the government had allocated around Rs 111 billion for the current fiscal year 2016-17. However, the NRA has been able to spend less than half to only Rs 42.42 billion due to sluggish progress in the reconstruction drive.
"The budget for the next fiscal year is flexible as the size of recurrent expenditure has increased," NRA chief executive officer Govind Raj Pokharel said. "The budget enables us to short out issues that may surface as the work progresses," he said, explaining that the authority prepared the working plan with emphasis on increasing income, investigation of construction technology and materials, geology and gender and social inclusion apart from participatory approach in the reconstruction process.
Based on the working plan, the NRA will have to identify households under threat and beneficiaries by August 2018. The grant agreement with earthquake survivors, who wish to relocate on their own, should be completed by mid-October 2017. The NRA has so far identified 112 settlements in Selang of Sindhupalchok, Keraunja of Gorkha, Khalde of Rasuwa, Urleni of Nuwakot and Besimpa of Dolakha as the vulnerable zones. Quake survivors living in those areas are being resettled in integrated settlements.
The 10th steering committee meeting chaired by Prime Minister Sher Bahadur Deuba today also directed the NRA to expedite the reconstruction drive, making a decision to specify time for distributing grant for the construction of private homes.
However, vice-chair of the NRA steering committee meeting and leader of CPN-UML Bhim Rawal accused NRA for its failure to work according to the action plan. He criticised the sluggish work in progress of the NRA and the failure to meet the action plans. He also urged the stakeholders to be serious in the reconstruction citing that it is the responsibility of all to put their efforts in the reconstruction job.
The steering committee meeting of NRA comprises of the Premier as the chairperson of the board committee and leader of the main opposition party as vice-chairperson.
The meeting has also authorised the NRA to open eight contact offices that will look after 17 earthquake affected districts on top of those already in place in the 14 worst-hit districts for facilitating the reconstruction process.
The steering committee meeting has also endorsed an authority’s working plan that has designated specific time for different rebuilding activities, spokesperson of the authority Yam Lal Bhushal said. "The allocated budget will be utilised for reconstruction and reestablishment projects through various departments," he said, adding that the meeting has also endorsed the action plans and policies for upcoming fiscal year.
The authority will implement the plans and policies from the very first day of the new fiscal year. These plans have paved a way for the reconstruction projects.
“Before my tenure, it had been told that around 65,000 houses were completed," he said, adding that in reality, only few were constructed. "Construction of around 40,000 earthquake resilient houses has been completed, while over 110,000 homes are under construction," he added. “Over 150,000 households will have roof before Dashain festival." Besides, the NRA has aimed to complete construction of 1,000 schools in the second phase by mid-December 2017; 2,000 schools in the third phase by mid-December 2018 and 1,000 schools in the fourth phase by mid-December 2019.
The devastating earthquake in 2015 had not only floored the ancient temples and residential houses but also had severe impact on schools, and health posts apart from the police posts. By now only 2,100 schools have been rebuilt, according to the NRA that also plans to complete reconstruction of health facilities in the next three years. Reconstruction of 230 health facilities has been completed so far, while 140 are under construction.
The NRA will also be launching a pilot programme for preserving ancient, indigenous settlements and heritage sites in places like Sankhu, Bungamati, Khokana, Nuwakot, Gorkha and Dolkha in the fiscal year 2017-18.
The NRA has also been authorised to extend Rs 50,000 additional housing grant for six traditional settlements – Sankhu, Khokana, Bungamati, Gorkha Durbar Square area, Nuwakot Durbar Square area and Bhimeshwore temple area of Dolakha district – and waiver of fees for the approval of designs of houses from concerned municipal offices.
There are altogether 3,000 houses in these six settlements. "We can expect the traditional ambiance in these settlements to remain intact after rebuilding,” Pokharel added.

Connectivity and inclusiveness highlighted at opening of Aid for Trade global review

Continued support is needed to improve connectivity, lower trading costs and increase women’s participation in trade, particularly in developing and least developed countries (LDCs), speakers at the opening plenary session of the Aid for Trade (AfT) Global Review 2017 said.
Providing the support will ensure trade contributes further to alleviating poverty and achieving the Sustainable Development Goals (SDGs), the speakers said, on the occasion.
"Many factors inhibit connectivity and inclusiveness, whether it’s poor infrastructure, high trading costs, or gender discrimination," WTO director-general Roberto Azevêdo said at the opening of the three-day event. "And they all act as major constraints on sustainable development," he said, adding that work to bring down these barriers can go a long way to connect more people and improve more lives.
The biennial Global Review provides a platform for high-level discussions on the Aid for Trade initiative, which aims to build the trading capacity of developing countries and LDCs. This year’s Global Review is dedicated to the theme of 'Promoting Trade, Inclusiveness and Connectivity for Sustainable Development'.
According to DG Azevêdo, the right infrastructure must be in place to activate trade’s ability to deliver sustainable development. This includes the physical infrastructure of essential roads and ports, the soft infrastructure of rules, institutions and skills that help players take part in trade, and the digital infrastructure to connect people to the global marketplace at lower costs.
"The Trade Facilitation Agreement," he added, "is also a tool that helps cut trade costs, with developing countries and LDCs to benefit most. We need to make a difference in all of these areas – and this is why Aid for Trade is so important."
Since the Aid for Trade initiative was launched, almost $300 billion has been disbursed for Aid-for-Trade support in 146 developing countries and LDCs, DG Azevêdo said, pointing to data in the WTO-OECD publication titled 'Aid for Trade at a Glance 2017', which was launched at the opening session. "A huge body of research, including some 500 case stories, illustrate further the difference Aid for Trade has made," DG Azevêdo added.
Likewise, UNCTAD secretary-general, Mukhisa Kituyi highlighted the constraints faced by developing countries and LDCs in participating in trade, particularly online. "At a time when global commerce is going electronic, if you are not visible, you are not existent," Kituyi said.
Aside from digital connectivity, physical connectivity remains an important factor for trade, secretary-general of the Organisation of Economic Co-operation and Development (OECD), Angel Gurría said, adding that trade facilitation and the offline infrastructure for trade - roads, ports, and bridges - are ever more important in the digital world.
"Aid for Trade is central in ensuring benefits from cross-border trade reach women, small firms, entrepreneurs, farmers, everyone everywhere,” senior director of the World Bank Trade and Competitiveness Global Practice Anabel Gonzalez said, adding that Aid for Trade initiatives work best when they are done in a coordinated manner in partnership with all stakeholders.

Lords Hotels to launch four hotels in Nepal by year end

Lords Hotels & Resorts plans to open two hotels in Nepal this year. The hotel group is focusing towards achieving 68 per cent growth in their overall average room occupancy by the end of fiscal year 2017, according to the group that presently operates 26 hotels with an inventory of 1,544 rooms under its belt.
"Last year, Lords Hotels Group recorded an average room occupancy of 64 per cent," said Lords Hotels & Resorts vice president Rishi Puri. "We recently opened a 110-room hotel in Nepal and will add four more hotels to our portfolio by the end of 2017," he said, adding that considering the expansion spree, the company is hopeful of achieving 68 per cent average room occupancy.
The mid-market hotel brand currently operates 15 hotels in Gujarat alone apart from in some other popular destinations like Agra, Bengaluru, Jammu and Kashmir, Rajasthan and Kerala.
Overall, corporate travel segment has been the best performing traveller segment for the Lords Hotels & Resorts followed by the pilgrim travel segment. "Corporate travellers since the start have been the main contributors for us across all our hotels," explained Puri.
We have to trade with caution. Though the government decisions have hit us hard, we are trying to adjust,” he said.

Fertility and mortality rates fast declining in Nepal: Report

A United Nations Population Fund (UNFPA) report revealed that the fertility and mortality rates in Nepal have been fast declining in the recent years.
The average annual population growth rate in Nepal between 1961 and 2001 was 2.25 per cent, which declined to 1.35 per cent between 2001 and 2011, reads the report released on the eve of the Population Day today.
Nepal, like other the South Asian countries, has been undergoing rapid demographic changes during the last few decades. The working age population between 15 to 64 years has been increasing in Nepal.
In 1991, the working age population was 52.9 per cent of the total male population and 55.3 per cent of the female population. In 2011, the male working age population had increased to 57.9 per cent and the female working age population had increased to 61.6 per cent. The relatively lower proportion of working age men to women is likely attributed to the fact that many men leave the country for foreign jobs, according to the UNFPA report.
“The circumstances in which the average Nepali lives is still far from the targets the SDGs seek to achieve," it reads, adding, "Overall, poverty has declined but it has worsened in the high mountain region and in urban centers."
"School enrollment for girls has improved substantially but the drop-out rate is high," it further reads, adding that sexual discrimination is high among women and girls in the Tarai, among Dalit and women with no education. "Sex-selective abortion practice appears to be increasingly evident in some parts of Nepal as 12 of Nepal's 75 districts, which comprise over 25 per cent of the total population, show sex ratio at birth over 110, per 100 females."
Spatial distribution of population shows an ever declining share of the mountain and hill population compared to the Tarai population. In 1971, the proportion of the total population living in the mountain and hill regions combined was 62 per cent, this declined to 50 per cent by 2011.
It is projected that by 2031 this proportion will shrink to 47 per cent although the land mass in the mountain and hill regions is 77 per cent, the UNFPA report reads, adding that among the seven federal provinces, Province 3's share of total population is 21 per cent followed by Province 2 with 20 per cent, provinces 1 and 5 have 17 per cent each, Province 7 ten per cent and Province 4 nine per cent. "The ranking of the projected populations for the seven provinces remains the same, even until 2031, according to CBS, 2014."
As part of the formulation of its new UN Development Assistance Framework (UNDAF) for 2018-2022, Nepal is aspiring to graduate from the least developed country (LDC) to a middle-income country by 2030 by achieving the Sustainable Development Goals (SDG). The National Planning Commission (NPC) has also endorsed a new three-year Development Plan, the 14th Plan (2016/17-2018/19).
Given the enormous data need required by the SDGs, Nepal is not currently in a position to produce the data and statistics required for monitoring progress in the attainment of all 17 goals and 169 targets of the 2030 Agenda adopted by the world leaders at the UN Sustainable Development Summit on September 25, 2015, it adds, projecting Nepal's demographic transition and resulting population momentum using key demographic variables for the next 15 years (2016-2030) in the context of the new federal structure of the country.
The total population of Nepal comprises of over 125 caste/ethnic groups. The largest group is Janajati (36 per cent) , followed by Chhetri/Bahun (31 per cent), Tarai castes and Dalit both (14 per cent) and the minority Muslim (4 per cent).  In four out of seven provinces, the largest group is Janajati, in two provinces it is Chhetri/Bahun and in one province it is Tarai castes.
The report 'UNFPA Nepal 2017 Population Situation Analysis of Nepal' notes the absence of a large number population estimated at around 1.92 million as of 2011 as they are outside the country for work or study. Nepal's population of 26.5 million as per the 2011 Census is projected to grow to 30.4 million by 2021 and 33.6 million by 2031.

ADB to help Nepal improve customs reform, modernise trade facilitation

The Asian Development Bank (ADB) has approved a $21-million policy-based loan to support Nepal government’s efforts to simplify, harmonise, and modernise the country’s trade processes and meet international standards.
Issuing a pree note, the Manila-based regional development bank said that its board of directors has approved the loan that will support the government in developing its national policy and legal framework for trade facilitation as well as customs procedures.
The project will support Nepal to develop a national policy and legal framework on trade facilitation and customs procedures. It will also help strengthen the organisational structure of the Department of Customs (DoC) to boost exports and raise export competitiveness.
“It is important for a landlocked country like Nepal to explore better and a more modern trade facilitation as a means to promote exports and, eventually, economic growth and development,” according to ADB senior economist Sonoko Sunayama. "Hopefully, the project can help the government of Nepal achieve this for its growth and development."
The project supported by the Manila-based multilateral financial institution is expected to help the country fulfill commitments on trade facilitation made to the World Trade Organisation (WTO) and meet international standards on customs procedures. "The project will also assist Nepal to integrate better, in terms of trade facilitation and customs procedures, with the standards of the South Asia Subregional Economic Cooperation,” according to the ADB press note.
ADB – based in Manila – is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, ADB is celebrating 50 years of development partnership in the region. It is owned by 67 members, 48 from the region.
In 2016, ADB assistance totaled $31.7 billion, including $14 billion in cofinancing. 

Central bank bars Axiata from repatriation of dividends

The central bank has barred Axiata from repatriating its dividend until the issue of capital gains tax related to the Ncell deal is settled.
Nepal Rastra Bank (NRB) has barred the Malaysia-based foreign investor Axiata from repatriating its dividend, as the tax administration is in the process of taking necessary steps to recover the Capital Gain Tax (CGT). The seller of Ncell – TelaiSonera – has left the country without paying the CGT, which now  sems to be the responsibility of the buyer Axiata. The CGT issue has been under discussion in the parliamentary committees, though they have different interpretation on who has to pay the CGT, the buyer or the seller.
The Malaysian telecommunication company Axiata had acquired Ncell’s stake from the Swedish company TeliaSonera last year. TeliaSonera has already repatriated its dividend till fiscal year 2011-12.
According to the share purchase agreement between TeliaSonera and Axiata, the latter will repatriate the dividend after fiscal year 2012-13. Axiata has already submitted a request to the central bank for dividend repatriation. As the custodian of the foreign exchange reserve, the central bank is authorised to issue the final approval for dividend repatriation.
According to central bank officials, Ncell has set aside Rs 72 billion for dividend repatriation for the period between fiscal year 2012-13 to fiscal year 2015-16.
After the central bank's directive, Axiata will not be able to take away dividend until the selling company TeliaSonera clears its tax liability.
According to income tax law, of the 25 per cent applicable CGT in any major deal, it is the responsibility of the acquiring company to directly pay 15 per cent to the government as tax deducted at source and the remaining 10 per cent needs to be filed by the selling company.
Axiata – the buyer of Ncell – has so far filed Rs 23.56 billion in two installments as CGT and has claimed that it has cleared all its tax liabilities.
TeliaSonera – the seller – is accountable to pay the remaining 10 per cent of CGT, it has claimed in a response to the letter from the Large Tax Payers’ Office, that it has met all the tax requirements while operating Ncell between 2008 and 2016.
The central bank has also said no Nepali company or person can transfer funds to firms associated with TeliaSonera as it has not cleared its liability.
The central bank has also flagged other foreign companies including Renold Holdings; St Kitts and Nevis; TeliaSonera UTA, the Netherlands; TeliaSonera Asia Holding, Norway; TeliaSonera Norway Nepal Holding; and SEA Telecom Investment BB, the Netherlands.

Lack of infrastructure hits Nepali ICT sector

Lack of reliable supporting infrastructure has prevented the country's information and communication technology (ICT) to take maximum advantage offered by the World Trade Organisation’s (WTO) Services Waiver provision accorded to the least-developed countries (LDCs), according to the stakeholders.
Speaking at a half-day workshop on 'WTO Services Waiver: Exploring opportunities and challenges for Nepal' organised by Ministry of Commerce, together with South Asia Watch on Trade, Economics and Environment (SAWTEE),  executive chairman of SAWTEE Dr Posh Raj Pandey explained the General Agreement on Trade in Services (GATS) under the WTO and the Services Waiver provision accorded to the LDCs.
Pandey also presented the status and trend of services sector in the Nepali economy.
The workshop organised with an objective to discuss the status of services sector in the Nepali economy and its role in export promotion also discussed the multilateral rules governing the services sector, including Services Waiver, and explored ways to benefit from the waiver provided to the LDCs by the developed and developing WTO members.
WTO members adopted a decision to provide preferential treatment for services and services suppliers of the LDC members at the Bali Ministerial Conference, and is generally known as the ‘Services Waiver’.
The preferences are subject to terms, limitations and conditions specified in the schedule of services commitments of the member countries. In response to the collective request of LDCs, the members of the WTO have submitted their services waiver commitment to the WTO Council for Trade in Services. So far 23 WTO members have submitted their Waiver commitments. The LDCs have 15 years from the day the Waiver is notified to the WTO to benefit from the provision.
Pandey's presentation focused on various Waivers provided by the developed and developing WTO members within the 12 sectors and four different modes of services trade defined under the WTO regime. He highlighted the market access and national treatment provisions in the Waiver notifications of countries that may be possible destination of services export of Nepal, such as the European Union, China, United States, India, and Australia. He explained the Waivers provided in sectors such as Communication services, Construction services, Education services, Financial services and Tourism and travel related services.
Speaking on the occasion, commerce secretary Naindra Prasad Upadhyaya opined that there is a need for wider consultation with the private sector to understand the nature and direction of the services sector in Nepal to be better prepared to undertake negotiations in the bilateral, regional and multilateral levels.
Likewise,  president of Federation of Computer Association of Nepal (FCAN) and chair of ICT Development Committee under Federation of Nepalese Chambers of Commerce and Industry (FNCCI) Binod Dhakal commenting on the presentation, highlighted the difficulties faced by the ICT sector in Nepal. There are difficulties related to the use of forex, visa restrictions while visiting their counterparts in the developed countries, ambiguous national laws, among others, as factors hindering Nepali ICT sector. Unreliable electricity supply and weak internet connection has further weakened Nepal’s capacity, he said, adding that there should be a single ministry to handle the ICT-related matters in Nepal. ICT sector is currently governed by the Ministry of Information and Communication and Ministry of Science and Technology. He also pointed out that there are numerous Business Process Outsourcing (BPO) companies operating from Nepal but they are not in the formal regulatory ambit to avoid regulatory hassles.
Likewise, joint secretary at the Ministry of Commerce Toya Narayan Gyawali, on the occasion, informed the floor that the government puts ICT on the forefront while designing its development strategy. He also opined that the LDC Services Waiver can also be instrumental in achieving the SDGs in the long term. He also pointed out the lack of reliable data pertaining to service sector as one of the impediments while designing policies.
Steered by rapid growth in telecommunications, tourism and financial sectors, services sector is now the largest contributor to the GDP. The share of services in the GDP increased from 26 per cent in 1980 to 52 per cent in 2014-15, whereas agriculture and industry contributed 33 per cent and 15 per cent respectively. In 2015, services exports contributed to 63 per cent of the total exports and reached $1.4 billion by value. The services exports are largely driven by travel and telecommunication (80 per cent in 2014), including an informal and rudimentary IT sector. Nepal’s export of labour services (Mode 4) in the form of labour migrants is specifically important as the workers’ remittances in 2014/15 contributed to 29 per cent of the GDP.
The workshop brought together government officials, practitioners, private sector representatives, media personnel, academics and various other stakeholders to share their knowledge and experience in services trade. A total of 40 participants attended the programme.