Tuesday, March 30, 2010

Comen starts crude oil, natural gas contracts

Commodities & Metal Exchange Nepal (Comen) has opened two new commodity futures contracts trading platforms -- 'crude oil' and 'natural gas' -- from today.
"As a part of our constant efforts to provide value and new products to our investors, we are pleased announce two new products," said Vijay Satyal, chief executive officer of Comen.
The contract symbol for crude oil is CRUDE OIL and Comen is launching CRD/APR/10 contract. The trading unit for crude oil is 100 barrels and the base price will be displayed per barrel, he said adding that the intra-day margin is Rs 40,000 per unit with an overnight equity of Rs 80,000 per unit.
The commission charge will be Rs 1000 and VAT.
Similarly, the contract symbol for natural gas is NATURAL GAS and Comen is launching NG/APR/10 contract. According to Comen, the trading unit is 1250 mmBtu and the base price will be displayed per mmBtu.
"The intra-day margin is Rs 30,000 per unit with an overnight equity of Rs 60,000 per unit," it added. The commission charge will be Rs 1000 and VAT.
"We also remind our customers that these two contracts are subject to cash settlement," Satyal added.

Monday, March 29, 2010

NT AGM approves 35 per cent cash dividend

The second annual general meeting (AGM) of Nepal Doorsanchar Company Ltd -- popularly known as Nepal Telecom (NT) -- has approved 35 per cent cash dividends to its shareholders here today.
The NT board last month has proposed 35 per cent cash dividends to the shareholders.
The company has, last fiscal year, registered Rs 10.18 billion net profit -- an increase by 31 per cent over last year's turnover, said the company. "The per share income has also incresaed to Rs 67.85 that is also an increase of 28 per cent," said the NT, which has been listed under the Class-A companies at the Nepal Stock Exchange (Nepse).
"NT's teledensity has increased to 17.84 telephone lines per 100 persons," Sushil Ghimire, NT chairman said, addressing the shareholders. "We have extended our PSTN (land line) services in all the 75 districts headquarters," he said, adding that GSM and CDMA service of NT is also available across the country.
Registered on 2060-10-22 under Company Act, 2053, the then Nepal Telecommunications Corporation (NTC) was dissolved and all assets and liabilities were transferred to Nepal Telecom (NT) with effect from April 13, 2004. The company had floated its shares under the disvestment programme of the government and called the bid for its shares quoting Rs 600 minimum after adding Rs 500 premium to the face value of Rs 100 for each unit. However, investors have quoted a maximum of Rs 2,550 to the lowest of Rs 600 for a unit of share.
As part of the disvestment and privatisation plan, the government had sold NT's 10 per cent shares -- five per cent to the public and five per cent to the staff. The staff were offered the shares at a subsidised rate of Rs 90 per unit.
The NT, according to the Ministry of Finance's divestment plan, floated 75,00,000-unit of shares -- that is five per cent of the total -- in the first phase to the public. However, due to various reasons, it was under-subscribed to only above 53,00,000-unit shares.
Last year, in the first ever AGM, it had distributed 25 per cent cash dividends. But with increasing profits, NT has decided to distribute 35 per cent cash dividends from last year's profits.
NT's share listing was the largest ever share listing worth Rs 15 billion in the domestic secondary market.

Etihad Airways connects Kathmandu with Tokyo via Abu Dhabi

Etihad Airways, the national airline of United Arab Emirates (UAE), has started a non-stop flights from Abu Dhabi to Tokyo making it more convinent for the passengers to fly to and from Tokyo linking Kathmandu.
The daily flights will link Kathmandu with Abu Dhabi and Tokyo very conveniently without passengers having to wait for hours in transit.
The inaugural flight -- EY878 -- departed Abu Dhabi on March 27 and landed at Narita Airport in Tokyo yesterday making it the first Middle Eastern airline to expand its service to the Japanese capital.
The flights will be operated by three-class Airbus A330-200 aircraft and will feature in-flight services dedicated to the Japanese market, including a tailored menu, local in-flight entertainment content and cabin crew consisting of a number of Japanese speakers and nationals.
James Hogan, Etihad Airways' CEO said Etihad was delighted to be the first Middle Eastern carrier to operate to Tokyo, and was expecting a high volume of traffic on the route, particularly business travellers. "We also believe the variety of high profile attractions opening in Abu Dhabi in the coming years, including Ferrari World, The Louvre Abu Dhabi and Guggenheim Abu Dhabi, will be very attractive to Japanese leisure travellers," he said, adding that Japan is a key market for Etihad.
Buddha Air to fly high
KATHMANDU: The Ministry of Tourism and Civil Aviation has permitted Buddha Air to begin international flights. Buddha Air has been granted permission to launch flights on Pokhara-Lucknow, Janakpur-Patna and Kathmandu-Thimphu routes. The flights to Bhutan will be launched within one-and-a-half month. However, flights on Patna-Lucknow route will take a little while. Buddha Air will launch internal flights through its 47-seater ATR 42 planes that are considered regional crafts. Later the service will be provided through 66-seater ATR 72 plane. Buddha Air will make four to six flights a week to Bhutan.

Asia-Pacific to see a surge in tourists arrival
KATHMANDU: The Executive Board of the Pacific Asia Travel Association (PATA) on Monday released its forecasts of tourism demand across the Asia Pacific region for the next three years. At the aggregate level, international arrival numbers are predicted to increase by an average of around 2.7 per cent each year to 2012. Not surprisingly, these forecasts show a significant slowing in growth rates from the pre-financial crisis level of seven percent per annum. According to PATA Chairman Phornsiri Manoharn, the three-year projections are very much in line with expectations on how the global economy is expected to perform generally. Overall international arrivals growth to Asia Pacific destinations. On a sub-regional grouping basis, destinations that in aggregate, make up South Asia are forecast to grow the fastest at an average rate of +4.9 per cent per annum over the period to 2012, followed by Southeast Asia at +4.8 per cent.

Sunday, March 28, 2010

Tanker drivers strike hits fuel supply

Scarcity of fuel has once again hit consumers as tanker drivers ferrying petroleum products started protest in the Valley against the traffic police decision to prohibit their entry into the city during daytime.
The protestors have halted transport of fuel to refilling stations since Friday, despite Nepal Oil Corporation's (NOC) promise to help them sort out the problem. The protesting drivers have warned that they will continue the strike to halt ferrying petroleum products until NOC allows them to operate in the city areas at any time of the day.
As part of their strike, they have also stopped tankers owned by dealers. Over 200 tankers are said to have been stranded due to their strike as most refilling stations in the Valley are located within the Ring Road.
The state oil monopoly yesterday sought seven days' time to hold talks with traffic police and sort out their problems.
Approximately 2,500 retail dealers throughout the nation manage the sales for petroleum products -- petrol, diesel, kerosene and LPG from NOC. There are 116 retail distributors for Kathmandu valley in particular.
The storage capacity for petrol is Kathmandu is 1,870 kiloliters, Diesel is 8,400 KL, and kerosene 4,960 KL. The products are transported from the depots to the retail dealers by tankers.
The number of transporters throughout the Nepal is 494, and 1180 tankers are engaged in transporting. The present storage capacity of NOC is 71,558 KL. However, it is just enough for 15 days only. Currently, the oil monopoly is working on developing storage facilities for petroleum products to have a storage caopacity for meeting the demand for at least 30 days
According to NOC deputy director Mohan Karki, the countrywide demand for petrol is 12,000 KL per month, diesel 60,000 KL and kerosene 7000 KL per month. "We are pretty much meeting the demand and supply ratio and there is no calamity as far as fuel is concerned," he added.
Nepal is increasingly dependent on oil for meeting its energy requirement. The demand for petroleum products is increasing by 20 per cent annually. Petroleum products constitute about 11 per cent of the total energy consumed in Nepal.
Approximately 70 per cent of all petroleum products are consumed in the central region.

FNCCI urges security, regular power supply

Industrialists today said that the industrial sector can survive only when the government gives a guarantee of security, provides adequate power supply and solves the problem of liquidity crunch.
Highlighting the problems currently facing Nepali industrialists, traders and entrepreneurs during the 57th annual general meeting (AGM) of Nepal Chambers of Commerce (NCC) here today, NCC president Surendra Bir Malakar said, "There is a lack of security, unending bandhs and load-shedding."
He said the growing Balance of Payments (BoP) deficit, shrinking exports, high interest rates and liquidity crunch are bleeding the economy white.
"With the BoP deficit at Rs 20 billion this fiscal year, productivity has declined by 0.5 per cent and in the first six months of the current fiscal year inflation has risen to 11.3 per cent while exports exceeded imports by six per cent," he added.
"The economy is in a critical situation because the government is concentrating more on remittances than on industrial development and giving more priority to revenue collection than private sector promotion," blamed the Chamber's president.
Federation of Nepalese Chambers of Commerce and Industry (FNCCI) president Kush Kumar Joshi seconded Malakar's argument and said that Nepali entrepreneurs do not have a conducive environment for operating their businesses due to lack of security, power shortage, high rate of interest and lack of liquidity.
"If the situation does not improve, the entrepreneurs will be compelled to shut down their businesses," he warned, adding, "It's the bitter truth, not a threat. If businesses collapse, it will be harder for them to take off again."
However, Prime Minister Madhav Kumar Nepal, as usual, assured them of security. "Nobody notices the improvement in security," he complained, adding that there has been a palpable improvement in security situation, "except for some incidents."
"The government is really trying to create a safer environment for industrialists and working for the establishment of industrial security force," Nepal said. "Since the nation is going through a transitional period, the economic sector is also not unaffected."
He, however, said that it was definitely shocking despite all the forecasts about load-shedding by Nepal Electricity Authority that the government was unable to increase the power supply or bring an alternative energy.

Award winners
KATHMANDU: Prime Minister Madhav Kumar Nepal on Sunday awarded the top performing exporters and cargo agents at the Nepal Chambers of Commerce (NCC) 57th annual general meeting (AGM).
In the cargo's category, Everest De Cargo, Himalayan Travels and Tours Pvt Ltd, Speed Way Cargo Pvt Ltd, Himali International Cargo Pvt Ltd and Muktinath Cargo Pvt Ltd won the award.
In the carpet export category, Tibet Carpet, Kathmandu Valley Carpet Industries Pvt Ltd and Shangrila Carpet and Handicraft Pvt Ltd received the award.
In the readymade garments export category, Nepal Fashion Pvt Ltd, United Colours Fashion Pvt Ltd and Everest Fashion bagged the award.
The winner of Pashmina exporting group was Everest Pashmina Knitting and Weaving.
In the handicrafts exporting category, Asiatic Traders and Exporters was selected to receive the award.
DHL Express Nepal Pvt Ltd and Kiran Shoes Manufactures bagged the award in recognition for highest exports to India and third countries on the basis of Certificate of Origin.
Nepal Chamber Excellence Award 2010 was awarded to Nepal Herbs and Herbal Products Association for its works in export promotion.

Friday, March 26, 2010

Global trade to grow by 9.5 per cent in 2010

World trade is expected to grow by 9.5 per cent in 2010, after suffering its biggest collapse since World War II in 2009, the head of the World Trade Organisation (WTO) Pascal Lamy said on Friday.
"Our economists are forecasting a world trade growth for 2010 of 9.5 per cent with developing countries' trade growing 11 per cent and industrialised countries' trade growing by 7.5 percent," the WTO director-general said.
"This means that trade-wise, there is light at the end of the tunnel and it's certainly a good forecast, good news for the world economy," he added.
World trade plunged 12 per cent in 2009 due to the global economic crisis. AFP

Experts suggest cautious approach to TIFA

Experts today suggested some changes in the draft of the Nepal-US Trade and Investment Framework Agreement (TIFA). "The TIFA draft has not mentioned a word about preferential market access or reducing tariff, each of which is a key to the Nepali export sector," they said.
Speaking at a stakeholders' consultation on Nepal-US TIFA here today, commerce secretary Purushottam Ojha said that the government is positive towards the suggestions made by the stakeholders. "TIFA will create a platform for further negotiations," he said.
"Apart from TIFA, there are many issues to be taken up with the US," Ojha said adding that Nepal also needs to diversify and develop new products, and maximise the utilisation of Generalised System of Preferences (GSP) which is a formal system of exemption from more general rules of World Trade Organisation (WTO).
Specifically, it's a system of exemption from the most favoured nation principle (MFN) that obliges WTO member countries to treat imports of all other WTO member countries no worse than they treat the imports of their 'most favoured' trading partner. In essence, MFN requires WTO member countries to treat imports coming from all other WTO member countries equally. This means imposing equal tariffs on them.
"However, we should be aware of the WTO plus arrangements in the TIFA to protect development interests," said Ratnakar Adhikari, general secretary of SAWTEE on the occasion. The interaction was organised by Federation of Nepalese Chambers of Commerce and Industry (FNCCI), Forum for Protection of Public Interest (Pro Public), Garments Association of Nepal (GAN), Local Initiatives for Biodiversity Reserch and Development (Li-BIRD), Ministry of Commerce and supplies (MoCS), Society of Economic Journalists of Nepal (Sejon) and South Asia Watch on Trade, Economics and Environment (SAWTEE) here today.
Adhikari suggested vital changes in the draft to better clarify and make a frame work agreement for creating the most beneficial document. "We have to adopt a cautious approach and compare other such agreements between the US and other nations," he added.
SAWTEE chairman Dr Posh Raj Pandey also urged the government -- that is approaching the US for the finalisation of TIFA -- to be cautious as after TIFA, "Nepal will enter into a bilateral agreement with the US."
"Most of the South Asian countries have entered into such agreement with the US, except Bangladesh as it did not see any benefit for its garment sector," he said.
"The Nepali garment sector also will not get any benefit from TIFA if we enter into the agreement according to its original draft as the draft has not mentioned a single word about preferential market access or reducing tariff" said GAN vice-president Udaya Raj Pandey.

HAN unveils new logo, holds AGM

Hotel Association Nepal (HAN) has launched a new promotional logo coinciding with the Nepal Tourism Year (NTY) 2011 in a bid to give welcome boost to international tourists.
During the 40th annual general meeting of HAN in the capital today, Minister for Tourism & Civil Aviation Sarat Singh Bhandari has launched HAN's new promotional logo and souvenir. He expressed his confidence over the success of NTY 2011. "However, greater dedication is needed to achieve the target of NTY 2011 in bringing one million international tourists.
Presenting his paper titled 'Breaking into new markets with product innovation', Chairman of Tourism Malaysia Datuk Dr Victor Wee suggested that there should be close cooperation between the government and other tourism entrepreneurs for achieving the target of bringing one million tourists.
He also said that Nepal, as a tourist destination, needed to increase its access to different tourism markets and focus on the two most populated and fasted growing economies in the world -- India and China.
Wee said that the member states of the Association of Southeast Asian Nations (ASEAN) could also be major tourist generating markets for Nepal.
"This year, Asian tourists will lead growth in the global travel industry. Asian economies are rebounding faster from the global recession," he said, suggesting that the tourism sector must first scan the overall market, and identify, analyse, quantify and prioritise the relevant segments.
Citing an example of Malaysia, Wee said that NTOs could easily customize their promotions and products specifically for the market. "Nepal should concentrate its efforts on promoting pilgrimage, adventure, heritage, volunteer and nature-based tourism activities," he advised. "It is good for Nepal to embark on an awareness campaign early and make a mark on its target markets. This will give a lead time for travel agents and tour operators to develop their packages."
On the occasion, Yogendra Sakya, National Coordinator of NTY-201, presented a paper on "Bridging tourism through NTY-2011'.
Welcoming the participants, HAN president Prasidha Bahadur Panday, said the repeatedly emerging labour problems were one of the major obstacles to the growth of the tourism industry in Nepal.
He called for separate labour laws for the tourism industry to thrive to its full potentials. "The vulnerable tourism business would not grow in the absence of conducive environment, required infrastructures, policies and positive attitude," he added.

Thursday, March 25, 2010

Nepal-Bangladesh trade talk on May 2-5

Nepal and Bangladesh will hold a commerce secretary level meeting from May 2-4 in Dhaka.
"We have no special agenda apart from transit and trade issues," said Surya Silwal, joint secretary at the ministry of Commerce and Supplies (MoCS). "It's Bangladesh's turn to bring agenda this time."
The secretary level meeting will focus on further integration in sub-regional perspective and mutual recognition of each other's testing and standardisation certificates, according to reports in Bangladeshi newspapers. "Officials in the Ministry of Commerce (MoC) said the commerce secretaries of the two countries are expected to devise strategies for the implementation of the relevant clauses of joint communiqué, co-signed by the premiers of India and Bangladesh in New Delhi recently," they reported.
Dhaka had expressed its desire to give Nepal and Bhutan access to Mongla and Chittagong ports. However, it is more likely that the commerce secretary level meeting between Dhaka and New Delhi will be held before a similar meeting between Dhaka and Kathmandu.
Experts said that there are a number of issues in the proposed draft of the Nepal -Bangladesh transit deal. Bangladesh is moving to open a new land route to Nepal and offer it the use of its Mongla port for export of goods to a third country.
Dhaka has sent the draft of a deal to Kathmandu to activate a 1976 transit treaty that would allow landlocked Nepal the use of Mongla port in the Bay of Bengal. Nepal has so far been exporting its goods through Indian ports.
The volume of Bangladesh-Nepal bilateral trade is negligible. Bangladesh's exports to Nepal were worth only $8.1 million against imports amounting to $69 million in fiscal 2008-09. To increase the trade between the two South Asian countries smooth transit facilities have been a major concern.
"Our major concern is to increase volumn of trade between the two countries," Silwal said adding that transit abd trade are linked together.

Gold price drops but not enough

Gold price today dropped by only Rs 200 per tola (10.664 gram) to Rs 32,000 (Rs 27,435 per 10 gram) in the domestic market though in the international market it dropped by $16 per ounce.
"Due to scarcity in the domestic market, the price could not toe the international market line unlike earlier days," said Tej Ratna Shakya, president of Nepal Gold and Silver Dealers' Association (Negosida).
On Sunday -- the first day of trading in the domestic market -- the price of the precious yellow metal dropped by Rs 400 per tola -- despite the public holiday to mourn former Prime Minister Girija Prasad Koirala's demise -- due to decrease of $17 per ounce in the international market.
"On Sunday, in the international market gold price dropped by $17 per ounce forcing the domestic market to drop by Rs 400 per tola and today it dropped by $16 per ounce but the domestic market witnessed only a Rs 200 drop," he said adding that the ban on gold import has created a shortage in the market, keeping the price up.
Though it is not the season for gold but traders are feeling the scarcity of the precious yellow metal. "The little quantity of gold that is flowing to the Nepali market is from India due to the price difference," Shakya added.
"Gold in India -- in recent weeks -- is Rs 500 cheaper making a reverse flow unlike a month ago when gold used to be cheaper in Nepal due to the Indian budget," he said adding that the government, thus, must bring an import-export policy for gold.
The price of the precious yellow metal had dropped in the domestic market in accordance with the international price on Sunday to Rs 27,520 per 10 gram -- Rs 32,100 per tola -- and Rs 400 down a tola from Friday's closing of Rs 32,500.
Meanwhile, silver also closed lower at Rs 416 per 10 gram (Rs 485 per tola).
The international market has been witnessing a decrease in the prices of gold and silver this week.

Wednesday, March 24, 2010

Khimti hands over micro hydel project to village

The Norwegian ambassador to Nepal, Thor Gislesen, handed over a 635-kw mini hydropower plant, transmission and distribution system and other assets to the Khimti Rural Electric Cooperative (KREC) for Kirnetar people in Dolakha district today.
The cooperative was established in 2004 by Himal Power Ltd (HPL) during the implementation of its rural electrification and development projects 'Jhankre Rural Electrification and Development Project' (JREDP and JREDP II).
Tom E Solberg, general manager of Himal Power Ltd, congratulated the KREC board and management on the occasion and said that the management of Khimti Rural Electric Cooperative has the motivation, capacity and feeling of ownership to manage the electricity generation and maintain its assets in an efficient and sustainable manner.
The cooperative currently provides electricity to 4,600 households and a further 3,800 households will be connected after the ongoing KiND project is complete. One more mini hydro power plant is being constructed, taking the total capacity of the cooperative to just above 1 MW.
HPL is the owner of the Khimti I Hydropower Project -- so far the largest private sector power project and the first "Build, Own, Operate, Transfer" (BOOT) model in Nepal.
Khimti Rural Electric Cooperative is the first fully independent, democratically operated and locally managed rural electric cooperative in the country. It serves as an example for other power projects in Nepal. KREC is providing better lighting for children's study, better health care, improved living conditions, establishing of small industry and enterprises and access to modern communications. These benefits will reach over 40,000 people in the vicinity of the Khimti 1 project area.
HPL said it would like to thank the government of Norway for its continuous support in bringing electricity and development to the rural population in Nepal.

Tuesday, March 23, 2010

Developing economies need better policy

Taming volatile price shifts for crude oil and other raw materials that many developing countries export and depend on for economic growth will require a better mix of policies and market mechanisms by governments, producers, those involved in international financial and credit markets, and others, according to speakers at UNCTAD's inaugural Global Commodities Forum this morning.
UNCTAD Secretary-General Supachai Panitchpakdi, opening the two-day conference, said over 85 developing countries depend on commodities for more than 50 per cent of their export earnings. The commodities boom that began in 2002 after more than two decades of declining prices raised hopes that such nations could reinvest climbing profits into reducing poverty and diversifying their economies, he said -- but then the boom turned to bust as the global recession struck in 2008.
Prices are only now beginning to recover, Supachai said, and immense challenges remain for commodity-dependent countries seeking to meet the Millennium Development Goals and other poverty-reduction targets. In addition to seeking ways to increase stability in commodities markets, he said the Forum will highlight how countries -- both importers and exporters -- can limit their exposure to commodity price volatility and mitigate the detrimental effects of commodity price swings.
The Forum will also address other pressing issues in the sector, including recent developments in the extractive industries; investment in improving the productive capacities of the commodities sector; options for mitigating risks in commodities production and trade; commodity finance and related legal issues; and policy options for minerals and metals producers.
Jean Feyder, Ambassador of Luxembourg and President of UNCTAD's Trade and Development Board, told the meeting that the Forum, or GCF, is intended to provide a neutral, high-level platform for reaching a convergence of views on price volatility and other commodities issues. The relationship between commodities exports and prices and poverty reduction also must be discussed, he said.
Mohamed Saleh Al-Sada, Minister of State for Energy and Industry Affairs of Qatar, said the price of oil, despite the best efforts of the Organization of Petroleum Exporting Countries (OPEC) to stabilize it, had tripled to over US$ 145 per barrel in July 2008 and then had fallen to less than $40 per barrel six months later. Since then, prices had recovered to about $70-80 per barrel. Speculation in commodities markets had contributed to the price swings, and speculation thrives on uncertainty, he said. Transparency in production and pricing can reduce the opportunity for such exploitative practices. What is needed are prices high enough to provide for economic growth and ensure long-term investment to ensure future supplies. Disparities between oil and gas prices also need to be addressed, the Minister said.
Germanico Pinto, Minister of Non-Renewable Natural Resources of Ecuador, and President of OPEC, said petroleum markets are enduring a period of great uncertainty. The challenges are complex and international cooperation is vital, as the global economy, especially in the energy field, is thoroughly interconnected. Increased speculative activity has led to price fluctuations that do not reflect actual supply and demand, Pinto said. Any global energy dialogue must focus on security of energy demand and supply -- consumers must be certain that their needs for energy will be met, while producers must have sufficient certainty of demand that they can invest in harvesting future supply, he added.
Ali Mchumo, Managing Director of the Common Fund for Commodities (CFC), said the Fund now has 106 member countries, and its intent is to harvest stable development from commodities production and exports. The sector must be transformed to become a major contributor to poverty reduction. Many developing countries remain highly dependent on commodities exports, and hence are vulnerable to the price volatility that plagues the sector, he said. While using commodity exports for growth, such countries must eventually break away from their extreme dependence on the sector.
Richard H Jones, Deputy Executive Director of the International Energy Agency, said the agency was founded in 1974 in the immediate aftermath of the 1973 oil shock. Its main aim is to promote energy security, and its member countries maintain oil stockpiles so that supply can continue at times of uncertainty and disruption. Market transparency and openness are vital for taming uncertainty and limiting shifts in prices, he said, adding that the organization uses research and forecasts to help keep current situations clear and to give an indication of future supply and demand.
Marwa J Kisiri, Head of the Geneva office of the African, Caribbean and Pacific Group of States (ACP), said many ACP countries are highly dependent on commodity exports, and the long-term trend has been towards declining returns from the sector; supply-side constraints also hinder the growth prospects of such nations. A development perspective is vital if international efforts are to succeed in responding to the challenges facing commodity-dependent countries, he said, and a successful conclusion to the Doha "development round" of trade negotiations also is needed.
Pierre-Francois Unger, National Councillor and Head of the Department of Economy and Health of the Republic and State of Geneva, said a multi-disciplinary approach is needed for facing commodities problems, and Geneva , an international city, is a fitting location for the Forum. Geneva is one of the world's leading centres for commodities trading, especially oil trading, second only to London, Unger said.

Secondary market bled dry, govt unconcerned

Oversupply and low demand coupled with government apathy has bled the secondary market white over the last couple of months.
The secondary market index today lost 3.65 points to close at 469.17 points as all sub-groups performed poorly.
Among the listed companies, Everest Bank became the top loser as it lost Rs 82 per unit in today’s trading whereas groupwise, hydropower sub-group — that has only three hydropower companies under its belt — lost heavily.
Among the nine sub-groups, hydropower saw a whopping fall of 9.66 points to close at 729.58 points. Others sub-group declined by 8.22 points to 531.08 points and development bank sub-group dropped by 5.79 points to 491.98 — bringing the secondary market down.
Technically, the market has also seen loss of confidence of among the investors as they have been sustaining repeated shocks.
However, the bear will continue to dominate Nepse, according to the Securities Research Center and Services (SRCS) study.
“If Nepse starts gaining, the first resistance point comes at 509.69 points. Even if it crosses that, it will again face an important resistance point at 512.48 points,” said the centre that has projected the data based on the index of March 1, when Nepse index was at 497.86 points.
If the bearish trend continues, the first major support will be at 466.89 points. However, if Nepse crosses this level too, the next support level would be at 447.75 points, according technical analysis done by SRCS.
“Liquidity crunch also has hit the secondary market,” said Rabindra Bhattarai, a renowned market analyst and lecturer at Shanker Dev College.

NMB’s further public issue
KATHMANDU: The capital market is experiencing a new phenomenon — further public issue — for the first time in its history of over one-and-a-half decade. NMB Bank Ltd has floated further public issue for the first time. It has floated 7,15,000-unit of shares for the public at Rs 285 per unit — adding Rs 185 premium to the face value of Rs 100. The 25th commercial bank has floated the further public issue since last Friday.

Sebon union on warpath
KATHMANDU: Securities Board of Nepal (Sebon) — the regulatory authority of the capital market — is in trouble since last week due to the dispute between the union and Sebon’s chairman. The union closed the office of the chairman last week saying chairman Dr Soorbir Poudel was not serious about solving the problems of the secondary market. “From today all the departments of the Board have been padlocked,” said the union members.

Monday, March 22, 2010

Governor vows to solve liquidity crunch

Newly-appointed governor of Nepal Rastra Bank, the central bank, Dr Yubaraj Khatiwada thinks there is enough liquidity in the market, but added, "There seems to be some problem as cash is out of the banking system."
"The central bank will try to find the reasons why banks have failed to attract liquidity," said the 15th governor of the central bank after assuming office here today. He also urged entreprenuers not to advise the central bank how to use monetary tools. "Nepal Rastra Bank (NRB) itself competent enough to use those tools as and when necessary," said the governor who did his PhD in monetary economics from Delhi University in 1991. "The central bank will improve its efficiency and supervision capacity."
There has been a positive expansion of the banking system but still one-third of the population has no access to of the banking channels, he said adding that the price hike can be tamed.
The cabinet on Friday appointed Khatiwada the 15th governor of the central bank that had remained without a governor for almost two months after governor Vijaya Nath Bhattarai's retirement on January 31. Dr Khatiwada He was vice-chairman of National Planning Commission (NPC).
Khatiwada has to work hard to meet the challenges facing the economy that is not in a good shape since recent months. The challenges include not only the depleting forex reserve, negative Balance of Payment (BoP), double-digit inflation and exposure of financial instituions to riskier sectors but also implementating strict regulations and supervising the mushrooming financial institutions.
Although it might not be very hard for him to face these challenges as he has had a long career in the central bank and retired as executive director from the central bank only a year ago, Khatiwada sure has a long list of problems that needs his immediate attention.
In absence of a governor, the central bank has not been able to publish the mid-term evaluation of the Monetary Policy that needs a serious rethink.
The government had formed a committee to recommend names for a possible governor, according to the Nepal Rastra Bank Act. The committee recommended Dr Khatiwada, vice-chairman of National Planning commission (NPC), finance secretary Rameshwor Khanal and deputy governor Bir Bikram Rayamajhi.
Khatiwada was born in Taplejung on August 13, 1956. He did his Masters in economics in 1981 and Masters in public administration in 1984.
He started his career with Nepal Rastra Bank in 1983. He has also worked as economic adviser and member of the NPC. Khatiwada is also guest lecturer at Tribhuwan University, Purbanchal University and Kathmandu University.
He has worked for the improvement of sick industries, privatisation of public enterprises and fiscal reform committees. President for two terms of Nepal Management Association (MAN) Khatiwada has also worked in Mongolia, Bhutan, Afghanistan, Laos, Sri Lanka, Bangladesh and Vanuatu as a senior economist with UNDP.

Manandhar retires
KATHMANDU: Acting governor and deputy governor Krishna Bahadur Manandhar retires - after more than a three decade-long career with the central bank -- from Tuesday. He became acting governor after governor Vijaya Nath Bhattarai's retirement on January 31. Earlier also, he had been acting governor when the then governor Bhattarai had to face charges of corruption. There are two deputy governors at the central bank. After Manadhar;'s retirement, there will now be only one deputy governor -- Bir Bikram Rayamajhi.

Sunday, March 21, 2010

Gold price drops, tows international market

Gold price today dropped by Rs 400 per tola (11.664 gram) in the domestic market, though the market remained closed due to a state holiday to mourn former Prime Minister Girija Prasad Koirala's demise.
"The price of the precious yellow metal dropped in the domestic market in accordance with the international price," said Tej Ratna Shakya, president of Nepal Gold and Silver Dealers' Association (Negosida). Gold today priced at Rs 27520 per 10 gram -- Rs 32,100 per tola -- and Rs 400 down a tola from Friday's closing of Rs 32,500.
"The dollar gained in the international market pulling the gold price down," he added. In the international market, the price of the gold witnessed a fall of $17 per ounce. Shakya said that the domestic market fixed the price despite the public holday today "but there was no trading."
The local bullion market reacts immediately when there is a difference of $10 per ounce price in the international market.
Meanwhile, silver also lost Rs 4.50 per 10 gram today. On Friday, silver was traded at Rs 429 per 10 gram but today it was Rs 424.50 per 10 gram.
Gold last week closed at Rs 27,865 per 10 gram -- Rs 170 more than its opening price of Rs 27,695 per 10 gram last Sunday.
Silver last week opened at Rs 424.50 per 10 gram on Sunday but closed at Rs 429 per 10 gram last Friday.

Poor crops yield to pull growth rate down

The delayed monsoon and erratic distribution of rain caused a reduction in the 2009-10 summer crop production across the country, hitting major crops like paddy and maize.
"Paddy production reduced to 4.02 million metric tonnes (MT) and maize reduced to 1.86 million metric tonnes, pulling down the yield by 11 per cent and four per cent, respectively, compared with last year," said a report jointly published by the Ministry of Agriculture and Cooperatives (MoAC) Food Security Monitoring Unit and World Food Programme (WFP) Food Security Monitoring and Analysis Unit for the month of February.
"It is anticipated that the country will face a substantial food deficit during the current fiscal year despite the positive outlook for the current winter crop," it said.
In August 2009, MoAC estimated the edible cereal deficit to be 400,000 MT for the current fiscal year compared with the total requirement of 5.4 million MT. "This deficit represented the cereal requirement of seven per cent of the population though the figure will be revised after the winter harvest," according to the report.
The global food market situation is currently not favourable for Nepal. Natural disasters caused substantial regional summer crop losses in countries such as India and the Philippines, which resulted in an increase in the international price of important summer crops like rice. The international price will impact the domestic price though domestic food prices are currently stable at the higher-level. "During the year 2010, food prices will go up," the report said.
Mid-Nepal and Far-West hill and mountain regions were most affected by poor summer crop production and these districts also faced summer crop reduction by up to 30 to 50 per cent, resulting in a situation of high to severe food insecurity amongst the vulnerable population.
According to the IMF report, the macro-economic outlook also is challenging as the real GDP growth is expected to decelerate to three per cent in the current fiscal year due to weak monsoon apart from slowdown in remittance inflows and tighter monetary conditions.
According to the CBS data on sectorwise contribution to GDP, the Agriculture and Forestry sector contributed around 30-35 per cent to the total GDP. Thus, the poor crop yield is going to bring the gross domestic production (GDP) too down to around three per cent.

Saturday, March 20, 2010

Private sector loses its patron

Nepal lost the leader, who believed in democratic socialism, the role and capacity of private sector and the industrialisation of the country. Under late Girija Prasad Koirala's leadership during the early 90s, the country took major policy decisions that brought sweeping changes in the economy.
"The economy is surviving even today due to decisions that were taken under his leadership post-1990," according to former finance minister Dr Ram Sharan Mahat, who worked under him at different times and in different capacity.
Post-1990, the country not only saw multiparty democracy, the national economy also saw liberalisation. His government encouraged the private sector and the economy began to take off. Nepal implemented extensive reforms under his leadership to facilitate its integration with the global economy. Though the favourable initial effect of liberalisation on economic growth could not be sustained and inequality in distribution of income has continued to rise, the country saw many industries flourish post-1990.
Federation of Nepalese Chambers of Commerce and Industry (FNCCI) president Kush Kumar Joshi said that foreign investment policy was brought by Koirala's government. "He was instrumental in bringing a foreign investment policy," he said.
Joshi remembers Koirala as a leader who always lent his ear to the private sector. "He always reacted spontaniously when the private sector approached him for his help," he said adding, "Koirala always fought for democracy. His post-1990 movement established democracy and brought about economic liberalisation."
Binod Chaudhary, president of Confederation of Nepalese Industries, reminisced, "When late Koirala became the PM, I was FNCCI vice-president. He totally trusted us and relied on us as we worked closely with his government in transforming Nepal's economy from controlled to liberal. Tremendous changes took place then which resulted in higher-ever growth, close to nine per cent, doubling of exports and revenue.
"History will see him as a leader who played a crucial role in opening up the economy by supporting the private sector and taking the economy to an unprecedented height," he added.
Industrialist Rajendra Khetan thinks that the economic liberalisation policy brought by his government helped boost the private sector especially banking, insurance, airlines, telecom and the media.
"Nepal entered the modern economic era under his leadership," he added.
"Koirala ended the licence-Raj and liberalised the economy," remembers Diwakar Golchha. "He brought various policy changes during his tenure as Prime Minister," he said adding that Koirala played a key role in the Nepal-India Trade Treaty that opened the door for Indian investment in Nepal. "Koirala was serious about bringing about an economic revolution through industrialisation," Golchha said.
Brought up in the industrial capital of Nepal -- Biratnagar -- Girija Prasad Koirala knew how the economy worked and was aware of the importance of industrialisation.
"He had strong faith in the capacity of the private sector and under his leadership post-1990 Nepal saw sweeping changes in its economy," recalled Mahat.
It is no surprise then that a man, who started his political career from Biratnagar Jute Factory as a trade union leader in 1947-48, always stood for a market-oriented economy and social justice.
"To him, socialism meant roads where there were no roads, drinking water where there was no drinking water and employment where there was no employment," he said adding that Koirala gave subordinates a free hand in implementing liberal economic policies.
Though various political parties came to power, the successive governments after Koirala's government followed his policy of economic liberalisation. They all understood that Nepal should find a way of translating its integration with the global economy into higher growth and sustainable development by carrying out complementary policies to enhance supply elasticities and offset some of the adverse outcomes by cooperative action in partnership with its South Asian neighbours.

Industries closed
KATHMANDU: Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has decided to close all industries throughout the country on Sunday to honour late Girija Prasad Koirala. It also conveyed its condolences at the demise of former Prime Minister and Nepali Congress president Koirala. Issuing a press statement, the umbrella organisation of Nepali private sector said, "FNCCI will always remember late Koirala as the leader of historical revolutions -- the people's movement of 1990 and 2006 as well as his role as the father of market economy in Nepal. The Nepali private sector cannot forget his contribution to the peace process and liberalisation of the economy that led the country towards prosperity. The duty of promulgation of constitution and making Nepal a prosperous country has shifted to other leaders," it said.

Friday, March 19, 2010

Nepal-Israel sign agriculture cooperation agreement

Nepal and Israel have signed an agreement on cooperation in the field of agriculture.
Minister for Agriculture and Cooperatives Mrigendra Kumar Singh Yadav and minister for Agriculture and Rural Development of Israel Shalom Shimon signed the agreement on 'Cooperation in the Field of Agriculture ' on behalf of their respective governments on Wednesday.
Speaking during the signing ceremony and dinner hosted in honour of the Nepali minister and his delegation by Shimon in Jerusalem, Yadav expressed the hope that the agreement would pave the way for opportunities in the field wherein peoples of both countries would benefit.
He also sought the Israeli government's support for initiating active bilateral agriculture cooperation, particularly in technology transfer for mutual benefit. Yadav also called for greater and diversified interaction between at the professional as well as government levels of both the countries in the days ahead. Shimon said Israel has various kinds of agriculture systems based on high-technology as well as other proven systems and that it is very much optimistic about the outcome of the agreement and assured that his country is keen to promote agricultural cooperation with Nepal.
Yadav also met with other various senior officials including Israel's reputed agricultural entrepreneurs and industrialists and toured different locations of Israel to observe different agricultural sites, technology farms, and research and development stations including the high-tech based irrigation and farming system. During the course of its visit, the Nepalese delegation also held extensive interaction with Israeli agricultural researchers, producers, exporters, farmers as well as Nepali agriculture on-the-job-training students in Israel.
Earlier on Monday, the Nepali delegation held bilateral meetings with the Israeli government delegation led by Shimon. They discussed bilateral matters pertaining to agricultural cooperation, transfer of agricultural technology and exchange of visits on professional, academic as well as official levels. Nepal's ambassador to Israel Baijnath Thapalia Israel was also present during the meeting.
Yadav was in Israel on an official visit from March 14 to 18, leading a four- member Nepali delegation comprising National Planning Commission member Prof Subodh Narayan Jha, Joint Secretary at the ministry Dr Hari Dahal and Registrar at the Department of Cooperatives Maheshwor Sharma Paudel.
Yadav left Israel for Kathmandu today.

Cabinet appoints Dr Khatiwada as central bank governor and Mallick as PAF vice chairman

The cabinet on Friday appointed Dr Yubaraj Khatiwada as the governor of the central bank and Bidhyadhar Mallick as vice chairman of Poverty Alleviation Fund (PAF).
Khatiwada will be the 15th governor of Nepal Rastra Bank that has remained without a governor for almost two months, after former governor Vijaya Nath Bhattarai’s retirement on January 31.
In absence of governor, the central bank has not been able to publish mid-term analysis of the Monetary Policy — that needs a serious relook.
The central bank remained without a head as there was a serious rift among the ruling political parties on the appointment.
The current vice-chairman at the National Planning Commission, Khatiwada will have a challenge to contend with depleting forex reserves, negative balance of payment, rising inflation and exposure of the financial institutions to riskier sectors as the governor.
However, his long experience at the central bank will help him face the challenges. He has retired as an executive director from the central bank only a year ago.
The government had formed a committee headed by finance minister Surendra Pandey -- with former secretary Dr Bhola Chalise and Govind Bahadur Thapa -- to recommend the names for governor’s post, according to the Nepal Rastra Bank Act. The committee had recommended Dr Khatiwada, the vice-chairman of the National Planning commission, finance secretary Rameshwor Khanal and deputy governor Bir Bikram Rayamajhi.
Khatiwada began his career in Nepal Rastra Bank in 1983. He has also worked as an economic adviser and was a member of the NPC.
Khatiwada -- the PhD holder in monetary economics from Delhi University in 1991 -- was born in Taplejung on August 13, 1956. He did his masters in economics in 1981 and masters in public administration in 1984.
Kahatiwada, who started carier in Nepal Rastra Bank in 1983, has also worked as an economic adviser and was a member of the NPC. He is also guest lecturer of Tribhuwan University, Purbanchal University and Kathmandu University.
He has worked on improvement of poor industries, privatisation of public enterprises and fiscal reform committees. President for the two terms of Nepal Management Association (MAN) Khatiwada has also worked in Mongolia, Bhutan, Afghanistan, Laos, Sri-lanka, Bangladesh and Bhanuatu as a senior economist of UNDP.

Thursday, March 18, 2010

No currency devaluation: Finance Minister

Finance Minister Surendra Pandey rejected speculation about the devaluation of Nepali currency despite thinning foreign exchange reserves. "It is a rumour," he scoffed at a press meet organised at the ministry here today.
"Our foreign exchange reserves can accommodate import for seven months and there is no problematic situation," he said adding that the government is preparing export promotion programmes to increase foreign exchange reserves. "The Economic Activities Monitoring and Advisory Committee will draw up concrete programmes to boost export," he added.
FM Pandey assured that the government was ready to control excessive import. "The government decision to increase customs duty on gold is an instance," he said. The government has increased custom duty on gold earlier this week from Rs 130 per 10 gram to Rs 470 per 10 gram duty to stop illegal cross-border trade with India. However, still there is a difference of Rs 10 per 10 gram in Nepal's and India's duty even after revision.
Import of goods and services significantly increased this year compared to the previous year. There was an average monthly import of goods and services equal to Rs 17.43 billion in the fiscal year 2007-08 and which reached Rs 30.81 billion this year. Last year, the average monthly import was Rs 21.97 billion.
The great growth in import was fuelled by excessive import of gold this year. The country saw gold worth Rs 5.6 billion imported per month while the rate was Rs 1.46 billion a year ago. "If we can manage it, we can save Rs 4.14 billion monthly," he explained.
FM Pandey also voiced grave concern over the liquidity crunch. Deposit in banks and financial institutions is not increasing at the ratio of money in the market, he said. Growth of deposit in commercial banks decreased to four per cent this year from 13 per cent last year.
The government has identified irregularities in cooperatives and wants to regularize the sector. "The government and Nepal Rastra Bank (NRB) are exploring how the irregularities can be controlled," he said adding that the department of Cooperatives (DoC) has studied the financial position of 10 big cooperatives in Kathmandu Valley.
According to FM Pandey, low foreign exchange reserves occurred because of increased trade deficit and marginal growth in remittance. "We have two major challenges -- managing the liquidity crunch and maintaining the BoP at the earliest to ease the situation," he said.
The minister also expressed worry over increasing expenditure of the government. "Salary increment of civil servants, special security plan and the cholera out-break in the country's far-western region are major causes of increased expenditure," he said. However, the ministry will meet the revenue target, he added pointing out at the same time that revenue is not export-based that could propel economic activities in the country. Rather, it is an import-fuelled revenue growth that will not help the economy.
"The government is planning to present a supplementary budget in the Legislative Constituent Assembly to cope with the growing general expenditure," he said.
FM Pandey also voiced concern over the price rise and bearish capital market, though he has done nothing to curb inflation and boost the confidence of investors. Inflation here is at 12 per cent in first seven months of the current fiscal year contrary to MoF's projection of seven per cent.

Wednesday, March 17, 2010

Moon for quickening MDG pace

With only five years left for the 2015 deadline to achieve Millennium Development Goals (MDGs), UN Secretary-General Ban Ki-moon is calling for the adoption of global action agenda for accelerating progress towards the goals.
"We must not fail the billions who look to the international community to fulfil the promise of the Millennium Declaration for a better world. Let us meet in September to keep the promise," Ban said in his report, Keeping the Promise, issued today.
The report -- which will serve as a basis for government deliberations on an action-oriented outcome document for the September 20-22 summit on the MDGs -- identifies success factors and lessons learnt, highlights gaps, emerging challenges and opportunities, and lays out specific recommendations for action to boost progress towards the goals over the remaining five years. Additional reports are expected, including the statistical appendix to the Secretary-General's report, in April; the latest official statistics on progress towards meeting the goals, in late June; and a more in-depth assessment of gaps in international cooperation, by early September.
"Our world possesses the knowledge and the resources to achieve the MDGs," Ban said in the report, referring to the targets based on the 2000 Millennium Declaration, aimed at greatly reducing poverty, hunger, disease, maternal and child deaths and other ills by 2015.
Falling short of the goals "would be an unacceptable failure, moral and practical," the Secretary-General said. "If we fail, the dangers in the world -- instability, violence, epidemic diseases, environmental degradation, runaway population growth -- will all be multiplied."
A number of countries have achieved major successes in combating extreme poverty and hunger, improving school enrolment and child health, expanding access to clean water, strengthening control of malaria, tuberculosis and neglected tropical diseases, and providing increased access to HIV treatment, the report points out.
These successes have taken place in some of the poorest countries, demonstrating that the MDGs are indeed achievable with the right policies, adequate levels of investment, and international support.
Yet progress has been uneven and -- without additional efforts -- several goals are likely to be missed in many countries, according to the report. The challenges are most severe in the least developed countries, land-locked developing countries, some small island developing states, those vulnerable to natural hazards, and countries in or emerging from conflict.
The shortfalls in progress towards the MDGs are not because they are unreachable, or because the time is too short, the report states, but rather because of unmet commitments, inadequate resources and lack of focus and accountability. This has resulted in failure to deliver on the finance, services, technical support and partnerships needed. As a consequence of these shortfalls, improvements in the lives of the poor have been unacceptably slow, while some hard won gains are being eroded by the food and economic crises.
Nearly ten years into the global effort to achieve the MDGs, the report identifies a number of key lessons learnt. Among them, the most important is the national ownership of development strategies. Successful countries pursued pragmatic policy mixes, with enhanced domestic capacities. International cooperation should more strongly support such national development strategies and domestic capacity-building efforts.

Maoist, UML unions bid to shut Gokarna resort

Two trade unions of Gokarna Forest Resort — one affiliated to UCPN (Maoist) and the other owing allegiance to CPN (UML) — today created obstacles in the operation of the resort and plan to shut it down if their demands were not met.
"The unions did not let us operate the generator during load shedding hours," said Suman Sachdev, director of the resort. He also blamed the central trade unions for encouraging the local unions to create disturbances in the resort, as according to him it could gain them "political clout". "Otherwise, why would they create trouble," asked the angry director of the Singapore-based company that has invested over Rs 1,000 million in Nepal and is providing 230 permanent and 150 temporary jobs.
The unions have been demanding 40 per cent raise in the basic salary and 100 per cent raise in dearness allowance, which is against the agreement reached between the Hotel Association of Nepal and six central trade unions affiliated to the political parties, including UCPN-M and UML. They had agreed not to strike for the raise.
"The agreement validated by the Supreme Court has to be respected," Sachdev said, adding that the local unions — at the behest of central unions — put illegal banner at the gate of the resort. "After repeated requests, they did not honour the agreement reached between the HAN and the six central trade unions, we wanted the labour department to intervene and sort out the matter," he added. "But the labour department and the ministry did nothing to help operate the resort smoothly," Sachdev said.
The resort management and unions held discussions today in the presence of Director General of the Labour Department. "Following today’s discussions, the DG said he was helpless as the unions were too aggressive," he said, adding that if by tomorrow noon, the matter was not sorted out the management would move the guests to another place.
Ramesh Pant, president of All Nepal Hotel and Restaurant Workers’ Union — the UCPN-M affiliated trade union that looks after hotels and restaurants — said they were ready to sit for another round of talks tomorrow.
"There will be a tri-partite meeting tomorrow," he said, adding that the agreement between the HAN and trade unions has expired. However, HAN executive director Madhav Ohm Shrestha said the association stood by the agreement between HAN and trade unions.

Tuesday, March 16, 2010

SAFE to organise third conference

South Asian Federation of Exchanges (SAFE) is holding the third edition of its flagship conference 'South Asian Capital Markets Conference-2010' in Mauritius on April 22-25.
The conference is being jointly organised by SAFE with the support of the Global Board of Trade (GBOT) Mauritius, MCX-SX-India's new stock exchange, the Stock Exchange of Mauritius Ltd and with Knowledge Partners; Financial Technologies Knowledge Management Co (FTKMC).
The SAFE conference is being held in the perspective of growing international recognition of South Asia and adjoining countries as a region of rapid growth and development. The rapid growth of economy and finance in India, the potential of consistent development in Pakistan, the economic dividend that Sri Lanka is likely to experience in the wake of its recent victory against the separatists, the inclusive growth approach of Bangladesh, and the emerging prospects for developments in economies like Nepal, Maldives and Bhutan; make the South Asian region a great prospect and promise for international investing community.
The South Asian region attracted nearly $20 billion in portfolio flows into stock markets, making it one of the most favoured destinations in the emerging markets, according to the data. With global and domestic policy working towards greater harmony and stability in the region, South Asia is expected to have an accelerated growth of financial markets and also engage a larger per cent of the population in the financial market activity.
The conference is being designed with the theme 'Expanding Asset Classes: South Asia'. It is expected to be attended by a galaxy of CEOs and heads of various corporates, banks, and financial institutions in South Asia and other regions, with technical sessions engaging in cutting-edge discussions on critical aspects of deepening of the South Asian Financial Markets.
The SAFE -- also called South Asian Dow Jones -- is an initiative towards regional and global integration of the regional capital markets. It's a non-profit association fashioned under the umbrella of SAARC to endorse the growth of securities market in the region. The existence of SAFE is truly a milestone towards an integrated and amalgamated South Asian securities market with a common objective of development and affluence of the capital markets' stakeholders in and outside the region.
SAFE has in April reviewed list of South Dow Jones SAFE 100 Index that is developed by Dow Jones for South Asian Federation of Exchanges -- a SAARC recognised forum of 23 stock exchanges and other capital markets institutions from eight South Asian countries and the UAE.
Dow Jones SAFE 100 Index has revised the South Asian index delisting nine Indian companies and eight Pakistani companies. Bajaj Holdings Ltd, HCL Technologies Ltd, Hindalco Industries Ltd, Jaiprakash Associates Ltd, Mahindra & Mahindra Ltd, Siemens India Ltd, Suzlon Energy Ltd, Tata Motors Ltd and Unitech Ltd are the Indian companies dropped from the index.
Pakistani companies delisted are Adamjee Insurance Co Ltd, Askari Bank Ltd, Bank of Punjab, DG Khan Cement Co Ltd, Faysal Bank Ltd, Indus Motor Co Ltd, Nishat Mills Ltd and Pak Suzuki Motor Co Ltd.
These 17 companies have been replaced by an equal number of companies --- six from Bangladesh, nine from India and two from Pakistan --- in the Dow Jones SAFE 100 Index.
According to SAFE, Dow Jones SAFE 100 Index represents the collective movement, direction and trend of regional stock markets and would enable global investors to use the same as a benchmark for the performance of their investments in the region. The index would also promote the region as an important asset class in the investment portfolio of the regional and international fund managers.
In Europe, there is Federation of European Securities Exchanges (FESE) that represents 42 Securities Exchanges (in equities, bonds, and derivatives) through 23 Full Members from all EU Member States and Iceland, Norway and Switzerland as well as 7 Corresponding Members from European emerging markets.
FESE is one of the founding members of the European Capital Markets Institute (ECMI) and is a member of the European Corporate Governance Institute (ECGI). Through its members' activities on a global scale, FESE enjoys links with the regulatory community and industry from around the world and works closely with the European Association of Central Counterparty Clearing Houses (EACH) and European Central Securities Depositries Association (ECSDA) in particular in the context of the Code of Conduct on Clearing and Settlement.
In Africa there is African Securities Exchanges Association (ASEA) that is a non-profit company limited by guarantee that was found in Kenya in November of 1993, according to Chapter 486 of the Laws of Kenya, with the aim of establishing systematic mutual cooperation and exchange of information among its members.
The association started with Nairobi Stock Exchange as the first member in 1993, followed by Mauritius, Uganda and Dar-es-Salam Stock Exchanges in the 90's. The association is currently represented by 20 exchanges in 27 African countries.

Sunday, March 14, 2010

PrimeLife primary issue oversubscribed by ten times

PrimeLife Insurance Company's initial public offerings (IPOs) has been oversubscribed by 10 times. "We floated shares worth Rs 108 million and have received 1,31,607 applications worth Rs 1.872 billion," said Resta Jha, chief executive officer (CEO) of the insurance company. "It's over 10 times the requisition."
PrimeLife Insurance floated its public issue on March 9 and closed on March 12. It issued 10,80,000 units of ordinary shares with a face value of Rs 100 per unit. The insurance company has appointed NIDC Capital Market the issue manager for the IPO worth Rs 108 million.
"Investors have reposed great faith in our company," he said adding that at a time of liquidity crunch too, they received such an overwhelming response to their primary issue. "It shows that the investors have gone through our books that show a net profit of Rs 56.7 million -- after tax -- in its first year of operations itself."
The insurance company has so far issued 18,9000 policies and collected Rs 520 million worth of premium. After the current issue, the company will have a paid-up capital of Rs 360 million.
According to Beema Samiti's (Insurance Board) rule, insurance companies have to increase their paid-up capital to Rs 500 million by 2070 BS. "So, our company plans to give bonus shares worth Rs 140 million to increase its paid-up capital to Rs 500 million from the present Rs 360 million to fulfil the Beema Samiti regulation," Jha said adding that the company has been performing better and is in a condition to give good returns to its investors.
A week ago, Surya Life Insurance had also floated 10,80,000-unit of ordinary shares with a face value of Rs 100 per unit worth Rs 108 million and its shares were oversubscribed by around five times. Manakamana Development Bank also floated Rs 300 million worth shares and its primary issue too was oversubscribed by around five times.
The liquidity crunch had hit 'slightly' earlier two issues of Surya Life Insurance and Manakamana Development Bank. Investors lost confidence in the capital market recently also due to the bearish secondary market.
Next month, Agriculture Development Bank Ltd (ADBL) is floating the largest ever Initial Public Offering (IPO) in the banking history of Nepal.
After 38 years of its inception, it has got licence as an A-class bank from Nepal Rastra Bank (NRB). Now, ADBL has decided to go public with Rs 960 million worth ordinary shares from April 4. Ace Development Bank has been appointed the sales and issue manager. ADBL had registered Rs 1.72 billion profit before tax in the last fiscal year.

NOC hikes petrol price by Rs 2.50; diesel, kerosene prices by Rs 2

Nepal Oil Corporation (NOC) today hiked petrol, diesel and kerosene prices.
"Petrol will now cost Rs 80 per litre -- dearer by Rs 2.50 -- and diesel and kerosene will now cost Rs 61 per litre -- Rs 2 dearer -- in Kathmandu Valley," said the NOC.
However, consumers have to pay a little more as Nepal Petroleum Dealers' Association (NPDA) that distributes petroleum products throughout the country always sells petroleum products after adding costs. It raised the price to stop the back flow of the petroleum products to India as there has been price difference in between Indian and Nepali markets.
The state oil monopoly has not changed the price of cooking gas, that according to the corporation, is making loss. LPG -- popularly known as cooking gas -- costs Rs 1250 per cylinder.
NOC has also not changed the Aviation Turbine Fuel (duty paid) that it is selling at Rs 75 per litre and ATF (bonded) that it is selling at $805 per 1,000 litre.
Earlier, on February 18, NOC increased the price of kerosene and diesel each by a rupee per litre making them Rs 59 per litre in the Valley. But the price in Tarai districts was increased to Rs 57.70 per litre only.
NOC had then also decided to increase the price as, according to it, the sole supplier of petroleum products had been incurring losses in both diesel and kerosene that is the poor men's fuel.
The state-owned petroleum importer had been -- after the price hike -- raking in a profit of Rs 20 million a month against its loss of Rs 37.5 million per month
NOC has been adjusting prices of petroleum products every month as since last year prices started fluctuating, pushing the state-owned corporation into the red.
Earlier, it had increased the price of kerosene and diesel by Rs 3 per litre on November 17. Then, both kerosene and diesel prices were hiked to Rs 58 per litre. NOC used to make a profit of Rs 4 on a litre of kerosene after the hike, while it incurred a loss of Rs 2.50 on a litre of diesel.
NOC had started making profit when the downward revision of prices started in October 2008, which continued till March. But the rise in prices of petroleum products in the international market again brought it to its knees.
Every month -- on 16th as per the Roman calendar -- NOC receives a new price list for petrol, diesel from the IOC -- its sole supplier. However, on the first of every month, it receives a new price list for petrol, diesel, kerosene, Air Turbine Fuel (ATF) and cooking gas.

Friday, March 12, 2010

Central bank paints bleak economic picture

Nepal Rastra Bank has painted a bleak picture of the economy as according to its report the overall Balance of Payment (BoP) recorded a deficit, gross foreign exchange reserves dropped and exports declined in the first six months of the current fiscal year.
The liquid assets of commercial banks had grown by 8.8 per cent amounting to Rs 164.4 billion till mid-January 2009 but declined by 12.3 per cent from mid-July 2009 amounting to Rs 188.1 billion till mid-January 2010 amounting Rs 164.9 billion ????, said the central bank in current macroeconomic situation -- based on the first six months' data for the current fiscal year published here today.
"Of the components of liquid assets, liquid fund declined by 13.1 per cent. A decline in commercial banks balance with the Nepal Rastra Bank (NRB) and that held abroad led to such a reduction in liquid fund of commercial banks," said the central bank.
The balance held abroad by commercial banks declined by Rs 5.1 billion to Rs 48.3 billion ????, and the balance with NRB declined by Rs 11.6 billion. Similarly, investments on government securities declined by 11 per cent (Rs 7.9 billion).
The higher expansion of loan and advances relative to the deposit mobilisation led to a change in the portfolio of commercial banks. "Loans and advances of commercial banks increased by 11.5 per cent (Rs 59.5 billion)," NRB said adding that the higher expansion of loan and advances relative to deposit mobilisation of commercial banks increased the credit-deposit ratio to 89.3 per cent in mid-January 2010 from 81.2 per cent in mid-July 2009. "On the other hand, the liquidity-deposit ratio declined to 28.6 percent in mid-January 2010 from 34.2 per cent in mid-July 2009."
However, NRB injected net liquidity amounting to Rs 34.9 billion. During the period, Rs 7.4 billion and Rs 1 billion was mopped up through outright auction and reverse repo auction, respectively while Rs 40 billion and Rs 3.4 billion were injected through repo and outright purchase auction, respectively. In the same period last year, liquidity amounting to Rs 20.7 billion was mopped up.
"We injected net liquidity amounting to Rs 37.6 billion through net purchase of $494.8 million from commercial banks. A net liquidity of Rs 73.2 billion was injected through the net purchase of $963.6 million in the same period last year," NRB said.
NRB purchased Indian currency worth Rs 49.8 billion through the sale of $1.1 billion in the Indian money market during the review period. Indian currency equal to Rs 33.9 billion was purchased through the sale of $720 million in the corresponding period the previous year. "An accelerated trade deficit with India contributed to such a high volume of Indian currency purchase," the central bank said.
"The overall BoP recorded a deficit of Rs 19.79 billion, contrary to a surplus of Rs 28.53 billion in the same period last year," the central bank said. "Gross foreign exchange reserves dropped by 14 per cent to Rs 240.83 billion from a level of Rs 279.99 billion as at mid-July 2009."
Though government budget surplus stood at Rs 10.16 billion compared to a surplus of Rs 7.42 billion in the same period last year, total government spending increased by 31.8 per cent to Rs 86.29 billion compared to an increase of 12.3 per cent in the corresponding period the previous year. The development expenses also went up almost three-fold by 31.8 per cent to Rs 86.29 billion compared to an increase of 12.3 per cent in the same period last year. Also, recurrent expenditure increased over three-fold by 40.2 per cent to Rs 60.64 billion against last year's corresponding period which saw an increase of 13.1 per cent.
Due to government apathy and incompetence, exports declined by 12.1 per cent -- contrary to a growth of 22.3 per cent in the same period last year. "Exports to India dropped by four per cent against a growth of 1.3 per cent and exports to other countries decelerated by a whopping 23 per cent contrary to a growth of 70.5 per cent in the same period last year," said the central bank.

Thursday, March 11, 2010

Nepse starts trading from Narayangadh

Nepal Stock Exchange Ltd (Nepse) has started share trading from Narayangadh from today -- making it a third city outside the Kathmandu Valley to start share trading.
The centralised-Nepse has started expanding its service from the begining of March. On march it started share trading from Pokhara and on March 4, it started trading from Biratnagar through Remote Work Station (RWS).
"Trishul Securities and Investment Pvt Ltd started share trading from Narayangadh from today," said Nepse.
"Premier Securities has also started share trading from Pokhara from today." It is the second broker after Nepal Stock House to start trading from Pokhara.
Nepal Investment and Securities Trading, and Pragyan Securities have been trading since last week from Biratnagar.
The Kathmandu-based secondary market has started diversifying its trading from different districts after it was automated. Investors outside Kathmandu Valley have long been asking Nepse to create a mechanism so that they could take part in share trading from their cities.
"The expansion of the secondary market will help expand the capital market too as it will increase the number of investors and market capitalisation," said Nepse.
In the first phase, Nepse will start transactions in districts where there is optical fiber connection.
Nepse -- in coordination with the securities brokers' association -- has planned to start share trading through remote work stations (RWS) in Birgunj, Narayangarh, Butwal and Nepalgunj. Three brokers from Nepalgunj and four brokers each from Biratnagar, Birgunj, Narayangadh are ready to start share trading from their cities.

ADB grants loan to Nepal for power

Asian Development Bank (ADB) has agreed to provide a loan assistance of Rs 4714 million and a grant assistance of Rs 326 million totaling about Rs 5,040 million to the government for the implementation of Energy Access and Effiecncey Improvement Project.
The agreements to this effect were signed between the government and the ADB at the Ministry of Finance today. The agreement was signed by Rameshwore Prasad Khanal, finance secretary and Barry Hitchcock country director, ADB Kathmandu on behalf of their respective institutions.
The project consists of three main categories that is Energy Access, Clean Energy and Capacity Building with seven components facilitating access to clean energy, energy access, quality enhancement, clean energy improvement, Supply side energy efficiency improvement, energy efficiency in lightening, renewable energy for street light and capacity building. The major project activators include construction of middle Marshyangdi-Damauli-Marshyangdi TL, construction of second circuit of BUtwal - Kohalpur TL, construction and expansion of Chapali and Matatirtha grid sub stations, installation of capacitor banks, construction of primary distribution sub stations and switching stations. Similarly rehabilitation of two small scale hydropower plants, distribution of about one million CFLSs, installation of 1000 solar and solar winds streetlights, and providing expert services to Nepal Electricity Authority (NEA).
This project will support the government long term vision to provide universal coverage using grid based and off grid supplies by 2027. It is hoped that the proposed loan and grant assistances will address the urgent needs attributed to the electricity supply crisis in Nepal, to a large extent. IN the short term the transmission network strengthening will add capacity by increasing evacuation of power from hydropower stations in the mid western region and allow increased energy imports across the eastern border and in the medium term, it will allow cross border energy trade. Moreover, the project will also lead to improve the financial performance of NEA. The NEA is the implementing agency and the project is expected to be completed by September 30, 2014.
In the mean time, the project agreements related to the project were also signed by Jivendra Jha, managing director NEA and Barry Hitchcock country director, ADB, Kathmandu.

Price starts looking up

Price hike has become a serious concern as it has not seen cooling down.
According to the central bank, the year on year (y-o-y) inflation -- as measured by the consumer price index -- recorded an increase of 12 per cent in Mid-February (seventh month of the current fiscal year) compared with the 13.7 per cent increase in the same period last year. It had recorded 11.8 per cent increase in mid-January (sixth month of the current fiscal year).
Propelled by the items in the food and beverage group, price indices of sugar and sugar related products -- that saw almost double and the highest increase of 77.6 per cent compared with an increase of 46.7 per cent in the same period last year -- the price hike continued to look upward, said the Nepal Rastra Bank (NRB).
Similarly, some of the items saw four fold increase in a year. "The price indices of spices, pulses, meat, fish and eggs as well as vegetables and fruits sub-groups increased in reviewed period by 36.7 per cent, 36.4 per cent, 22.7 per cent and 18.8 per cent respectively compared to an increase of 9.4 per cent, 26.5 per cent, 22.9 per cent and 19.4 per cent in the same period last year," the report added.
However, the grains and cereal products prices came a little down. "The index of grains and cereal products subgroup also witnessed an increment of 13 per cent compared to 14.7 per cent increase in the corresponding period of last year," according to the central bank's monthly price index. "Similarly, the price index of food and beverages group increased by 17.8 per cent whereas the index of non-food and services group rose only by 5.3 per cent. The index of food and beverages and non-food and services group had risen by 18.1 per cent and 9.1 per cent respectively in the same period last year."
Region-wise, the price index of Hills rose by 13 per cent and followed by 12.3 per cent in Terai and 10.8 per cent in Kathmandu Valley compared with 13.2 per cent, 13.8 per cent and 13.9 per cent same period last year.
Though the y-o-y wholesale price inflation increased by 14.2 per cent compared to 15 per cent a year ago, the indices of agricultural commodities and domestic manufactured commodities increased by 25 per cent and 11.2 per cent against to 18.8 per cent and 11.2 per cent a year ago. "Within the agricultural commodities group, the price index of pulses, livestock production and spices increased by 36.4 per cent, 35.2 per cent and 33.8 per cent compared with an increase of 19 per cent, 24 per cent and 10.3 per cent during the same period last year," it said.
Surprisingly, the price index of imported commodities declined by 0.5 per cent in the review period whereas it had increased by 11.8 per cent during the same period of last year.
Within the group of domestic manufactured commodities, the price index of food-related products increased by 18.9 per cent compared with a rise of 11.8 per cent a year ago.
However, the overall y-o-y salary and wage rate index rose by 16.7 per cent compared with a rise of 16.5 per cent a year ago. Similarly, the wage rate index also increased by 17.6 per cent compared with an increase of 16.4 per cent in the same period last year.
The wages of industrial labour increased by almost double. "Wages of agricultural, industrial and construction laborers increased by 20.7 per cent, 13.8 per cent and 12.9 per cent respectively in the review period. These wage rates had increased by 23 per cent, seven per cent and 15.3 per cent respectively in the same period last year," said the central bank.

The rising trend
Seventh month -- 12 per cent
Sixth Month -- 11.8 per cent
Fifth Month -- 11.3 per cent
First six months average -- 10.1 per cent.
Government target -- seven per cent

Monday, March 8, 2010

IMF paints bleak economic picture

The International Monetary Fund (IMF) -- apart from painting a bleak picture of the economy and lowering the real GDP growth to three per cent -- has cautiously warned against the rising risks in the domestic financial sector.
Though, the mission welcomed the central bank's recent directives on credit-to-deposit ratios, loan to value ratios, curb on real estate exposure, and reintroduction of Statutory Liquidity ratio (SLR), it also warned that risks in the financial sector have been building up and need to be addressed urgently.
"The financial system needs to adapt to an environment of slower growth and is likely to see deteriorating asset quality," suggested the mission concluding its Article IV Consultation discussion visit here today. "Appointing a new governor, who can provide strong and stable leadership for the central bank is urgent," said Laura Papi, the team leader of the IMF mission that blamed the accomodative monetary policy, weak supervision, and proliferation of financial institutions for rapidly increase in asset prices and overextension of banks.
"The macro-economic outlook is challenging," the mission said adding that after expanding by 4.7 per cent in the fiscal year 2008-09, the real GDP growth is expected to decelerate to three per cent in the current fiscal year due to poor monsoon, slowdown in remittance inflows and tighter monetary conditions.
Macroeconomic stability has been maintained in past years but the global crisis is having delayed impact on domestic economy and exposing its structural weakness, according to the mission. "However, Nepal wil recover from 2010-11," she added.
"High remittance has resulted in rising forex reserves despite lacklustre export performances, but the slowdown in the remittance inflow and rising imports have hit the forex reserve significantly in the recent months. Though the reserve has stabilised in recent weeks, the situation still remains fragile," the Fund warned.
It has also projected the current account deficit to about two per cent of GDP due to slowdown in remittance inflow and exports contraction.
"Revenue collection has been impressive in the past few years but expenditure should be oriented more towards investement that requires enhancing implementation capacity," it hsa suggested.
The interest rates needs to be maintained above those prevalling in India and the Nepal Rastra Bank (NRB) liquidity management needs to be be strenghtened, the Fund said. "When a general liquidity injection is not needed for the system, liquidity provision to sound individual banks with liquidity shortages should take place at present rates or at the bank rate under heightened supervision."
The team has, however, also suggested the government to tackle structural problems to achieve higher growth. "While Nepal's potential is high, progress is required in addressing the poor business climate, power shortage, infrastructural needs, weak governance and difficult labour relations apart from political stability and improved security."

Sunday, March 7, 2010

Remittance likely to slow down

The visiting International Monetary Fund (IMF) team has suggested adaptations in the economy as remittance rate is going to slow down.
Though remittance has buoyed the Nepali economy and reduced poverty, led to high credit growth, financed high imports while boosting forex reserves and played a major overall role in the economy, the current slowdown may give the government an opportunity to think about fixing the structural impediments, according to IMF's study on 'Remittance in Nepal and South Asia'.
The remittance inflow has seen a dramatic rise during the past couple of years. However, it has started slowing down since the begining of the current fiscal year. "Gross outflow of workers has helped remittance inflow to surge dramatically," said the report.
But the crisis in host countries like Malaysia and the Gulf -- where there is a major concentration of Nepali migrant workers -- has pulled down the number of migrant workers' outflow hitting remittance that has become an intregal part of Nepali economy.
"The remittance growth will continue but at a slower pace of around 10 per cent," said the study. "The slowdown of remittance will have an impact on the economy and it might also hit the financial system as it is more dependent on remittance."

Yet, it could be an opportunity to fix the domestic economic problems. "It may help focus minds on economy," said Laura Papi, IMF's Asia-Pacific region deputy director.
The drop in remittance growth will certainly have impact on consumption, imports and the financial system, according to the IMF study. "It will also have an indirect impact like drop in tax revenue due to low import," it said.
But, the drop in remittance inflow has helped push long overdue interest rates up, according to Papi -- the team leader of IMF Article IV Consultation team that is in Nepal since last week as part of its regular visits.
The successive IMF Article IV Consultation team has been suggesting the interest rates be raised to match the rates in India. However, financial institutions have never lent them an ear. They have started offering high interest rates in recent months due to liquidity crunch, partly fuelled by the drop in remittance.

Saturday, March 6, 2010

Hong Kong ranked Asia's most innovative economy

Hong Kong has Asia's most innovative economy, thanks to its high level of creativity and well developed financial markets, a study said.
The Chinese territory beat regional rival Singapore, which was in second place in the Asian rankings, said the joint study by international business school INSEAD and the Confederation of Indian Industry released late on Thursday.
Worldwide, Hong Kong ranked third in the Global Innovation Index while Singapore placed seventh, the study showed.
Among the criteria used by the survey, economies were ranked by patents filed, publication of scientific journals, research and development spending and how innovation supported social welfare, competitiveness and growth.
Hong Kong, Singapore and New Zealand were the only Asia Pacific economies to make it to the top 10 in the global rankings.
Iceland topped the global innovation list despite its deep economic woes followed by Sweden, while Switzerland placed fourth after Hong Kong.
Rounding up the global top 10 list was Denmark in fifth spot, followed by Finland, Singapore, Netherlands, New Zealand and Norway.
The US, which took the top spot last year, slid down to 11th place amid growing challenges from other countries which are putting increasing emphasis on education, science and technology, the study said.
The study stressed innovation as a key driver of growth, playing "a critical role not only in facilitating countries' recovery but also in sustaining national competitiveness," it said. "National and business leaders are struggling to balance the near-term needs of survival with the long-term demand to find new sources of growth."
This year's Global Innovation Index Report covered 132 economies that account for 96 percent of the world's gross domestic product.
Japan, Asia's largest economy, ranked 13th in the index and South Korea was seven notches below at 20th spot. Australia was in 18th place.
Taiwan placed 25th and China, widely expected to overtake Japan as the world's second biggest economy, placed 43rd on the global index.
The study said China scored high marks when it came to scientific output as the government supported various moves to boost research and development, but the country was weak in creativity and market sophistication. AFP

Thursday, March 4, 2010

Nepse starts trading from Biratnagar

Investors based in Biratnagar, rejoice!
Nepal Stock Exchange Ltd (Nepse) has started share trading from Biratnagar from today. Nepal Investment and Securities traded 350 units of shares for Rs 7,73,000 today -- the first day -- in four transactions from Biratnagar through Remote Work Station (RWS), said Nepse.
After Pokhara, Biratnagar has become the second city outside the valley to have started share trading, breaking away from the centralised system.
The Kathmandu-based secondary market has started diversifying its trading from different districts after it was automated. Investors outside Kathmandu Valley have long been asking Nepse to create a mechanism so that they could take part in share trading from their cities.
Nepal Stock House of Pokhara, that registered four transactions of three companies' 140 units of shares worth Rs 1,92,360 on March 1, today registered 23 transactions of 2,863 units of shares for Rs 1.52 million. "The expansion of the secondary market will help expand the capital market too as it will increase the number of investors and market capitalisation," said Nepse.
In the first phase, Nepse will start transactions in districts where there is optical fiber connection.
Premier Securities from Pokhara and Nepal Investment and Securities and Pragyan Securities from Biratnagar have got licences to start transactions from their respective districts.
Nepse -- in coordination with the securities brokers' association -- has planned to start share trading through remote work stations (RWS) in Birgunj, Narayangarh, Butwal and Nepalgunj.
Three brokers from Nepalgunj and four brokers each from Biratnagar, Birgunj, Narayangadh are ready to start share trading from their cities.

Tuesday, March 2, 2010

Nepal, Bangladesh trade talks by March end

The commerce secretaries of Bangladesh and Nepal will hold a two-day meeting in Dhaka on March 30 to facilitate bilateral trade and establish connectivity between the two countries under a proposed transit deal.
The meeting will focus on further integration in sub-regional perspectives and mutual recognition of each other's testing and standardisation certificates, according to experts.
Officials at Bangladesh's Ministry of Commerce (MoC) said the commerce secretaries of the two countries are expected to devise a strategy for the implementation of relevant clauses of the joint communiqué, signed by the premiers of India and Bangladesh at New Delhi in January.
A joint communiqué, co-signed by Indian Prime Minister Dr Manmohan Singh and his Bangladeshi counterpart Sheikh Hasina has assured of giving Nepal and Bhutan access to Mongla and Chittagong ports.

The prime ministers -- in the joint communiqué -- also agreed that Rohanpur-Singabad broad gauge railway link would be available for transit to Nepal.
"The upcoming secretary level meeting between Dhaka and Kathmandu will pave the way for implementation of commitments made by Prime Minister Sheikh Hasina during her recent visit to New Delhi to boost the sub-regional integration on both trade and connectivity fronts," the Bangladesh Ministry of Commerce said.

Besides, a Memorandum of Understanding (MoU) between the two countries on mutual recognition of standardisation is likely to be inked at the meeting. The trade talks to be held between the countries will also focus on problems relating to loading and unloading of goods at zero point of the border.
At present, Nepali trucks cannot enter Bangladesh and they need to load/unload at zero point of the border. Most of the traded goods of Nepal are carried via Banglabandha land port.
Similarly, due to absence of such agreement, Nepali trucks cannot reach the warehouses of the land port and they need to wait on no man's land for Bangladeshi trucks to come for re-loading, which increases the cost of business.
The volume of bilateral trade between the two countries is very low, less than $60 million a year. Bangladesh exported goods worth $6.70 million to Nepal in 2008-2009, its imports figured $53 million. Major exports from Bangladesh to Nepal include pharmaceuticals, woven garments, plastic goods, furnace oil, zippers, duck down, dry cell battery, ceramic table ware and handicrafts. Pulses, lentils, rice and wheat make up Bangladesh's import basket from Nepal.

Monday, March 1, 2010

South Asia, China spur tourist arrivals

Tourist arrivals via air have been encouraging in the last couple of months -- South Asian and Chinese arrivals especially posted robust growth.
Figures released by Immigration Office, Tribhuvan International Airport (TIA), reveal that visitor arrivals in February -- compared to the same month last year -- increased by 33 per cent to 33,492. The entire South Asian region posted overall positive growth of 12.1 per cent, with arrivals from India growing by 1.8 per cent, Bangladesh by 110.2 per cent, Pakistan by one per cent and Sri Lanka by 11.6 per cent.
China, one of the largest source markets for Nepal, bounced back with a remarkable growth of 242.5 per cent. Similarly, other Asian countries maintained upward trend with Japan by 31.7 per cent increase, Malaysia by 38.9 per cent, Singapore by 55.9 per cent and South Korea by 21.6 per cent. However, arrivals from Thailand witnessed negative growth by 54.7 per cent. In aggregate, the Asian segment registered a robust growth of 69.5 per cent.
An overall growth of 20.6 per cent was observed from European markets with arrivals from major markets such as the UK, France, Germany, Italy, and the Netherlands up by 1.8 per cent, 46.8 per cent, 12.4 per cent, 44 per cent and 87.5 per cent, respectively. However, Norway, Spain, Russia and Switzerland registered decrease in arrival figures by 41.8 per cent, 22 per cent, 10.4 per cent and 2.4 per cent, respectively.
The figures also show an increasing trend in visitors' arrival from the United States of America with a notable growth of 53.2 per cent, said Nepal tourism Board (NTB).
Canada, Australia and New Zealand also maintained positive growth with 20.5 per cent, 26.9 per cent and 246.6 per cent, respectively.
This is the ninth consecutive month that Nepal has witnessed growth in the international tourist arrivals and this confirms the improved prospects for Nepal in the year 2010 with rising business and consumer confidence.
A total of 33,441 foreign tourists departed via TIA in February 2010. The number of Nepali arrivals stood at 49,288 while 54,564 Nepalis departed via TIA in February.