Tuesday, December 31, 2019

Ncell pays Rs 4.5 billion in CGT

Ncell has started paying its outstanding capital gains tax (CGT), though in installment.
“Of Rs 22.6 billion pending CGT that the Large Taxpayers’ Office (LTO) has asked Ncell to pay, it has deposited Rs 4.5 billion at the tax office today,” the LTO confirmed, adding that the Ncell has also sought permission to pay the remaining outstanding CGT on installment. “Though Ncell has sought the facility of paying the remaining CGT in installments, the LTO is yet to take decision on it.”
According to the section 110 (A) of the Income Tax Act, the tax officer can provide the facility of paying outstanding tax on an installment basis, if the taxpayer makes a written request for such a facility before the tax office files a case in court against such taxpayer.
After a prolonged court battle, the Supreme Court (SC) had determined Rs 22.44 billion as the remaining CGT liability of Ncell. The LTO has thus given Ncell an ultimatum to pay Rs 22.6 billion – including interest – on December 23.
By depositing Rs 4.5 billion as CGT today, the telecom company has hinted at complying with the SC verdict and the LTO direction, the LTO claimed, adding that Ncell has though been concerned over CGT controversy, it has moved to an international tribunal, which recently ordered the government to halt CGT collection from Ncell.
The interim order issued by International Centre for Settlement of Investment Disputes – World Bank’s dispute settlement body on international investment – is obligatory for countries that are its members and the government’s move to collect the outstanding CGT from Ncell amid the International Centre for Settlement of Investment Dispute’s interim order, is contradictory. Ncell, along with Axiata (UK), which now owns Reynolds Holding, filed an application at the global investment settlement body, in April claiming that Nepal’s conduct in relation to capital gains tax imposed on the mobile company is against the Bilateral Investment Treaty between Nepal and the United Kingdom (UN).
Axiata Investments (UK) and Ncell moved the international dispute settlement court in April after LTO asked Ncell to foot the capital gains tax bill of Rs 62.63 billion on Ncell buyout deal.

Employees against splitting CAAN, Government committed to air safety

Though, the private airlines have been pushing the government to split Civil Aviation Authority of Nepal (CAAN) as soon as possible, the trade unions are against the government move to split the aviation sector regulatory body.
Speaking at the 21st anniversary programme of aviation sector regulator today, they warned of padlocking the office, if the decision to split CAAN to two entities is not rolled back. However, Ministry of Culture, Tourism and Civil Aviation (MoCTCA) has already decided to bifurcate CAAN into regulation and operational bodies.
Chair of CAAN Trade Union Shrawan Kumar Yadav, on the occasion, said that the union has already started second phase of protest against the ministry's decision. But minister for Culture, Tourism and Civil Aviation Yogesh Bhattarai, on the occasion, said that the government will go ahead with the CAAN restructuring plan. “The CAAN restructuring plan will not impact professional development of its employees,” he said assuring the CAAN staffers. “But government will come hard on staffers, who object to the decision.”
Restructuring the CAAN is one of the pre conditions to take Nepal out of European Union (EU) black list. The EU has back listed Nepali aircrafts to fly to European skies. Thus, the government is preparing to split CAAN to make the regulatory authority more effective according to the international aviation principles. The split will also prompt the EU remove Nepal from its air safety list, paving way for the Nepali airlines to fly in the European space.
The private airliners, on the occasion, however urged the government to split CAAN – into two entities to avoid hurting the aviation sector – as soon as possible. Its 9 years, the government has been struggling to split CAAN but the plan has not moved forward. Due to delays in passing the legislation, international aviation safety agencies have been slamming Nepal’s poor progress in ensuring air safety.
The government has prepared a draft Civil Aviation Bill that has already been submitted to the Legislative Committee of the cabinet seeking approval to register it in the Parliament. “The proposed law envisages integrating previous acts to eliminate conflicts and contradictions at the CAAN, which is currently functioning as both regulator and service provider, and there is no clear demarcation between its duties and organisational structure, according to the ministry.
The Civil Aviation Authority of Nepal (CAAN) was established as an independent regulatory body on December 31, 1998 as a result of the Civil Aviation Act of 1996. The new law is expected to replace two existing acts, the Civil Aviation Act 1959 and the Nepal Civil Aviation Authority Act 1996.
In December 2013, the European Commission imposed a blanket ban on all airlines from Nepal from flying into the 28-nation bloc after the September 2012 crash of Sita Air Flight 601 in the Manohara River that killed 19 people, including seven British citizens. Likewise, between 2008 and 2012, there were at least two air crashes annually.
“The ban has had a profound impact on Nepal’s aviation and tourism industry,” president of the Airline Operators Association of Nepal (AOAN) Rameshwor Thapa said, adding that travellers hesitate to visit the country, which has been questioned by the commission.
Likewise, tourism secretary Kedar Bahadur Adhikari, on the occasion, said that Nepal’s aviation safety has improved a lot, but there are many things to be done because improvement is a continuous process.

Monday, December 30, 2019

Arun-III to ink financial closure

The SJVN Arun-III Power Development Company is soon signing financial closure.
The company has almost finalised the necessary documents for the financial closure, residential representative of SJVN Arun-III Power Development Company Hareram Subedi said, adding that the company has already forwarded the necessary documents to Investment Board Nepal (IBN) for its final approval. “After it gives a green signal, the company will ink the financial closure with IBN by February,”
SJVN – a subsidiary company of Satluj Jal Vidyut Nigam Ltd of India, which has been tasked with building the project – has however, completed around 30 per cent of construction work of 900-megawatt (MW) Arun-III hydroelectric project.
 Investment Board Nepal is meanwhile discussing with the central bank before granting approval. “
Arun-III – an export-based project, which will bring the largest-ever government-to-government level foreign direct investment (FDI) from India worth $1.2 billion – has signed investment pledge with Everest Bank (Rs 10.5 billion) and Nabil Bank (Rs 5 billion).
The SJVN Arun-III Power Development Company said that they have accelerated the civil, hydromechanical and electromechanical works simultaneously. It has awarded civil works to an Indian firm called JP Construction, which has already started executing the construction work.
The board and SJVN had signed an agreement in November 2014 for the power development agreement of Arun-III hydropower project that is supposed to start generating energy by 2020 according to earlier agreement. But the board and SJVN reached an agreement later to complete the construction of the project by 2023.
Nepal will get Rs 330 billion as royalty in a period of 20 years and the project will also provide 21.9 per cent of the generated energy free of cost, apart from shares to locals and free energy to the affected areas. The project will generate 400 million units of power every year.

Two-third majority government wastes yet another year, fails to boost economy

Despite being historically powerful and two-third majority government, KP Sharma Oil government wasted yet another year as economy failed to gather steam.
The past 12 months of the year 2019 have neither witnessed a remarkable achievement in economy nor in governance, despite the government has set an ambitious target of 8.5 per cent economic growth for the fiscal year 2019-20. Economic indicators are not so encouraging, though this is the second year of the incumbent government that has been making tall claims – of making Prosperous Nepal,  Happy Nepali – ever since it came to power.
First thing first, the budget implementation – as always – remains lethargic, policy implementation continued to be fragile and business environment not so impressive, and the most dangerous part is private sector is fast losing confidence.
Finance Minister Dr Yuba Raj Khatiwada had defended the slow economic growth in the last fiscal year 2018-19 citing that the government throughout the year was focused on developing regulatory framework in line with federalism and the needs of the business community. He has to, however, find another excuse for the current fiscal year for not being able to meet the ambitious growth target of 8.5 per cent, as the economy seems not moving in the right direction to achieve his own target despite his tall claims of focusing on effective budget implementation, development activities and economic growth.
As always, the government failed to accelerate capital budget spending, which will directly hit the capital formation in the coming years too. According to Financial Comptroller General Office (FCGO), the government has, as of today, been able to spend only a mere 10.24 per cent – of Rs 408 billion capital budget –allocated for the current fiscal year 2019-20.
Likewise, the national pride projects including Gautam Buddha International Airport, Upper Tamakoshi Hydropower Project and Melamchi Drinking Water Supply Project expected to be completed within 2019 are yet to be completed. However, it also offers a hope for the next year 2020 as they are nearing completion.
The lifeline of Nepali economy, remittance has also witnessed a slowdown – in the five months of the current fiscal year – as it has dropped compared to the remittance inflow in the last fiscal year. Though, the number of outbound migration of the Nepali workers increased, remittance witnessed a fall by 2.3 per cent to Rs 304.97 billion until mid-November against an increase of 36.4 per cent in the same period of the last fiscal year, according to the central bank data. However, Nepal is still one of the highest remittance recipients in the world with remittance inflow comprising almost equal to 30 per cent of GDP.
Though, the government claimed to have brought some reforms, Global Competitive Report 2019 published by the World Economic Forum in October has ranked Nepal 108th out of 141 economies as Nepal is the worst performer in South Asia in terms of competitiveness.
Likewise, the share market has also not been performing well since Oli appointed Dr Yuba Raj Khatiwada as the finance minister. The share market failed to boost the investors' confidence as the market is under bearish trend since last two years.
Yet another mainstay of Nepali economy, the tourism sector has also not been performing well. The tourist arrivals, though has seen improvement, the count could not surpass last year, which will hit the Visit Nepal Year 2020 also.
Despite gloomy picture, there are some ray of hopes in the late months of 2019 as the trade deficit narrowed – though it seems not sustainable – and Balance of Payments (BoP) position remained in surplus of Rs 27.29 billion till mid-November against a deficit of Rs 57.33 billion in the same period of the last fiscal year. “The total trade deficit narrowed down by 8.9 per cent to Rs 414.02 billion in the four months of current fiscal year 2019-20, though such deficit had expanded 37.8 per cent in the same period of last fiscal year,” according to the central bank data that reveals that merchandise exports increased by 23.9 per cent to Rs 36.28 billion compared to an increase of 11 per cent a year ago, while merchandise imports decreased by 6.9 per cent to Rs 450.3 billion against an increase of 35.8 per cent in the same period of the last fiscal year.
The government has claimed that it introduced many policies to improve the business environment in the country but investors are still suspicious over effective implementation of the policies apart from a number of contradictory policies on tax issues that have discouraged the business community. Though, Nepal improved its ranking by six positions to the 94th position – out of 190 economies across the world – in Doing Business Report 2020 against 110th position in 2019, the private sector is losing confidence due to government’s anti-private sector move. 
Despite the political stability – that the private sector craved for in last 3 decades – the two-third majority government is creating fear in the business community instead of instilling confidence by also using government machinery to seek ransom from private sector.
 The private sector is more hesitant and losing confidence gradually due to various restrictive policies of the government that have provisions of imprisonment even for minor mistakes, apart from ransom seeking attitude, one of the prominent business person said, adding that despite stable government and reliable supply of electricity, the business community has hold all the investment plans recently.
Likewise, the government has also failed to crack whip on inflation as the consumer price inflation (CPI) stood at 5.76 per cent in mid-November compared to 4.15 per cent during the same period in the last fiscal year.
The economy, however, grew by 7.1 per cent in the last fiscal year, the third continuous year that the economy has expanded by over 6 per cent. And the economy is poised to expand by around 6 per cent in the current fiscal year, according to projections of development partners including World Bank (WB), Asian Development Bank (ADB) and the International Monetary Fund (IMF).
Despite government’s effort to bring in notable amount of foreign investment, in the fiscal year 2018-19, Nepal received Rs 13.07 billion in FDI against the pledged Rs 24.99 billion. Likewise, as against FDI commitment of Rs 55.73 billion in the fiscal year 2017-18, Nepal was able to see only Rs 17.51 billion in actual investment. Nepal, however, received investment commitments worth Rs 10.76 billion in the first three months of the current fiscal year, up from Rs 4.8 billion during the same period last year.

Trans-Himalayan connectivity key for Nepal's development

The trans-Himalayan connectivity is key to Nepal's development and prosperity, according to deputy prime minister and defence minister Ishwor Pokharel.
Addressing one-day conference on ‘Friends of Silk Road Trans-Himalaya Connectivity Cooperation for Shared Prosperity’ organised by Trans- Himalaya Development Center in the Kathmandu, he said that connectivity along the trans-Himalayan region is crucial for Nepal's development.
Saying that adequate discussions were needed to ensure uniformity in understanding the connectivity before initiating any action, he said that the Belt and Road Initiative (BRI) is very relevant for Nepal’s development and Nepal should not get confused.
Referring to Chinese President Xi Jinping's remarks about helping Nepal transform to a land-linked country from a landlocked one by opening more customs points, Pokharel also argued that the trans-Himalayan connectivity will bring benefits not just to Nepal but to the whole trans-Himalayan region.
Saying that unprecedented interdependence among countries highlights the importance of connectivity, ambassador of China to Nepal Hou Yanqi said that better roads improve lives of the people. “Strengthening the connectivity in the Himalayan region, the most complicated topography in the world, is of great difficulty,” she said, adding that the challenge will however not stop them. “We made efforts with the hope to deepen the bilateral cooperation in the areas of trade, investment, cultural and people-to-people exchanges, and with the view to contribute to Nepal's development agenda that includes graduating from the LDC status at an early date.”
Former Foreign Minister Dr Prakash Sharan Mahat, on the occasion, also said that Nepal should be very serious to take maximum benefits from trans-Himalayan connectivity. While adding that identification of project was very crucial based on the expert opinions and the returns of investment, he argued that China could be a good source country for foreign investment to help Nepal generate employment at home and reduce the trade deficit with China.
Likewise, former Nepali ambassador to the US, Dr Shankar Sharma highlighted the need for carrying out more research in several key areas like the impact of railway project to the trade of Nepal and overall economy of Nepal, employment generation, improvement in people's day to day livelihoods and contribution of connectivity to the GDP.
Chair of Trans-Himalaya Development Centre Dr Kalyan Raj Sharma, on the occasion, said that a trans-Himalayan connectivity network will be the best option to end infrastructure gaps and development bottlenecks in the region.

Tourism ministers of four foreign nations to attend VNY inauguration

Contrary to the ministry’s expectations, tourism ministers from only four countries are expected to take part in the inaugural ceremony of Visit Nepal year 2020 (VNY2020) to be held at Dasharath Stadium on January 1.
Tourism ministers of India, China, Myanmar and Jamaica, along with delegations from seven countries, will attend the inauguration ceremony, according to the Ministry of Culture, Tourism and Civil Aviation. The minister for Culture, Tourism and Civil Aviation Yogesh Bhattarai had earlier said that tourism ministers from 40 countries will be invited for the inauguration ceremony.
“The participation of 20 delegations from tourism bodies of different countries has also been confirmed,” the ministry confirmed, at a press briefing organised in Kathmandu today. “The ministers from India and China will arrive tomorrow, whereas some delegates including high-level government representatives from Qatar, Bhutan and Cambodia have already arrived,”  it said, adding that the government is also set to inaugurate the year-long campaign in seven provinces simultaneously. “The inauguration ceremony will take place at Biratnagar of Province 1, Janaki Temple of Province 2, Sauraha of Province 3, Pokhara of Gandaki Province, Bardiya of Province 5, Surkhet of Karnali Province and Dhangadhi of Sudurpashchim Province.”
The inauguration ceremony in Kathmandu will have cultural performance of different ethnic groups and indigenous nationalities, the ministry said, adding that Nepal Army, Nepal Police and Armed Police Force apart from Nepali artistes will also perform on the occasion that is expected to be participated by some 20,000.
Informing the press, national programme coordinator for the VNY 2020 Suraj Vaidya, said that all preparations for the inauguration ceremony have been completed. “The VNY 2020 will be inaugurated by President Bidhya Devi Bhandari, while Prime Minister Khadga Prasad Oli will make a special address,” he said, adding that the inauguration ceremony will see participation of Vice President, former prime ministers, leaders of different political parties, ministers from provincial governments, members of parliament, and chief of constitutional bodies.
The preparation for the campaign formally kicked off with the setting up of a campaign secretariat in November of 2018, under the coordination of Vaidya. The campaign secretariat also decided to establish promotional centres at all Nepali embassies across the world to promote the campaign jointly with NRNA. “The logo and banners of VNY 2020 were posted on local buses, subways and rail stations in Canada and the UK,” he said, adding that the international celebrities have also been appointed as ambassadors to promote the campaign in different countries. “Around 40 media from across the world are also taking part in the inaugural ceremony of VNY 2020 in Kathmandu.”
He also said that the visit of renowned international personalities in 2019 is also going to play a significant role in 2020. The visit of President of China Xi Jinping and President of Bangladesh Mohammad Abdul Hamid in 2019 is expected to attract more number of tourists from China and Bangladesh in 2020, he added.
Likewise, Civil Aviation Authority of Nepal (CAAN) organised the 56th Director Generals of Civil Aviation conference in 2019, which saw the participation of around 400 foreign guests from 46 countries. It has also witnessed representatives from 14 different international organisations associated with International Civil Aviation Organisation, including European Union, Boeing, Airbus and International Air Transport Association, who has taken the message of VNY back home.
Similarly, Nepal has just hosted the South Asian Games 2019, where a large number of international players visited Nepal. The successful SAG has also raised hopes of establishing Nepal as a sports tourism hub in the future
Though, there have been some issues like fake rescue scam, the mountaineering sector is also expected to attract more trekkers and mountaineers. The Department of Tourism (DoT) had issued expedition permits to a total of 868 climbers for 30 different peaks in 2019. Of them, some 381 members from 48 countries had received expedition permits to scale Mt Everest and among them 14 members were from Nepal,” the department informed, adding that nine climbers died while scaling Mt Everest from the Nepal side during the spring season, with the congestion largely blamed for the deaths.
In autumn season, the department issued expedition permits to a total of 1,210 climbers for 51 peaks. Expeditions to five virgin peaks of above 6,000 metres – Panpoche I, Panpoche II, Hunku Chuli, Hongu and Linku Chuli – were also successfully completed in the autumn season, attracting more mountaineers to Nepal.
Apart from the mountaineering, the travel and tourism entrepreneurs have been planning to develop new packages to attract tourists. “Visit Nepal 2020 will give government an opportunity to announce that cities like Pokhara, Kathmandu, Bhaktapur, Lalitpur and Bhairahawa remain open 24/7,” according to them. The Thamel, Tangal, King’s Way and Jhamsikhel in Kathmandu Valley can be developed as nightlife hubs, they said, adding that it is also right time to rebrand Nepal in the international market.

Sunday, December 29, 2019

IBN approves Rs 85 billion investment for three hydro projects

The government today approved foreign investment worth almost Rs 85 billion for three hydropower projects.
The 42nd meeting of Investment Board Nepal (IBN) today – chaired by Prime Minister KP Sharma Oli – has approved foreign direct investment (FDI) for 216-megawatt (MW) Upper Trishuli 1, 50 MW Marshyangdi Besi and 37 MW Upper Trishuli-3B, confirmed IBN chief executive officer Maha Prasad Adhikari.
“While the IBN has approved Rs 65 billion investment for Upper Trishuli 1, Rs 11.77 billion has been approved for Marshyangdi Besi and Rs 8.22 billion for Upper Trishuli-3B,” he said, adding that the meeting has also extended the term of compensation dispute committee of the 900 MW Arun-III hydropower project that is looking into various issues and asked it to resolve them within two months.

Agitating sugarcane farmers stage protest in Kathmandu

Sugarcane farmers from across the country today staged protest at Maitigar in Kathmandu against the delayed payment of outstanding dues from sugar mills.
Organising a protest, they said that they were compelled to start the protests as sugar mills were reluctant to issue almost Rs 1.5 billion pending dues to farmers. Farmers had been staging protests in their respective districts against the delayed payment for their produce has shifted their protest movement to the Capital as the government was reluctant to address their concerns. As their concerns remain unaddressed, farmers not only staged a protest in Maitighar today but also organised a sit-in programme in front of Singha Durbar to pressurise the government.
“The crushing of new sugarcane is soon to start,” president of Nepal Sugarcane Producers Federation Kapil Muni Mainali said, adding that sugar mills have, however, not cleared the payment for last year’s cane to farmers. “We were forced to launch protests in Kathmandu as the government is doing nothing to ensure that farmers get their payments on time.”
Among the various sugar mills, Annapurna Sugar Mill has yet to issue payment worth Rs 50 million, whereas Sri Ram Sugar Mill has not paid almost Rs 420 million since the last three years, they claimed, adding that the Sarlahi-based Maha Laxmi Sugar Mill too has been delaying payments worth Rs 210 million. “Likewise, three Nawalparasi-based sugar factories – Indira Sugar Mill, Bagmati Sugar Mill and Lumbini Sugar Mill – are yet to clear Rs 210 million to cane farmers.”
Mainali also said that Annapurna Sugar Mill, Shree Ram Sugar Mill, Mahalaxmi Sugar Mill and three other sugar mills in Nawalparasi have shut down their operations saying that they will not be able to operate the factories, if they make payment to the farmers.
The sugar mill owners have not paid them since 2013, though they have entered into an agreement, he said, adding that the farmers took to the street demanding the immediate payment to them despite cold and chilly weather. “Factory owners had promised farmers that they will clear their dues in installments but farmers said they cannot trust the mill owners.”
The government has fixed the purchase price of sugarcane at Rs 563.56 per quintal but the sugar mill owners have paid Rs 500 to the farmers, they claim, adding that the mill owners have not been releasing payments to farmers though they have been selling sugar and the demand for Nepali sugar is also increasing in the market.
However, president of Sugar Producers Association Sashi Kant Agrawal said that the domestic sugar mills have not been able to sell their product following huge imports from India and Pakistan two years ago. “The sugar import from India has not stopped yet,” he said, adding that cheaper sugar is entering the country – both legally and illegally – as the Indian government has provided a subsidy of Rs 18 per kg in the export. “Unless the import stops, the sugar producers will not be able to pay farmers due to price difference on imported sugar and domestic product.”
The factories have been running in losses – and are not able to make payment – thus the government needs to prepare a payment schedule for farmers and make payments accordingly to resolve the sugarcane farmer issue, added the president of the association – which claims that there are around 15,000 farmers engaged in commercial sugarcane farming in Sarlahi alone including 100,000 farmers in 15 districts – Agrawal.
Meanwhile, Ministry of Industry, Commerce and Supplies has sent a letter to the Home Ministry today to take action against sugar producers, who have failed to pay farmers.

Central bank directs BFIs to provide easy loans for EV charging stations

The central bank has directed banks and financial institutions (BFIs) to give priority in issuing loans to establish charging stations for the promotion of electric vehicles (EVs).
The central bank – issuing a directive to BFIs,, which has given priority in lending for charging stations for EVs as a priority area for disbursing loans in line with the government move to increase electricity generation and simultaneously increase the use of electric vehicles too – directed the BFIs to accord priority to providing loans for the construction of charging stations as hydropower is a renewable energy and will play a vital role in the public transport sector.
The government is aiming at increasing the volume of electric vehicles across the country by 30 per cent within the next 10 years. Meanwhile, Nepal Electricity Authority (NEA) has also started the process to construct 50 charging stations in Kathmandu valley and along major highways.
Earlier, Ministry of Energy, Water Resources and Irrigation had – on August 29 – also drafted guidelines to set up more than 200 EVs charging stations to prioritise EVs to maximise the use of electricity.
According to the ‘operational guideline of electric vehicle and establishment of charging stations’, the NEA will be responsible for giving approvals to set up charging stations, ensure uninterrupted power supply and monitor their security and leakage. “The power utility will also be responsible for determining service charge, testing and authenticating the charging stations.”

Nepal-Australia direct flight on cards

After Nepal and Australia signed a bilateral agreement on October 2, both the countries have been working on to ensure a direct flight between Kathmandu and Sydney.
Around 150,000 Nepalis currently reside in Australia and in the absence of direct flight between Kathmandu and Sydney, the Nepali community and tourists are forced to visit through various transits.
According to data of the Sydney Airport, the arrival of passengers to Sydney from Kathmandu has reached 121,260 so far this year, which is the largest number, when it comes to those nations lacking a direct flight.
Nepal Airlines Corporation (NAC) has also conducted a feasibility study of a direct flight between Kathmandu and Sidney. “The distance between Kathmandu and Sidney is approximately 10,000 kilometers,” the study reads, adding that constant discussions are underway on various technical aspects of the project following an agreement.

Mountain guides demand social security

The mountain guides have asked the government to ensure social security for them.
While marking the 14th National Mountain Guide Day here today, they said that the mountain guides are the backbone of the climbing industry and the government must work for their betterment.
President of Nepal National Mountain Guide Association Ang Norbu Sherpa said that mountain guides are often low-paid and also there is no guarantee of social security. “The guides always risk their lives to support the expedition members so their contribution to the climbing industry must be honoured,” he said, adding that mountain guides worked for the welfare and safety of climbing members but the concerned stakeholders have not increased their investment in them.
On the occasion, the association also awarded certificates to five new IFMGA mountain guides and four aspirant guides, who successfully completed the 11th batch of NNMGA course in 2019.
Tourism secretary Kedar Bahadur Adhikari, director general at the Department of Tourism Dandu Raj Ghimire and association president Sherpa jointly awarded certificates to 11 guides, who completed the level IV of the National Skill Testing Board exams under CTEVT. “The association is committed to providing necessary trainings to produce trained manpower, provide quality service and minimise risks relating to mountaineering,” Sherpa said, adding that the association has also inked a memorandum of understanding (MoU) with Nepal Mountaineering Association (NMA) for five years to jointly conduct mountain and aspirant guides training courses. “The Aspirant Guide Course, which consists of three components spread over a span of 10 months, incorporates a total of 47 training days.”
It is the first step to pursue advanced International Mountain Guide – IFMGA – he said, adding that after completing two years in the guiding field, aspirant guides can take IFMGA exam by fulfilling additional criteria. “Two trekking peak ascents, one expedition style ascent with at least two camps in altitude and eight days of ascents – without clients – on all type of terrain are other criteria for aspirant guides to take part in IFMGA course. “The association had launched aspirant guide training in 2007 while the first batch of international mountain guide graduated in 2009.”

Saturday, December 28, 2019

Electricity demand surges to record 1,338 MW

Though the government is planning to promote use of electric vehicles as well as electric stoves for cooking to increase consumption of electricity, Nepal Electricity Authority (NEA) has started facing a problem in its distribution system due to increasing power consumption.
Of late consumers have started facing frequent power cuts also due to high demand, confirmed state power utility. “The distribution system is overloaded and feeders are tripping due to record high demand of 1,338 megawatts (MW) because of increasing cold weather, especially in Kathmandu valley, and subsequently due to the increase in the use of electrical appliances like air-conditioners and electric heaters,” the NEA informed, adding that transformers, especially, in Kathmandu valley are facing problems of overload and distribution cables are catching fire, though the NEA is managing supply by repairing the problematic feeders and distribution lines.
According to managing director of NEA Kul Man Ghising, most of the transformers, feeders and cables are overloaded at present due to increasing demand. But he assured that they are trying to address the issue of electricity tripping by upgrading and replacing the local distribution system.
The authority but claims that it has already replaced all the transformers in the Valley to ease the situation but the electricity tripping – commonly referred as power fluctuations – has equally affected the household consumers, industries and other businesses. “The power utility has also given top priority to augment the transmission and distribution system and is installing double-circuit high-capacity transmission network to enhance the quality of power supply,” Ghising said, adding that the NEA has already replaced almost 7,000 transformers in the last fiscal and 1,041 in the first four months of this fiscal year. “The process to replace over 6,000 transformers across the country is ongoing, which will increase the capacity of the distribution system by 20 per cent.”
NEA is upgrading 100 substations across the country, particularly in the major load centres and other major problematic areas. “The authority will also upgrade the transmission and distribution system to handle additional 1,000 MW of power next year, he added. “The NEA will have to upgrade the transmission lines as some 5,000 MW of electricity will be connected to the national grid by 2024, and NEA needs to install 15,000 new transformers by then.”
Kathmandu Valley’s demand has increased to above 400 MW at present from 250 MW to 325 MW in normal times peak demand. Likewise, the country’s peak demand stands at 1,338 MW currently but NEA has been generating 508 MW and independent power producers are generating 332 MW, whereas import from India stands at 498 MW. “But Nepal has also been exporting 40 MW to Bihar in India.”

Over 200 startups participate in BizStart 2019

Google Business Group Nepal chapter held the second edition of BizStart 2019 today in Kathmandu to provide a platform for startup companies. According to the organiser, some 210 startups participated in the one-day event that saw over 10,000 visitors.
“Our main aim is to provide a platform to the startups so that they get an opportunity to find investment, business and networks,” said manager at Google Business Group Nepal chapter Amit Agrawal. Besides the exhibition, the organiser also conducted a training session on developing entrepreneurship skills for entrepreneurs. Last year, a total of 100 startup companies participated in the event.
‘Even unregistered startup companies participated in the event as there is no fee to join and visitors can enter for free,’ Agrawal said, adding that the startups showcased their ideas, from using drones to irrigate farms, reviving analogue music to creating customised tour packages. “Some were working on robotics, recycling, food business, health, apparel and developing mobile apps.”
Google Business Group has been organising the event on an annual basis to bring entrepreneurs and startup-founders together from around the country under one roof. Besides displaying their products and services, startups also get an opportunity to learn new strategies and expand their businesses with Google’s technology, said the organiser. “The changing business environment in the country and rise of successful startups have inspired youths to set up their own companies,” he said, adding that the government needs to do more to encourage startups.

Tourism agencies announce discount offers

As the Visit Nepal Year 2020 (VNY2020) starts in two days, tourism agencies have announced discount offers to encourage foreigners to prolong their stay in Nepal and also visit frequently.
The VNY2020 being launched with formal programme on January 1 warrants attention and engagement of the people from diverse sectors for its grand success. Tourism ministers from 10 countries and special guests from various 40 countries will take part in the inaugural ceremony of the VNY2020.
Hotel Association of Nepal (HAN) has decided to provide 30 per cent discount on its services, according to the first vice chair of HAN Binayak Shah.
There are some 2,000 hotels including the luxury star hotels affiliated to HAN, which can accommodate some 2.5 million guests.
Likewise, Trekking Agencies' Association of Nepal (TAAN) is also launching promotional activities and providing 20 per cent discount on its service, whereas Nepal Association of Tour and Travel Agents (NATTA) is going to provide concession of 10 per cent to the service seekers. Similarly, Nepal Association of Tour and Travel Agents (NATA) has offered 10 per cent discount on its services on the occasion of VNY2020. According to NATA president CN Pandey, the customers, who purchase tour packages through NATA-associated travel agencies shall be provided 10 per cent discount in its services. Similarly, Nepal Association of Rafting Agencies (NARA) president Ganga Prasad Nepal shared that NARA has announced 15 per cent discount for rafting and other water-related adventure sports to the foreign visitors on the occasion.
Likewise, Nepal Mountaineering Association (NMA) is also going to announce some package for the tourists, whereas Homestay Association's president Keshav Badal informed that foreign guests choosing homestay will be offered up to 20 per cent discount on lodging and foods. There are more than 600 homestays being run in 57 districts and are associated with the association.
Pacific Asia Travel Association (PATA) Nepal Chapter president Bidhutichand Thakur also informed that PATA Nepal Chapter is going to organise various promotional events targeting the VNY2020, one of which is Nepal, India, China Expo ('NICE' event) coming February.
Thamel Development Council is also going to organise various promotional events round the year in 2020.

TIA runway rehabilitation completes before deadline

Giving surprise to Nepalis as not a single project has ever completed in time in Nepal, the rehabilitation of Tribhuvan International Airport (TIA)'s runway has been completed 128 days ahead of the stipulated deadline.
After completing the project, China National Aero-Technology International Engineering Corporation (AVIC-ENG) – a state-owned enterprise of China – handed over the runway and taxiway of TIA to the Civil Aviation Authority of Nepal (CAAN) at a ceremony in Kathmandu today. The handing over certificate was signed by project manager of Rehabilitation of Runway and Taxiways Wang Jianxin, team leader of Yooshin Consultant Kyu Choel Choi, project director from CAAN Engineer Murari Bhandari and general manager of TIA Devendra KC.
The rehabilitation of the runway that started on April 1 has been completed in three months on June 30 with Rs 3.75 billion for blacktopping of the runway. The state-owned enterprise of China was awarded the project – a year ago – as it bid the lowest bidder among the four shortlisted firms.
Speaking at the handover ceremony, minister for Culture, Tourism and Civil Aviation Yogesh Bhattarai said that the rehabilitation of the airport will be instrumental for the Visit Nepal Year 2020 (VNY2020).
Likewise, director general of CAAN Rajan Pokhrel, on the occasion, said that the situation of the airport has been so bad that aircraft had to be put on hold for a long time or had to be diverted to airports like Lucknow. “But with the contractor completing the project almost five months ahead of the deadline despite challenges like active runway has made the TIA operations easier.”
The TIA started maintenance of the runway following the pressure on safety of air travelers because of the potholes and cracks in only runway.
“Successful completion of the important projects benefits Nepal by improving air connectivity with other countries,” said Chinese ambassador to Nepal Hou Yanqi, on the occasion. “It will also contribute to improve the tourism industry,” she said adding that the improvement of the airport can accommodate more tourists and attract more travelers into the country and improve travel experience. “The improved transportation and infrastructure development, the country will become popular amongst Chinese tourists.”

Friday, December 27, 2019

TAAN seeks revision of TIMS card pact with tourism board

Trekking Agencies’ Association of Nepal (TAAN) is seeking to revise the agreement signed with Nepal Tourism Board (NTB) regarding distribution of Trekkers Information Management System (TIMS) card and managing the amount collected from issuing the TIMS cards.
Issuing a white paper today, TAAN said that NTB has not released its share of amount from issuance of TIMS card. “Thus, TAAN is ready to revise the agreement, if needed,” the white paper reads, adding that some 30 per cent of the amount collected from TIMS goes to TAAN’s organisational account, while 30 per cent goes towards NTB’s organisational account. “Likewise, 30 per cent of the amount goes to the joint account of NTB and TAAN, while the remaining 10 per cent is deposited in the workers’ welfare fund.”
“But TAAN has not received the agreed amount for the last five years,” the white paper reads, adding that it has affected tasks like helicopter, medicine, administration expenditure and salary for staff, research and promotion of new destinations. “And the amount that TAAN is seeking from NTB is related to its share of money collected in the joint account of the organisations.”
TIMS was jointly implemented by NTB and TAAN according to the direction of Nepal government from January 1, 2008 to ensure the safety and security of trekkers and also to control illegal trekking operations,” according to the TAAN. “Since then, TAAN has been issuing TIMS cards to group trekkers (GT), while NTB distributes it to free individual trekkers (FIT).”
According to the white paper, TAAN’s demand has not been addressed despite frequent discussions with the concerned authorities. “The TAAN has not received its due share of the amount collected in the joint account since the last five years,” the white paper reads, adding that it has also adversely affected the administration expenses and wages of staffers working at the TIMS collection centre, along with the work of introducing and promoting new trekking routes.
Due to the tug of war between the NTB and TAAN on income from TIMS card, TAAN has also been not able to renew the organisation since past years. It has not been renewed for the last two fiscal years – fiscal year 2018-19 and fiscal year 2019-20. TAAN was last renewed in fiscal year 2017-18. “The auditing of TAAN and Trekkers' Information Management System (TIMS) is done collectively, showing TAAN's earning in millions according to the white paper.
AAN has been – citing the security issues of trekkers – demanding the government to stop distributing trekking permits to individual trekkers. It also showed concern over the country's inability to provide TIMS card through online system.
TAAN is working to provide 20 per cent off to foreign trekkers by its member companies on the occasion of Visit Nepal Year 2020, the white paper reads, adding that it will contribute in welcoming 800,000 tourists to the country during VNY 2020.

Planning commission finalises 654 projects to receive special grants

National Planning Commission (NPC) has finalised the list of some 654 projects that will get special grants for the current fiscal year, though half the fiscal year has already passed.
The commission has segregated the projects and programmes for the provincial governments and local governments according to their demands and requirements, the planning commission vice chair Dr Puspa Raj Kadel conformed. The delay in finalising the projects is attributed to the inability of provincial and local governments to submit their projects earlier as per the procedure developed by the commission, he said, adding that the government had – on December 11, 2018 – developed the ‘Procedure for Special Grants’ with necessary provisions regarding the grants to be provided to projects or programmes run by the provincial or local levels. “Of the total 753 local bodies, some 149 were deemed ineligible for the special grants as they did not fulfil the criteria set in the procedure.”
The commission has finalised 50 projects and programmes for seven provincial governments and 604 projects and programmes for the local governments. “While the local governments had requested special grants of Rs 12.50 billion, they were allocated Rs 4.83 billion, and the provinces had sought special grants worth Rs 22.56 billion but were allocated only Rs 4.60 billion.”
Of the total 50 projects, the commission has allocated special grants for nine projects in Province 1, seven projects in Province 2, five projects in Province 3, four projects in Gandaki Province, six projects in Province 5, some 11 projects in Karnali Province and eights projects in Sudur Paschim Province, the commission confirmed, adding that it will soon call on the provinces and local levels to submit their proposed projects and programmes for the special grants for the next fiscal year to ensure its timely execution from next fiscal year.
“No provincial or local levels shall be allowed to use the special grants in projects or programmes operated with equalisation, conditional and complementary grants or its own resources,” according to the ‘Procedure for Special Grants’.
The federal government can provide special grants for any project or programme to be run by the provincial or local governments for educational development of areas with low literary rate, lacking basic health services, sanitation, water supply and for uplift of groups or communities, equitable economic and social development, according to the federal government’s planning agency.
According to the procedure, special grants may also be provided to maintain balance among the local levels or provinces in terms of physical and human development, ensure food security in the areas with low food production, and manage waste by using modern technologies.

Local governments to get Indian aid as conditional grant

The government is going to disburse aid under India’s Small Development Project Scheme (SDPS) to local governments after channeling resources to the national budget.
The cabinet – on December 23 – approved a proposal of the Finance Ministry about ways to implement the projects to be financed under the scheme that has been in the news for all the wrong reasons. The scheme had remained controversial due to its nature of direct funding to the projects through local governments from the Indian Embassy in Kathmandu without using the Federal budgetary system.
According to the new modality, SDPS will be brought under the federal budgetary system and channeled to the local governments as conditional grants, in line with the Development Cooperation Policy introduced in May.
Conditional grant is the type of grant provided to implement a specific project and the local government cannot spend it on other projects. The government can allocate the budget for the local level from the fiscal year 2020-21 after the federal government gets the Indian aid, according to the Finance Ministry. “Under the scheme, India has been providing up to Rs 50 million to implement small infrastructure projects through the local governments.”
Earlier the grant used to go to the local levels directly raising eyebrows. But after the new constitution promulgated in 2015 required foreign assistance to be channelled through the national budget to ensure transparency in aid, the Sher Bahadur Deuba-led government in November 2017 extended the tenure of the scheme with the caveat that funds pass through national budgetary system, The Federal government will decide which agency implements the project, according to the new rule.
A cabinet meeting – in July 2018 – made it mandatory for India to sign an agreement with Finance Ministry to implement the projects under the scheme and route funds through the central account.
Launched in November 2003, the projects are popularly known as ‘umbrella agreement’, on the basis of which the Indian Embassy in Kathmandu had been extending assistance to various projects.
But bringing the Indian aid under the small grant scheme will not only promote transparency but also helps keep tab on how much money has been spent under the scheme.

Thursday, December 26, 2019

US-NPRC demand MCC to be ratified immediately

The US-Nepal Policy Research Center (US-NPRC) has demanded for immediate ratification of the multi-million US dollar Millennium Challenge Corporation (MCC) compact
Saying that a failure could tarnish Nepal's international image, the US-based Center said that it wants to urge the Nepal government, the parliament and political leaders to be serious and honest in implementing the compact. “The failure on timely ratification could tarnish Nepal's international image and trustworthiness.”
The implementation of the project has to be completed within five years beginning June 2020 and the delay could hamper its timely completion," a press note issued by the centre reads.
In September 2017, the US government’s Millennium Challenge Corporation (MCC) signed a $500 million compact with Nepal. The compact aims to increase the availability and reliability of electricity, maintain road quality, and facilitate power trade between Nepal and India, helping to spur investments, accelerate economic growth, and reduce poverty..
The US-NPRC is working in the field of science, technology, education and policy through research, training, professional development programmes, and share knowledge and experience gained from research and analysis through training, seminar, and workshops in the US and Nepal.
The center has over 50 members across the US, mostly academicians.

Paddy production likely to drop

The total paddy production is estimated to be 5,431,549 Metric Tonne (MT) this year – representing some 1.7 per cent decrease compared last year, when the paddy production posted some 5.6 million MT. “The total area of paddy planted also decreased slightly compared to the last year, as it has been estimated to be 1,480,288 hectares this year against 1,491,744 hectares in 2018,” according to a publication that is a joint product of the Ministry of Agricultural and Livestock Development, the World Food Programme, and the CGIAR Research Programme on Climate Change, Agriculture and Food Security (CCAFS) as part of the Nepal Food Security Monitoring System (NeKSAP).
“However, the forecasted land productivity is estimated to be 3.67 MT per hectare. The yield estimates have a prediction uncertainty of ±7.5 per cent,” it reads. “Although the onset of the monsoon was delayed – late mid-June – average rainfall across the country before the onset of the monsoon was close to normal.”
Heavy rainfall across the country’s Terai lowlands on July 11-12 led to extensive flooding, which damaged large areas of cultivation thereby slightly decreasing paddy production,” it reads.
According to the real time stations data provided by the Department of Hydrology and Meteorology, pre-monsoon rainfall exceeded 30-years-of-normal in the eastern and central parts of Nepal, while it was lower than average in the Western part of the country. “Eastern Terai received above average rainfall during the monsoon period that was mainly concentrated during the mid-July leading to excessive flooding,” it reads, adding that Central and Eastern regions received rainfall lower below their 30-year averages during the monsoon months.
Under the research theme on Climate Risk Management, the CGIAR Research Program on Climate Change, Agriculture and Food Security (CCAFS) developed a crop yield-forecasting tool customised for the South Asia Region known as the CCAFS Regional Agriculture Forecasting Toolbox (CRAFT). CCAFS is a strategic partnership of CGIAR and Future Earth, led by the International Center for Tropical Agriculture (CIAT), which conducts research to identify and address the most important interactions, synergies and tradeoffs between climate change, agriculture and food security.
CRAFT uses historical databases of weather and crop yields and current weather to estimate yields of various crops. The yield forecasting depends on data from various sources such as meteorological data – rainfall, temperature, humidity, bright sunshine hours, wind speed, wet spell etc – agro-meteorological data (phenology), soil data (water holding capacity), remote sensing data and agricultural statistics.
CRAFT simulates plant-weather-soil interactions in quantitative terms and predicts the crop yield over a given area, prior to harvest, provided no extreme (statistically infrequent) conditions occur. These models are based on a ‘common sense’ assumption that weather conditions are the main factor behind the inter-annual (short term) variations for the de-trended crop yield series.

Some 63 per cent progress in rebuilding private houses

There has been 83 per cent progress in the post-earthquake reconstruction of private housing, schools, government buildings, health institutions and cultural heritages during four years of its establishment.
The figure, however, also includes houses which are under reconstruction, according to the National Reconstruction Authority (NRA) that has completed the fourth year of its establishment. “The reconstruction of some 482,323 private houses, out of 780,165 households with which NRA had inked the housing grant, has been completed so far,” it informed, adding that some 189,041 quake-damaged houses are currently being rebuilt. Some 5,380 or 71 per cent of 7,553 educational institutions affected by the earthquakes have been reconstructed till date, whereas reconstruction works of 1,787 institutions is currently ongoing.”
Likewise, of the 891 cultural heritage sites of 32 districts damaged by the devastating earthquakes, the reconstruction of some 387 sites has been completed, while reconstruction of 123 sites is ongoing, the NRA informed, adding that of the 1,197 health institutions affected by the quakes, reconstruction of some 665 has been completed, while reconstruction of 149 such institutions is ongoing.
 “The reconstruction drive is smooth and has made significant progress in recent months,” NRA chief executive officer Sushil Gyewali informed, organising a press conference today. “Rs 335 billion has been spent in the reconstruction works so far,” he said, outlining a few challenges including resource management as the reconstruction process moves ahead. “The reconstruction work still has huge budget deficit.”
According to him, the NRA still has a deficit of Rs 300 billion to complete the entire reconstruction works, while it requires Rs 34 billion within this fiscal year.

Visit Nepal year 2020 will be inaugurated in Dasharath stadium

The government is planning to inaugurate the Visit Nepal Year 2020 (VNY2020) formally on January 1 as the national festival.
The VNY2020 campaign – with the goal of hosting 2 million tourists in the country – will be inaugurated by the President Bidhya Devi Bhandari at the Dasharath stadium, where Prime Minister KP Sharma Oli will also make a special address, confirmed Visit Nepal Year Secretariat.
“The chief ministers of all seven provinces will also be present on the occasion,” it informed, adding that the Visit Nepal Year will be inaugurated at the Nepali Embassy in foreign countries on January 7, while the Visit Nepal 2020 would be inaugurated through Non-Resident Nepali Association (NRN) in the countries, where there is no Nepali mission. “The government has invited tourism ministers and senior delegates of 31 countries on the inaugural ceremony.”
Media persons from some 40 countries – including India, China, Bangladesh, European countries – are also attending the Visit Nepal Year inauguration programme, according to the Ministry of Tourism, Culture and Civil Aviation.
The Nepal Tourism Board (NTB), which is responsible for managing the visit of the journalists, is also planning some fam trips for the foreign media personals.
According to Visit Nepal Year 2020 National Programme Coordinator Suraj Baidya, the Visit Nepal Year inauguration programme will be another big international level programme to be organised in the country after the 13th South Asian Games, which concluded recently. “The secretariat has made all preparations for that purpose,” Baidya said, adding that the final preparations have been completed for the Visit Nepal Year 2020 inauguration. “The government will spend Rs 20 million for the inaugural programme.”
The government has recently approved Rs 617.4 million budget for the Visit Nepal Year campaign.

Kathmandu to restart night buses

Kathmandu Metropolitan City – in coordination with the Department of Transport Management – is once again operating night buses in Kathmandu, though some 8 years ago, it failed to continue the service.
Spokesperson at the metropolis Ishwor Man Dangol confirmed that the metropolis is – after numerous failed attempts – planning to operate night bus also targeting the Visit Nepal Year 2020 (VNY2020) campaign.
The metropolis and the department – on June 10 – also said that they planned to start bus services before too but could not start. The department had – on the same day – hiked bus fares by 20 per cent without holding any proper discussion with the stakeholders. But the next day, Ministry of Physical Infrastructure and Transport ordered rolling back the hiked fare.
But the metropolis is planning to start the night bus service before Visit Nepal Year 2020, Dangol said, adding that it is planning to operate a round the clock inexpensive bus services from Tribhuvan International Airport (TIA) to Central Business District. “In its official gazette – issued on April 12 – the metropolis had directed public transport operators to run vehicles from 5 am to 9 pm between October 18 to February 12, and 5 am to 10 pm between February 13 and October 17 but the order has not been implemented.”
With its Rs 2.5 million and Finance Ministry’s Rs 2 million budget in 2012, the metropolis had operated 16 buses after 8 pm but due to a lack of proper planning, it couldn’t last more than six months.
The transportation sector is led by the private sector.

Wednesday, December 25, 2019

High Court issues interim order not to organise strikes in essential sector

The Patan High Court has prohibited any sort of protest activities inside banks. The Patan High Court today issued an interim order not to organise any type of strike in bank offices as the banking sector comes under the essential sector.
A single bench of judge Tek Narayan Kunwar issued the interim order not to organise any type of strike hampering daily activities of any offices. Earlier, Upendra Bahadur Karki – on the behalf of a microfinance institution ‘NADEP Laghubitta Bittiya Sanstha’ – had filed a writ petition against the employees' organisation NADEP Laghubittiya Sanstha, at the Supreme Court, which has has called both sides – the writ petitioner and trade unions – for discussion on January 1.
The order also reads that protest inside banks is against the Essential Service Operation Act 2014, which has kept banking sector as a sector that provides essential service to the public. “Banking sector comes under essential service provider,” the order reads, adding that no one should organise activities that directly affect operation of a bank and its service.

Substantial contribution of reconstruction in economy

Reconstruction has increased 4.5 percentage point contribution to GDP, according to a study.
According to a preliminary report ‘Impact of Post-Earthquake Reconstruction on Nepalese Economy’, jointly prepared by the National Reconstruction Authority (NRA) and the Society of Economic Journalists Nepal (Sejon), public and private spending on post-earthquake reconstruction helped increase 4.5 percentage points to the economic growth rate.
It means the casual impact of reconstruction ‘contributed’ 7x0.045 = 0.32 per cent growth in annual GDP, assuming 7 per cent annual GDP growth rate.
The report – supported by the National Democratic Institute for International Affairs (NDIIA) and the United States Agency for International Development (USAID) – also claimed that the reconstruction activities in the aftermath of the 2015 devastating earthquakes also generated 1.42 million jobs.
Economist and lead author Nirmal Kumar Raut, while presenting the report today, said that around 550,000 people were engaged in reconstruction work in the current fiscal year alone. “The study also reveals that housing reconstruction alone created jobs equal to 255 million man days which is equivalent to 1.42 million people being employed by the end of fiscal 2017-18. “Currently, some 0.55 million people are working in reconstruction of houses with jobs equal to 100 million work days being created indicating that the construction industry has been the largest employer in recent periods.”
Roughly speaking, about 7 per cent of the total employment in 2017-18 was created from the reconstruction of destroyed, damaged infrastructure alone, according to the report. “This is also a lower bound estimate of the total employment in the reconstruction work because this calculation is based only on a basic structure of house proposed among others and also this excludes the employment in the reconstruction of public infrastructure.”
Nepal was struck by two devastating earthquakes of magnitudes 7.8 and 7.3 on April 25 and May 12, respectively, killing some 8,790 people and injuring 22,300. The economic loss was estimated at $7 billion, out of which 76 per cent was in the private sector. The economic growth rate plunged to 2.97 per cent in the fiscal year 2014-15 – following the disaster – decelerated further to a record low of 0.2 per cent in the fiscal year 2015-16.
After the devastating earthquake, lots of reconstruction activities picked up creating employment and helping economic activities to push the economic growth. The Nepali economy grew by 7.74 per cent in the fiscal year 2016-17, the highest growth rate since the fiscal year 1993-94. Likewise, in the fiscal year 2017-18, the economy grew by 6.3 per cent, according to the Central Bureau of Statistics (CBS).
The report also claims that reconstruction work alone contributed most to the economic growth rate.
The report used two different approaches – one contribution of the construction industry to the GDP and second econometric model – to analyse.
The first inference was drawn from the contribution of the construction industry to the GDP vis-à-vis other major industries before and after the earthquake, Raut said, adding that the second inference was made by exploiting an econometric model. “An econometric model is one of the tools economists use to forecast developments in the economy.”
The econometric model also measures past relationships among such variables as consumer spending, household income, and employment, among others, and then forecasts how changes in some variables will affect future development, though some of the economists do not buy the result of the report.
“An average 4.5 per cent growth contribution by the reconstruction drive alone is not possible,” a former member of the National Planning Commission (NPC) Govinda Nepal said, adding that there are no substantial bases to claim that reconstruction activities fuelled a growth of 4.5 per cent, even though it has contributed significantly to revitalising the economy.
Nepal also said there is a need to conduct a comprehensive study on how reconstruction activities contributed to the economy before making such a large claim.
The government – in the fiscal year 2015-16 – spent Rs 21 billion on reconstruction, and in the next fiscal year 2016-17 – it spent Rs 27 billion. But in the past four fiscal year years, the government spent a total of Rs 450 billion – with most of the spending taking place in the last two fiscal year – which gives ample ground to conclude that the 4.5 per cent contribution – from fiscal year 2015-16 to fiscal 2017-18 – to the economy by the reconstruction drive is just not possible, Nepal added.
However, the outcome is construed as a lower bound estimate of the effects of reconstruction on economic growth owing to the limitations in the availability of data of other major variables and confounding effects of the 2015 blockade, natural shocks and other concurring adversities such as border blockade, the report explains. “Of the four major sectors--agriculture, manufacturing, whole and retails and construction, the share of only the construction sector in the economy expanded while share of other three sectors decreased.”
Chief executive officer (CEO) of the National Reconstruction Authority (NRA) Sushil Gyewali, on the occasion, said that the employment generated by the reconstruction drive looks realistic though there is a need for more research to find out the actual contribution of reconstruction activities to the economy. “Whatever growth there was did not just come from the government’s investment only,” he said, adding that the government invested only Rs 150 billion in the housing sector and the private sector poured in Rs 600 billion to build homes. “As Nepal’s reconstruction used local materials and resources, most of the money did not go outside the country supporting the grassroots level the most.”
Reconstruction also imparted skills to many Nepalis, mostly benefitting women, and increased financial inclusion with about 770,000 new bank accounts opened, some 30 per cent by women, the report reads, adding that – according to the NRA data – as many as 482,323 beneficiaries, out of the total 816,560, have rebuilt their houses. “As many as 56,382 beneficiaries have received construction completion certificates.”
A total of 769,926 households have received the first tranche of the government grant with 621,449 beneficiaries receiving the second tranche too, the NRA data reveals, adding that a total of 525,233 have received the third installment of government assistance. “The government provides Rs 300,000 for homeowners, whose homes were completely damaged and have no other home.”
The reconstruction of some 5,063 public schools, some 25,128 school rooms, some 665 health institutes, some 380 archaeological sites, some 311 government buildings and some 165 buildings of security agencies has also been over, according to the NRA.

MCC deal will be endorsed in winter session: Foreign Affairs Minister

The current winter session of the parliament is going to endorse the Millennium Challenge Corporation (MCC) grant assistance agreement.
According to foreign minister Pradeep Kumar Gyawali, the agreement with the US government will endorse the largest grant agreement related to the economic development of Nepal in the current session. “The then government led by the Nepali Congress had reached the agreement and as the government is an institution with unbroken inheritance rights there is no alternative to passing it even to enhance the credibility of the country's image in the international sector,” he said, clarifying about the MCC agreement in the National Concerns and Coordination Committee meeting – under the National Assembly – here today.
“As all the national parties have no differences regarding the MCC, it will be passed by the parliament,” Gyawali added.
After some of the standing committee members of the ruling Nepal Communist Party (NCP) raised serious concern over the MCC agreement’s link to the Asia Pacific Strategy (IPS), a debate has been started either to endorse it or not.
“MCC and IPS are different things,” he said, adding that it is not necessary to relate them together.
Claiming that the incumbent government is alert and serious regarding issues of national interest and concern, he said that doubt regarding the MCC is because of historic mistakes. “This is an agreement related to assistance by the American government in projects for the infrastructure development,” he said, adding that the conditions in the agreement, which have to be considered at the time of its signing, cannot be changed now. “The US assistance, following the successful peace process and achievement of political stability in Nepal, will give the country benefit of positive message worth billions.”
According to him, an independent and professional body has been set up in Nepal for the implementation of the MCC assistance and Nepal's authorised entity can audit its account too. A project worth $64 billion, including around $55 billion US assistance, has been pursued with the objective of developing physical infrastructure and expanding connectivity for eliminating poverty and backwardness in the Asia Pacific Region.
Nepal is – under the project – constructing a 400 kV electricity transmission line from Nanglebhare of Kathmandu to Butwal via Ratmate of Nuwakot and Tanahu, apart from, some road networks of strategic importance.

Gold price up by Rs 600 per tola

The price of gold increased by Rs 600 per tola (11.664 grams) and traded at Rs 72,800 per tola today at the domestic market.
Gold was available for Rs 72,200 yesterday, a rise of Rs 300 per tola compared to Monday, according to the Federation of Nepal Gold and Silver Dealers' Associations (Fenegosida).
The gold price climbed to a record high of Rs 73,500 per tola on September 4. Before July, gold price hovered around Rs 60,000 per tola, and in last 6 months, the price has gone up by 13,000 per tola, the association informed.

Tuesday, December 24, 2019

Government awards Fitch Ratings for Nepal’s sovereign credit rating

Fitch Ratings is going to start conducting the sovereign credit rating of Nepal soon. The government has picked American rating agency so that it can help pave the way to assess the creditworthiness of Nepal.
Revenue secretary Shishir Kumar Dhungana confirmed that the government has decided to select Fitch Ratings to determine the creditworthiness and risk assessment of the country. Nepal has been unable to attract more foreign direct investment (FDI) also due to lack of country ratings.
The country credit rating will not only provide foreign investors insights into the level of risk associated with investment but also help the government access capital from the international market on the basis of its creditworthiness as the sovereign credit rating determines the trustworthiness of the business environment and credit risk of a potential debtor, an individual, company, business, government or any other sovereign entity. The rating also gives potential investors an insight into the level of risk while investing in a country and takes into account political, social and financial risks. Risk ranking of a country is the primary factor that the potential investors look at before investing in any country.
Though, Moody’s Investor Services and Standard and Poor’s were also eyeing Nepal’s ratings, the Finance Ministry chose Fitch Ratings for the sovereign credit rating due to its technical and financial proposal,” he said, adding that the global credit rating agency will provide report and rating within 2 months after the signing of an agreement, if it gets all the necessary documents and information. “But it will take nearly 1 month to carry out homework before the ministry sign the agreement with Fitch Ratings.”
According to him Nepal will have sovereign credit ratings within 12 weeks. “Credit rating not only helps foreign investors measure the risk of the country either to invest or issue credit to it, but also provides an opportunity to review the progress and shortcomings in various aspects of the economy,” he said, adding that it will also put pressure on government to carry out necessary reforms to make sure Nepal will have better credit rating. Fitch Ratings conducts the credit rating of a country based on its macroeconomic, structural and governance indicators.
While assigning a rating, which can stretch from ‘AAA’ at the top – high quality – to D – defaulted – Fitch Ratings factors in various indicators like inflation rate, economic growth, foreign direct investment and external debt.
Fitch Ratings will carry out works related to the sovereign rating – to gauge Nepal’s credit worthiness – in coordination with the Department for International Development (DfID), United Kingdom. 

Central bank fixes debt service to gross income ratio at 50 per cent

The central bank has fixed the debt service to gross income ratio for individual borrowers for non-commercial loans.
Issuing a circular today to the banks and financial institutions (BFIs), the central bank has fixed 50 per cent of debt service to gross income ratio for personal loans, housing loans and hire purchase loans.
According to the circular, the BFIs must now factor in regular income of borrowers, while floating personal-type loans, housing loans and hire purchase loans. “A BFI will have to float loan amount within a limit that does not exceed the borrower's 50 per cent of gross income for non-commercial loans like personal loans, hire purchase financing and home loans.”
Though BFIs also consider the income source of their borrowers to ascertain repayment capacity while processing loan applications, the value and quality of collateral has been the major factor that forms the basis of loan disbursement decision. But the new rule will bars banking institution to float loans whose repayment installment amount is higher than the borrower's 50 per cent gross income, according to the bankers. “The borrowers, who want to buy home or car from loan must have to present their certificate of income along with tax clearance certificate to the BFIs,” the bankers said, adding that a borrower must have a gross salary of Rs 50,000 per month, otherwise the one will not be able to get home loan with monthly installment of more than Rs 25,000 per month, irrespective of the value of the collateral. Though, the banks have their own rule while considering the regular income for such loans, the central bank’s new move made them to fix the maximum ratio will restrict them to float loans whose installment does not cross the limit. The central bank circular reads that if any bank floats loans higher than the ratio, it must classify such loan as loans under 'watch list' and must provision 5 per cent of such loan as losses.
As of mid-November, the BFIs have floated Rs 248.4 billion residential personal home loans – up to Rs 15 million each – and Rs 182.94 billion hire purchase loans, according to the central bank data.

Monday, December 23, 2019

Nepal Police arrest 122 Chinese nationals suspected of cyber crime

Nepal Police today held some 122 Chinese nationals, who entered Nepal on tourist and student visas, on suspicion of their involvement in cyber and financial crime.
They were arrested from seven private residences – some 3 in Manamaiju and 2 each in Bansbari and Budhanilkantha – today. Police also confiscated a large number of laptops and mobile phones from their apartments, Central Investigation Bureau (CIB) under Nepal Police confirmed.
The operation was conducted by the CIB in coordination with Metropolitan Crime Division-Teku, Metropolitan Police Range-Teku, Metropolitan Police Office-Rani Pokhari and the Police Headquarters, the CIB said, adding that it is not known whether these Chinese nationals had valid visas to stay in Nepal or were overstaying.
The CIB is expecting to find out what exactly the Chinese nationals were doing in their rented apartments. “They were living secluded lives in rented apartments, which looked like offices,” the CIB said, adding that they also possessed special identity cards. “Anyone, who wanted to enter their apartments had to produce the IDs, which raised the eyebrows of police.”
The police said that they were arrested after monitoring their activities for few days using ‘urgent arrest warrants’, which allows police to detain suspects for up to 24 hours.
According to the CIB, most of the arrested Chinese nationals had visited Nepal on tourist visas but they were not engaged in touristic activities. “Some of them had also arrived in Nepal on student visas.”
Earlier, almost four months ago, police arrested some 6 Chinese nationals in connection with the the cyber heist in the banking sector, which saw illegal withdrawal of at least Rs 35.8 million from ATMs in Nepal and India.

Entries for PROstyle Manhunt International Nepal 2020 start

PROstyle – male grooming range from Dabur Nepal – has signed a Memorandum of Understanding (MoU) with Group of Event Entertainer (GEE) for the title sponsorship of PROstyle Manhunt International 2020.
PROstyle, together with Group of Event Entertainer (GEE), announced that entries for the PROstyle Manhunt International Nepal have been opened amidst an event organised today. It will be the seventh consecutive year that PROstyle is partnering with GEE to proudly host PROstyle Manhunt International Nepal for the year 2020.
Nepalis, who want to participate in the pageant are invited to download the form, view complete details, rules and regulations by logging into the Manhunt International Nepal Facebook page. The applicants must be men – aged 18 to 34 – have a minimum of 5' 8" height and at least intermediate passed. The grand finale of the contest will be held in March 2020 in Kathmandu. The winner of the contest will be representing Nepal globally in Manhunt International 2021 and first and second place winners shall represent Nepal in Mister International and Mister Global respectively.
“We as Dabur Nepal has been partnering with GEE for many years now to host this event,” head of Sales and Marketing at the Dabur Nepal Upendra Pradhan said, adding that it gives the company immense pleasure to see the leap that we have taken from then till now. “PROstyle is the male grooming range from Dabur Nepal, which helps one to look stylish, cool and confident.”
PROstyle Manhunt International Nepal 2019 winner Bibesh Shrestha was also bid adieu amidst the event. He’ll be leaving off to Philippines on February 2020 to represent the country at Manhunt International 2020. First Place winner of PROstyle Manhunt International Nepal 2019 Prashant Jung Shah has already represented Nepal in Mister International that took place in 2019 in Philippines, while Second Place winner Aryan Sitoula represented the country globally in Mister Globalheld in Thailand.
PROstyle is a unique product, the first of its kind. It is the only hair oil ever developed for men in Nepal addressing the specific needs of the male users. PROstyle now has PROstyle Dandruff Control Hair Oil, PROstyle Soft and Shiny Hair Oil and PROstyle hair cream under the brand and are available in different pack sizes. PROstyle has a refreshing perfume and helps one look stylish, cool and confident and it is available in a masculine pack, claims the company.

Compliances, fines hurt innovative business practice

Through the multiplicity of compliance and vast number of fines imposed, smooth and efficient operation of an enterprise is a distant dream in Nepal. In the wake of such inadequacies and bottlenecks pertinent to innovative businesses, regulators and the regulated today discussed on ‘Facilitating Innovative Business Practices in Nepal’ to find out possible future steps that can be helpful to both the parties.
In the interaction organised by Samriddhi Foundation the participants highlighted that innovation in entrepreneurial ventures ultimately helps the economy but Nepal’s arcane laws either prohibit innovative practices like mobile businesses or ride sharing businesses or to a certain degree fail to create an environment for such businesses to prosper.
National Governing Council Member of the Nepalese Young Entrepreneur Forum (NYEF) Nivita Pradhan, on the occasion, voiced concern about finance as one of the major challenges that Nepali start-ups face.  She went on to explain how potential entrepreneurs lack assets for collateral to acquire loan at banks. Pradhan also stressed on lack of substantial research, policy irregularities, and lack of a one-stop mechanism for ecosystem players as few among the many reasons why the failure rate of startups is so high in Nepal.
“Start-up is a word that has been used, misused and abused as it is subject to one’s individual approach; hence, it is important that the government, legislature and the judiciary understand its definition and potential,” said Founder of Tootle Sixit Bhatta. He also stated how Tootle has protected the country and its people from economic shocks as everyone, ranging from professionals, students to homemakers, can become riders and use the platform as a transitional job involvement.
The session that began with a presentation by a researcher at Samriddhi Foundation Yatindra KC by giving a brief overview on the areas that require considerable scrutiny so as to propel entrepreneurial growth in Nepal, also witnessed advocate and partner at the Abhinawa Law Chambers Semanta Dahal, who used a rather philosophical and a thought-provoking approach to explain the need for innovation in the country. He stated that law can never catch up with the pace of technology, therefore, it is for us to ponder up if law should choke or cope with such changes.
“When you have paternalistic policies, the government’s role is going to be controlling,” Bhatta said, adding that we, however, need policies nudge people towards desirable outcome, rather than punish undesirable outcome. “Our policies need to be libertarian paternalistic.”
Pointing out the need to change the pattern of the existing notion of policy making and implementation and he said strongly believes that libertarian policies will better guide the society.
The participants, on the occasion, were also curious to know the imposed challenges and the support mechanisms in part of the government. In response to the queries, it was cited that that the country’s ever-changing laws and lack of awareness to make deliverables poses a recurring challenge. To tackle this gap of knowledge, an up to date research must be done and data reservoir created so that the government can keep track of the pace of the innovative industries and the entrepreneurs can keep themselves updated.
One of the panelists, chief executive officer of Health at Home Bishal Dhakal said that the laws exist in order to facilitate the young and vibrant ideas but apart from what the government is doing to facilitate the startup ecosystem, private individuals also need to be professional. “We as individuals also need to be proactive,” he said, adding that it is agreeable that changes are conceivable when everyone is liable to their duty; as policy makers or as policy drivers.

Nepal calls for tourism and investment promotion

Nepali ambassador to India Nilambar Acharya called for tourism and investment promotion in Nepal and further strengthening of India-Nepal economic relations.
Delivering a keynote speech at the ‘Visit Nepal 2020 Conclave’, organised by PHD Chamber of Commerce and Industry (PHDCCI) under aegis of its India-Nepal Centre / SDC and in association with the Embassy of Nepal, today at Bengaluru in India, he called for promoting tourism to make the Visit Nepal 2020 (VNY2020) a grand success.
Nepal is observing Visit Nepal Year 2020 aiming at hosting 2 million tourists. The conclave hosted the official launch of Nepal’s ‘Visit Nepal 2020 Campaign’ and discussed with key decision-makers’ and stakeholders’ from the government and industry, for positioning ‘Visit Nepal 2020’ to attract the visitors and investments from Southern India to Nepal.
Likewise, the chair of inaugural session former Indian ambassador to Nepal and chairman at the India-Nepal Centre under PHDCCI, K V Rajan highlighted the importance of tourism as a major sector for Nepal, both keeping economic and socio-cultural considerations. “Endowed with favourable natural conditions, the tourism in Nepal is all set to gain new height with Visit Nepal 2020, a meaningful campaign started by Nepal,” he added.
The two sessions and roundtable meeting hosted the voices of the policy-makers from the government and industry in Southern India, where they tried to explore the trade and investment opportunities with focus on tourism in Nepal.
The vision for ‘Visit Nepal 2020’ campaign is grand and reflects Nepal’s unwavering commitment to improving its competitiveness through investment, innovation, infrastructure development, regulatory reforms, new product offering, environment and wildlife conservation, and ensuring greater level of efficiency in service standards with the aim to develop tourism and economy in Nepal. Significantly, the government declared 2020 as the Visit Nepal Year with a goal to achieve 2 million arrivals and daily spending of tourists to over $75.
Remarkably, ‘Visit Nepal 2020 Campaign’ is being positioned as a ‘Lifetime Experience’ in a bid to establish Nepal and one of the world’s most unique experimental and lifetime value destinations. According to the government estimate, in 2018 Nepal received some 11,73,072 international tourists excluding domestic travelers. Among the tourists, the numbers of Indian travels were the highest. Likewise, the share of total Foreign Direct Investment (FDI) in tourism stood at 11.47 per cent at Rs 23,855.50 million in 2018.
The hospitality sector has shown immense promise with several international hotel chains having already entered or in the process of entering the market.
The Visit Nepal Year 2020 is set to achieve the government agenda to recognise and accelerate the development of the potential of the tourism industry in the years to come even as the government creates ease of doing business for investors’ and stakeholders’ with incentives and subsidy provisions, supportive policies, political stability and sound governance.
On the occasion, PHDCCI – through its 1,30,00 members – and through its counterparts including Federation of Karnataka Chamber of Commerce and India (FKCCI), Bangalore Chamber of Industry and Commerce (BCIC),  India Association of Tour Operators (IATO), Travel Agents Association of India (TAII) and South India Hotel and Restaurant Association (SIHRA), ensured an outreach to over half-million industry entities.
On the occasion, economic minister at the Embassy of Nepal in New Delhi Nita Pokhrel Aryal, economic counselor at the Embassy of Nepal in New Delhi Tirtha Poudel, director at the Department of Tourism in Government of Karnataka K N Ramesh, managing director of the Nepal SBI Bank Anukool Bhatnagar, president of the Federation of Karnataka Chamber of Commerce and Industry (FKCCI) C R Janardhana,  president of Bangalore Chamber of Industry and Commerce (BCIC) Devesh Agarwal, chairman of Karnataka State Chapter of India Association of Tour Operators (IATO) S Mahalingaiah, honourary secretary of Travel Agents Association of India (TAAI) Niranjan S Bhargava, and executive director at the Interstate Multi-Modal Transport (Pvt) Ltd Bikas Rauniyar, principal director at the PHDCCI Dr Ranjeet Mehta, and deputy secretary and Nodal Coordinator at the SDC/India-Nepal Centre Atul Kumar Thakur also took active part in the discussions.

Sunday, December 22, 2019

MCA-Nepal appeals for timely ratification of MCC Compact

The Millennium Challenge Account -Nepal (MCA-Nepal) has appealed for timely ratification of the Millennium Challenge Corporation (MCC) Compact by the Federal Parliament, as opposition has been growing from the ruling party members against the MCC.
Organising a press conference to brief media today, MCA-Nepal has also clarified that a condition of ratification of the agreement for the grant of $500 million from the MCC Compact by the Nepali Parliament is a 'standard norm' used by the MCC to ensure that projects implemented under their support do not face any problems later due to other laws. In addition to the US grant, the government will chip in $130 million for implementation of the Compact.
“The Compact has outlined six Conditions Precedent (CPs) to be achieved as necessary prerequisites before the ‘Entry Into Force’ (EiF), set for June 30,” executive director of MCA-Nepal Khadga Bahadur Bisht said, adding that out of the six, four – Designating Electricity Transmission Project as a national pride project, signing of the project implementation agreement, drafting of Electricity Regulatory Commission Act and forming the commission, agreement between Nepal and India for cross-border transmission line (Butwal-Gorakhpur) – have already been met.
The EiF by June 30 is considered to be very important for Nepal because if the programme enters into force, all projects must be completed within five years. MCA-Nepal – an agency formed by the government to implement and manage programmes financed by the MCC – says that all compact-related works that are incomplete at the end of the five-year timeline will not be funded by MCC or unutilised funds will return to the US.
“The MCC needs to be ratified by the Parliament before the access to site – the two major remaining conditions – that will be required to ensure Nepal can access the funds allocated to implement the programme on time,” Bisht said, adding that the MCC- Nepal programme has identified projects under two headings – high-voltage transmission lines and road maintenance – which need to be completed by June 29, 2025.
The project will construct 312-km-long 400 kVA high-voltage transmission lines and three high capacity substations, including building 856 transmission line towers across the alignment, according to the MCA-Nepal. The transmission line will pass through 30 municipalities of 10 districts. The locations for three substations are in Ratmate, Damauli and New Butwal.
Likewise, the programme will build different road projects with a total length of 100 kilometres.
The projects will be implemented through the use of cutting-edge technology from United States.
The Road Maintenance Project aims to enhance current practices in the maintenance of Nepal’s strategic roads network and will provide technical assistance to the Department of Roads (DoR) and Roads Board Nepal. Maintenance interventions will include pavement improvement techniques and safety enhancement features. New pavement improvement technology adopted is Full Depth Recycling (FDR) and Superpave asphalt concrete which follows the principle of recycling existing pavement material.
Organising a press conference to brief media today, Bisht said that MCA-Nepal is in the final stage of preparatory works required for the implementation of its projects that aim to increase the availability and reliability of electricity, maintain road quality and facilitate power trade between Nepal and the region to help encourage investments. But, Bisht further said, the Parliamentarians or anyone has the right to raise questions regarding the project without trying to obstruct the project on any condition as it is not good for its timely implementation. “We will like to assure that MCA-Nepal is ready to hold necessary discussions regarding the project implementation with all the concerned stakeholders,” he said, adding that the condition is in line with the standard format of the MCC compacts. “Seventeen other countries, where compact is implemented also ratify the agreement.”
As the government is preparing to table the agreement for ratification in the ongoing session of Parliament, some ruling Nepal Communist Party (NCP) leaders have started criticising the MCC Compact, particularly the condition of the ratification, and also the provision that Nepal cannot audit the project. Bisht, however, said that there is not any clause in the agreement that bars auditing of the projects under this compact by the Office of Auditor General (OAG).
Speaking on the occasion, alternative board member of MCA-Nepal Gyanendra Lal Pradhan said that the Federal Parliament should ratify the project and pave the way to take forward the project as soon as possible. “According to the understanding of Vienna Convention, any development partner has the right to ‘change in law’ protection for any future uncertainty,” her said, adding, “If any political party’s leader obstructs the project implementation, we should stand against them.”

Ncell gets two-week ultimatum to pay CGT dues

The Large Taxpayers Office today gave an ultimatum to Ncell to clear its outstanding capital gains tax (CGT) dues within 15 days.
The LTO’s ultimatum to Ncell to clear the dues came on the same day that the tax office received an official letter from an international investment dispute settlement court asking it not to initiate CGT collection process from Ncell.
Issuing an interim order last week, the International Centre for Settlement of Investment Disputes (ICISD) had directed Nepal not to ‘take any steps’ to enforce its decision to collect Rs 22.4 billion in outstanding CGT – including interest and penalties – from the sale of Ncell by TeliaSonera Norway to Axiata UK. The LTO officially received ICSID’s order today, confirmed the LTO officials. Though LTO claimed thagt it will discuss about the ICSID’s letter with the government, it has – contrary to ICSID’s directive – directed Ncell to clear the outstanding CGT dues within two weeks.
Based on the verdict of the Supreme Court, the LTO had asked Ncell to deposit Rs 22.44 billion remaining CGT dues within 15 days on December 8. However, Ncell did not clear its dues within the given time forcing the LTO today to give ultimatum to deposit Rs 22.6 billion tax dues – including interest and late fees – to telecom service provider.
The government will take necessary action on the basis of the Income Tax Act, if Ncell fails to clear dues within the time, the letter reads, adding that the LTO will take action based on provisions mentioned from Section 104 to 109 of the Income Tax Act.
However, experts said that the interim order issued by ICSID is obligatory for countries that are its members based on previous tribunals.

Red tape, auditing malpractice major causes of corruption

The Commission for the Investigation of Abuse of Authority (CIAA) has filed 206 cases against individuals for their alleged involved in corruption and irregularities in the first five months of the current fiscal year 2019-20.
As the country is implementing the federal system, there is a rise in the misappropriation of the state fund, reveals a survey report 'Study on Corruption and Good Governance in Nepal-2018' released last year. “During the period, the anti-graft body carried out 94 sting operations,” it reads, adding that the anti-graft body has registered 351 cases at the Special Court, the highest number in the history of the CIAA, in the last fiscal year, whereas it had conducted some 142 sting operations – also a record high – bringing 200 public officials to book.
Speaking at an event organised by the Institute of Chartered Accountants of Nepal (ICAN) today, the CIAA chief commissioner Nabin Kumar Ghimire said that corruption cases have been on the rise, mainly at the local government level. “The commission has started rigorous watch on officials at the local units.”
The survey report also reveals that only land revenue offices are more corrupt than local units. “Most of the complaints are related to quantity and quality of supplied goods, substandard construction, awarding contracts without following due procedures, budget misappropriation, illegal mining of aggregate, distribution of social security allowance, and misuse of office facilities.”
The participants though stressed on poor auditing process and fraudulent financial reporting as the reasons behind corruption, Ghimire sought effective role of chartered accountants (CAs) to check the cases of financial misappropriations in public offices.
The Corruption Perception Index 2019 released by the Transparency International (TI) also reveals that Nepal's position fell two notches to 124 in 2018.
Business leaders, on the occasion, also expressed concern over the expanding shadow economy and falling quality of development work due to increasing corruption, which has also increased cost of doing business.

India builds girls hostel building for APF

The girls Hostel Building for Nepal Armed Police Force (APF) School at Kirtipur in Kathmandu has been inaugurated today by deputy chief of mission at the Indian Embassy in Kathmandu Dr Ajay Kumar, mayor of Kirtipur Minicipality Ramesh Maharjan, deputy mayor of Kirtipur Municipality Saraswoti Khadka, Assistant Inspector General (AIG) of APF Ramsharan Paudel alongwith the political, community leaders.
APF School is an academic institution created under APF Welfare Service Centre of Nepal Armed Police Force. The school was established in 2005. It is located at Champadevi-7 of Kirtipur Municipality in Kathmandu. The school has over 21 per cent of girls students. The project was implemented by APF.
The new infrastructure constructed with the Indian grant assistance of Rs 40.42 million, is a two storied girls hostel building comprising 32 rooms, including dormitory and one room for warden, bathroom, sanitation facilities for girls on each floor and furniture, according to a press note issued by the Indian Embassy in Kathmandu.
Indian government is happy to be associated with the project which compliments effort of Nepal government in augmenting infrastructure in the field of education, the press note reads, adding that the newly built infrastructure is expected to boost learning environment of students.