By the end of Baishakh (mid-April to mid March) -- the 10th month of the current fiscal year -- the finance ministry collected a total of Rs 110.51 billion revenue, surpassing its target of Rs 103.5 billion for the month.During the corresponding period last fiscal year, it was able to collect Rs 79 billion. "Revenue collection exceeded 40 per cent in comparison to last fiscal's same period," according to the finance ministry. At the end of the ninth month, revenue collection exceeded its own target collecting 39.3 per cent higher to Rs 98.67 billion as against Rs 70.85 billion last Chaitra.
The encouraging collection of revenue is attributed to three major reasons: priority of the finance ministry to revenue mobilisation, fear in the business community of the Maoist leadership and the alacrity of the leadership itself.
"The seriousness of leadership -- both political and bureaucratic, reduction in malpractices and discrepancies and the good relationship between the government and private sector helped us achieve target," said acting revenue secretary Krishna Hari Baskota.Finance Minister Dr Bhattarai presented his first budget of Rs 236.15 billion for the fiscal year 2008-09 on September 19 last year. The revenue target that he had set for this fiscal year was Rs 147.72 billion, and which was dubbed highly ambitious.
Dr Bhattarai when was criticised that his target was too ambitious but he took it as a challenge and concentrated on revenue collection. The bureaucracy -- blamed for being over-politicised and lackadaisical -- also supported him whole-heartedly.Willingly or unwillingly, the business community also cooperated with the government. Though Dr Bhattarai does not agree that the government and private sector had any crisis of confidence, there was definitely a certain level of uneasiness between the business community and the government. But like good citizens, the private sector obeyed the government and came under VDIS, helping the government to increase revenue collection and exceed the revenue target.
The issue of revenue mobilisation has been a serious concern for past governments as well. Realising the importance of revenue mobilisation, the government after second Jan Andolan appointed a separate revenue secretary in 2006 August. "In the immediate past year, revenue growth was only three per cent and nine per cent a year ago," finance secretary Rameshwor Khanal, who was the first incumbent in the post, said adding that the government then was serious about revenue mobilisation and that is why it thought of appointing a separate full-time secretary for revenue.
"Successive finance ministers gave top priority to revenue collection," Baskota said adding that reduction of corruption in customs, a stronger bureaucracy and changed tax system worked miracles in achieving record revenue generation.Dr Bhattarai, as he himself claims, has a reason to be satisfied as he was successful in bringing more people within the tax net through VDIS. "Of the 3600 who came under VDIS, 60 per cent are new entrants," Baskota said. "The older 40 per cent ones also expanded their base."
"The finance ministry went the extra mile and worked hard for forming a separate desk for separate types of taxes like excise desk, income tax desk and customs desk," he said adding that the systematisation of tax and regular follow-up not only helped revenue collection for this government but would also have long-term benefits for successive governments.
Though, the contribution of non-tax revenue to the total revenue is 70 to 75 per cent, Value Added Tax (VAT) target could not be achieved in comparison to income tax and excise.However, the government failed in spending on development activities as finance ministry's task is not only to collect revenue. Dr Bhattarai accepted the failure in development spending but he also blamed the other political parties for not being able to spend the development budget. The cold behaviour of the coalition partners took its toll on development spendings. "In absence of local government, the budget could not be spent on development activities," he said adding that the other ministries also did not whole-heartedly support the finance ministry.
Showing posts with label Finance Minsiter Dr Baburam Bhattarai. Show all posts
Showing posts with label Finance Minsiter Dr Baburam Bhattarai. Show all posts
Thursday, May 21, 2009
Monday, May 18, 2009
Record revenue collected
The government has been blamed for not being able to spend on development activities, but it has exceeded its own target and set another record in revenue collection.
By end of Baishakh (mid-April to mid March) -- the 10th month of this fiscal year -- the finance ministry has collected Rs 110.51 billion, surpassing its target for the month that was Rs 103.5 billion.
During the same period last fiscal year, the government was able to collect Rs 79 billion. "Revenue collection exceeded 40 per cent in comparison to the last fiscal year's same period," according to the finance ministry. At the end of ninth month, the revenue collection target has exceeded its own target and collected 39.3 per cent higher revenue up to Rs 98.67 billion against Rs 70.85 billion collected last Chaitra.
When finance minister Dr Baburam Bhattarai presented his first budget of Rs 236.15 billion for the fiscal year 2008-09 on September 19, the revenue target of the budget was termed ambitious. He had set a revenue target of Rs 147.72 billion.
The encouraging collection of revenue is attributed the rise in revenue collection to the seriousness of the leadership, reduction in malpractices and discrepancies, and the good relationship between the government and private sector.
By end of Baishakh (mid-April to mid March) -- the 10th month of this fiscal year -- the finance ministry has collected Rs 110.51 billion, surpassing its target for the month that was Rs 103.5 billion.
During the same period last fiscal year, the government was able to collect Rs 79 billion. "Revenue collection exceeded 40 per cent in comparison to the last fiscal year's same period," according to the finance ministry. At the end of ninth month, the revenue collection target has exceeded its own target and collected 39.3 per cent higher revenue up to Rs 98.67 billion against Rs 70.85 billion collected last Chaitra.
When finance minister Dr Baburam Bhattarai presented his first budget of Rs 236.15 billion for the fiscal year 2008-09 on September 19, the revenue target of the budget was termed ambitious. He had set a revenue target of Rs 147.72 billion.
The encouraging collection of revenue is attributed the rise in revenue collection to the seriousness of the leadership, reduction in malpractices and discrepancies, and the good relationship between the government and private sector.
Friday, March 13, 2009
Finance Minister holds mid-term review meet
The government has received seven Letters of Intent (LoI) for the feasibility study of East-West Electric Railway Project, Finance Minister Dr Baburam Bhattarai said here today during a mid-term review of the budget.
Dr Bhattarai admitted that the government had failed to achieve targetted growth, but he claimed that the growth would reach close to the target. He had set a target of seven per cent growth, but the Central Bureau of Static's (CBS) -- based on the first six months' data -- has reduced Gross Domestic Product (GDP) to 3.8 per cent for this fiscal year.
CBS also claimed that the price hike would stand at 12.15 per cent, contrary to Dr Bhattarai's promise to reduce it to 7.5 per cent. Inflation is at 14.4 per cent in the first six months of this fiscal year, according to the bureau.
The government is working to change the Income Tax Act according to the changed context. "A three-member committee led by Surya Nath Upadhayay has been formed to study and give suggestions on the changes in the present Income Tax Act," Dr Bhattarai said.
Though things look bleak, he painted a rosy picture of the economy. "All macroeconomic indicators are encouraging," he said. "Revenue collection is encouraging and we will meet the target." While presenting his first budget, he had predicted revenue target growth by 31.77 per cent. "The treasury is in a comfortable position at Rs 25 billion surplus and the economy is sound," he claimed.
He also presented a list of achievements like increment in minimum wage of labourers, Bill passed for the Investment Promotion Board, planning of cooperative shops in villages, starting of self-employment scheme and preparation of draft for holding companies' manual.
Dr Bhattarai admitted that the government had failed to achieve targetted growth, but he claimed that the growth would reach close to the target. He had set a target of seven per cent growth, but the Central Bureau of Static's (CBS) -- based on the first six months' data -- has reduced Gross Domestic Product (GDP) to 3.8 per cent for this fiscal year.
CBS also claimed that the price hike would stand at 12.15 per cent, contrary to Dr Bhattarai's promise to reduce it to 7.5 per cent. Inflation is at 14.4 per cent in the first six months of this fiscal year, according to the bureau.
The government is working to change the Income Tax Act according to the changed context. "A three-member committee led by Surya Nath Upadhayay has been formed to study and give suggestions on the changes in the present Income Tax Act," Dr Bhattarai said.
Though things look bleak, he painted a rosy picture of the economy. "All macroeconomic indicators are encouraging," he said. "Revenue collection is encouraging and we will meet the target." While presenting his first budget, he had predicted revenue target growth by 31.77 per cent. "The treasury is in a comfortable position at Rs 25 billion surplus and the economy is sound," he claimed.
He also presented a list of achievements like increment in minimum wage of labourers, Bill passed for the Investment Promotion Board, planning of cooperative shops in villages, starting of self-employment scheme and preparation of draft for holding companies' manual.
Monday, March 2, 2009
Finance Ministry organises NDF prepratory meeting
The Finance Ministry today held extensive discussions with representatives of Kathmandu-based foreign donor agencies and countriies at the ministry here as a preliminary preparation of the Nepal Development Forum (NDF) meeting that will be held on May 12-14 in Kathmandu.
Addressing donors, Finance Minister Dr Baburam Bhattarai said that peace, democracy and development would be the three major agenda of the government for the NDF meeting. “Without peace, there can be no development and without development there can be no peace,” said Dr Bhattarai.
At the meeting attended by representatives of donors including World Bank (WB), Asian Development Bank (ADB), DfID, IMF, DANIDA, India, China and Finland, he alsohighlighted his government’s foreign aid priorities. “The government will come up with realistically set up clear priorities of development for the coming three years before the NDF meet,” he assured them.
Dr Bhattarai urged the donors to set programmes based on Nepal’s priorities. “While preparing programmes at local levels, avoid the overlapping, duplication and fragmentation of aid,” the finance minister requested them adding that they should realise the constraints and acknowledge the realities of the transition phase in Nepal.
Stressing on Nepal’s transition period, he urged the representatives of Nepal’sdevelopment partners to adopt a ‘transitional sensitive approach’ to development needs rather than standard normal applicable approach.
On the occasion, the first finance minister of the youngest republic also gave a brief overview of the implementation of the current fiscal year budget. “The macro economic situation is sound and most of the indicators are satisfactory,” he said adding that revenue collection was exceeding the target.
Though he accepted the government’s failure in kickstarting development activities and making capital expenditure unsatisfactory, he claimed that the budget deficit was within the appropriate limit and that external assistance also was coming as committed. He voiced the hope that development activities would pick up in the later months of the fiscal year.
In the meeting, the donors appreciated the government’s efforts and Dr Guna Nidhi Sharma, vice-chairman of the National Planning Commission (NPC) — the national think-tank — also presented a paper. Finance Secretary Rameshwor Khanal also made a presentation before the donors. "The donors are very enthusiastic about the NDF preparations,” he said.
Dr Bhattarai informed donors that the next fiscal year’s budget would be presented by late May or early June. The budget is expected to be around Rs 263 billion. “Presenting the budget by late May or early June will give the government ample time to implement it,” he said.
Meanwhile, the secretaries under various ministries also briefed Dr Bhattarai today on the current state of budget implementation under their respective ministries. "The finance minister was satisfied with the briefing," said a source at the meeting adding that Dr Bhattarai also said that the people have been expecting a miraculous change from the government and it must deliver.
Addressing donors, Finance Minister Dr Baburam Bhattarai said that peace, democracy and development would be the three major agenda of the government for the NDF meeting. “Without peace, there can be no development and without development there can be no peace,” said Dr Bhattarai.
At the meeting attended by representatives of donors including World Bank (WB), Asian Development Bank (ADB), DfID, IMF, DANIDA, India, China and Finland, he alsohighlighted his government’s foreign aid priorities. “The government will come up with realistically set up clear priorities of development for the coming three years before the NDF meet,” he assured them.
Dr Bhattarai urged the donors to set programmes based on Nepal’s priorities. “While preparing programmes at local levels, avoid the overlapping, duplication and fragmentation of aid,” the finance minister requested them adding that they should realise the constraints and acknowledge the realities of the transition phase in Nepal.
Stressing on Nepal’s transition period, he urged the representatives of Nepal’sdevelopment partners to adopt a ‘transitional sensitive approach’ to development needs rather than standard normal applicable approach.
On the occasion, the first finance minister of the youngest republic also gave a brief overview of the implementation of the current fiscal year budget. “The macro economic situation is sound and most of the indicators are satisfactory,” he said adding that revenue collection was exceeding the target.
Though he accepted the government’s failure in kickstarting development activities and making capital expenditure unsatisfactory, he claimed that the budget deficit was within the appropriate limit and that external assistance also was coming as committed. He voiced the hope that development activities would pick up in the later months of the fiscal year.
In the meeting, the donors appreciated the government’s efforts and Dr Guna Nidhi Sharma, vice-chairman of the National Planning Commission (NPC) — the national think-tank — also presented a paper. Finance Secretary Rameshwor Khanal also made a presentation before the donors. "The donors are very enthusiastic about the NDF preparations,” he said.
Dr Bhattarai informed donors that the next fiscal year’s budget would be presented by late May or early June. The budget is expected to be around Rs 263 billion. “Presenting the budget by late May or early June will give the government ample time to implement it,” he said.
Meanwhile, the secretaries under various ministries also briefed Dr Bhattarai today on the current state of budget implementation under their respective ministries. "The finance minister was satisfied with the briefing," said a source at the meeting adding that Dr Bhattarai also said that the people have been expecting a miraculous change from the government and it must deliver.
Tuesday, December 16, 2008
Dr Bhattarai's sermon to senior officials
Finance Minister Dr Baburam Bhattarai today directed secretaries to be more result-oriented than process-oriented. "Bureaucracy should change its old mind-set and be more result-oriented," he said directing the secretaries today.
The first finance minister of the Democratic Republic of Nepal Bhattaria also requested the senior officials to complete the stipulated works within the set time frame for the better service delivery.
Though revenue collection -- that exceeding the target -- is satisfactory, the development expenditure is negligible, he reminded the bureaucrats. Out of the total expenditure, only Rs 47 billion -- that is only 22 per cent of the total allocation -- has been spent.
"The budget itself was announced late and if we donot seriously maintain the time frame, the allocated development expenditure would be wasted," one of the chief ideologues of the Maoist party that is leading the country said, adding that the budgetary allocation cannot be changed. He also showed dissatisfaction over the delay in passing the programmes from National Planning Commission. "The programmes should have been passed within October," the rebel-turned-minister said.
The finance secretary (revenue) Krishnahari Baskota presented the progress report of four government corporations -- Hetauda Kapada Uddhyog, Gorakhkali Rabar Udhyog, Biratnagar Jute Mill and Krishi Aujar Karkhana -- as the budget had planned to revamp them. He also apprised the meeting -- that will continue on Thursday also -- of Rs 500 million Self-Employment Programme and the finance ministry's take on proposed Infrastructure Development Bank.
Bhatta for law amendment
KATHMANDU: Lekhraj Bhatta, minister for Labour and Transport Management, speaking at a press meet organised by the ministry and Safe Migration on the occasion of 18th International Migration Day here today said the ministry was planning to amend the existing laws and regulations to utilize the remittance and curb the malpractices and fraudulent activities in the foreign employment. He also informed that a taskforce was being formed to effectively implement 10 per cent reservation scheme for the oppressed, suppressed, conflict victims and people from remote areas for the foreign employment. Although there is growing demand of women workers in international market, the government has banned them going to Malaysia and Saudi Arab, according to the National Network for Migration. "However, it is against the Foreign Employment Act- 2064 BS," they said. Bhatta said that tussle between industrialists and labour is evident but it should be resolved through dialogue. "Government is doing its best to help operate industries smoothly," he added.
The first finance minister of the Democratic Republic of Nepal Bhattaria also requested the senior officials to complete the stipulated works within the set time frame for the better service delivery.
Though revenue collection -- that exceeding the target -- is satisfactory, the development expenditure is negligible, he reminded the bureaucrats. Out of the total expenditure, only Rs 47 billion -- that is only 22 per cent of the total allocation -- has been spent.
"The budget itself was announced late and if we donot seriously maintain the time frame, the allocated development expenditure would be wasted," one of the chief ideologues of the Maoist party that is leading the country said, adding that the budgetary allocation cannot be changed. He also showed dissatisfaction over the delay in passing the programmes from National Planning Commission. "The programmes should have been passed within October," the rebel-turned-minister said.
The finance secretary (revenue) Krishnahari Baskota presented the progress report of four government corporations -- Hetauda Kapada Uddhyog, Gorakhkali Rabar Udhyog, Biratnagar Jute Mill and Krishi Aujar Karkhana -- as the budget had planned to revamp them. He also apprised the meeting -- that will continue on Thursday also -- of Rs 500 million Self-Employment Programme and the finance ministry's take on proposed Infrastructure Development Bank.
Bhatta for law amendment
KATHMANDU: Lekhraj Bhatta, minister for Labour and Transport Management, speaking at a press meet organised by the ministry and Safe Migration on the occasion of 18th International Migration Day here today said the ministry was planning to amend the existing laws and regulations to utilize the remittance and curb the malpractices and fraudulent activities in the foreign employment. He also informed that a taskforce was being formed to effectively implement 10 per cent reservation scheme for the oppressed, suppressed, conflict victims and people from remote areas for the foreign employment. Although there is growing demand of women workers in international market, the government has banned them going to Malaysia and Saudi Arab, according to the National Network for Migration. "However, it is against the Foreign Employment Act- 2064 BS," they said. Bhatta said that tussle between industrialists and labour is evident but it should be resolved through dialogue. "Government is doing its best to help operate industries smoothly," he added.
Saturday, December 6, 2008
Nepse shows abnormal behaviour
It happens only in Nepal. It has happened earlier also, when Maoists walked out of the government, Nepse gained.
And this time too, a week after Securities Board of Nepal (Sebon) chairman Dr Chiranjivi Nepal put in his papers, the Nepal Stock Exchange (Nepse) index gained 22.73 points to reach 754.91 points - from last week's closing of 732.18 points - giving a clue to long-suspected manipulation of the market. Under normal conditions, the market should plunged after the board chair went vacant.
All key market propellers - commercial banks, development banks, finance companies, hydropower companies gained, posting 741.85 points, 1137.28 points, 980.77 points and 950.23 points, respectively. Only the insurance company group ended in negative territory, shedding 11.78 points to tumble to 759.57 points.
The sensitive index - the barometer of group-A companies - also gained 3.92 points to climb to 198.48 points. The domination of group- A companies continued this week too as they contributed 77.30 per cent to the total amount transacted. Similarly, the float index - calculated on the basis of real transactions - rose by 0.99 points to reach 73.17 points.
Shareholders of Bank of Kathmandu, this week, gained the most as in terms of monetary value, Bank of Kathmandu (with Rs 88.43 million), Siddhartha Bank (with Rs 44.48 million), Standard Chartered Bank Nepal (with Rs 31.60 million) and Sanima Bikas Bank (with Rs 27.92 million) and Nepal Investment Bank (with Rs 23.07 million) were top scorers.
The market wound up in negative territory for three days in its five-day session. However, it opened in green on Sunday. Nepse gained 18.53 points that day and 15.05 points on Monday to rise to 761.67 points on Tuesday. However, it dipped on Wednesday and Thursday.
In terms of numbers of share units traded, Bank of Kathmandu topped the chart with 43,000-unit shares while in terms of number of transactions Prabhu Finance topped the chart with 421 transactions.
Narayani Finance, Annapurna Bikas Bank, International Leasing and Finance and Guheshwori Merchant and Finance listed their rights shares whereas Diprox Bikas Bank listed its 52,200-unit of bonus shares at Nepse.The government and other institutions' bonds and debentures could not generate public interest in the secondary market. Nepse did not witness any such transaction. Similar was the fate of Over The Counter (OTC) market that also has not seen a single transaction since it started a few months back.
New Sebon chief anytime soon
KATHMANDU: The Finance Ministry will appoint a new chairman of Sebon early this week, according to a ministry source. A retired bureaurocrat is tipped to be the most probable candidate for the post. The post went vacant when Dr Chiranjivi Nepal resigned the chairmanship citing 'no seriousness' on part of Finance Minister Dr Baburam Bhattarai towards developing the capital market. Meanwhile, the government also announced a vacancy for the post of Nepse's general manager. The incumbent general manager Rewat Bahadur Karki has got an extension after his tenure ended three months ago. Karki will stay until a successor is named.
And this time too, a week after Securities Board of Nepal (Sebon) chairman Dr Chiranjivi Nepal put in his papers, the Nepal Stock Exchange (Nepse) index gained 22.73 points to reach 754.91 points - from last week's closing of 732.18 points - giving a clue to long-suspected manipulation of the market. Under normal conditions, the market should plunged after the board chair went vacant.
All key market propellers - commercial banks, development banks, finance companies, hydropower companies gained, posting 741.85 points, 1137.28 points, 980.77 points and 950.23 points, respectively. Only the insurance company group ended in negative territory, shedding 11.78 points to tumble to 759.57 points.
The sensitive index - the barometer of group-A companies - also gained 3.92 points to climb to 198.48 points. The domination of group- A companies continued this week too as they contributed 77.30 per cent to the total amount transacted. Similarly, the float index - calculated on the basis of real transactions - rose by 0.99 points to reach 73.17 points.
Shareholders of Bank of Kathmandu, this week, gained the most as in terms of monetary value, Bank of Kathmandu (with Rs 88.43 million), Siddhartha Bank (with Rs 44.48 million), Standard Chartered Bank Nepal (with Rs 31.60 million) and Sanima Bikas Bank (with Rs 27.92 million) and Nepal Investment Bank (with Rs 23.07 million) were top scorers.
The market wound up in negative territory for three days in its five-day session. However, it opened in green on Sunday. Nepse gained 18.53 points that day and 15.05 points on Monday to rise to 761.67 points on Tuesday. However, it dipped on Wednesday and Thursday.
In terms of numbers of share units traded, Bank of Kathmandu topped the chart with 43,000-unit shares while in terms of number of transactions Prabhu Finance topped the chart with 421 transactions.
Narayani Finance, Annapurna Bikas Bank, International Leasing and Finance and Guheshwori Merchant and Finance listed their rights shares whereas Diprox Bikas Bank listed its 52,200-unit of bonus shares at Nepse.The government and other institutions' bonds and debentures could not generate public interest in the secondary market. Nepse did not witness any such transaction. Similar was the fate of Over The Counter (OTC) market that also has not seen a single transaction since it started a few months back.
New Sebon chief anytime soon
KATHMANDU: The Finance Ministry will appoint a new chairman of Sebon early this week, according to a ministry source. A retired bureaurocrat is tipped to be the most probable candidate for the post. The post went vacant when Dr Chiranjivi Nepal resigned the chairmanship citing 'no seriousness' on part of Finance Minister Dr Baburam Bhattarai towards developing the capital market. Meanwhile, the government also announced a vacancy for the post of Nepse's general manager. The incumbent general manager Rewat Bahadur Karki has got an extension after his tenure ended three months ago. Karki will stay until a successor is named.
Economic crisis looming large
Former vice-chairman of National Planning Commission (NPC) Dr Shankar Sharma today said the Maoists’ ‘economic revolution’ had failed.
“The delay in service delivery, tug-of war in the Maoist party — between hardliners and moderate faction — and continuous labour problem have put an end to the Maoist claim of economic revolution,” Dr Sharma said, addressing an interaction on ‘Global Economic Crisis and its impact on Nepal’ organised here today.
“Nepal will feel the heat of global crisis a little late as it is not directly linked to the global financial market. But Nepali exports, tourism sector, foreign direct investment (FDI) and remittances will bear the brunt of the crisis,” Prof Bishwambher Pyakurel said, adding that the government has to cough up Rs 1.9 billion more to pay off foreign debt due to rising US dollar.
Former secretary Dr Bhola Chalise said, “The impact will be felt late but was inevitable. The government’s attitude towards the looming crisis is surprising.” He came down heavily on the government for its lackadaisical approach towards crisis mitigation.
Earlier this week, Finance Minister Dr Baburam Bhattarai claimed that Nepal had not been hit by global crisis. He had presented the first quarter’s data to justify his point.
“However, the crisis started in September,” Dr Sharma said, adding that it will take six months to one year to affect Nepali economy. “It’s obvious that the old data, which the Finance Minister presented, doesn’t show any impact,” the former vice-chairman said.
“The data is encouraging,” Finance Secretary Rameshwor Khanal said, defending the government, and added that there was enough liquidity in the financial system at present. “There might be some impact. That’s why the government has formed a committee to study its impact,” he added.
Kush Kumar Joshi, president of Federation of Nepalese Chambers of Commerce and Industry (FNCCI), said the entrepreneurs had started paying the price of the global meltdown. “The first impact has been on food commodities,” he said, adding,”Apart from that, the private sector - despite government’s repeated claims - is suffering from labour dispute. Around 54 industries were closed or remained closed for a long time in the last six months.” Complaining of lawlessness in the country, Joshi said, “Security is our primary concern.”
“The increase in revenue generation will not sustain in the long run,” Dr Dilli Raj Khanal, another economist said, adding that the government can neither meet the GDP target of seven per cent nor will it be able to curb the price rise.
"India is bringing a stimulus package tomorrow and Nepal government is still taking the looming crisis surfacially," he blamed.
“The delay in service delivery, tug-of war in the Maoist party — between hardliners and moderate faction — and continuous labour problem have put an end to the Maoist claim of economic revolution,” Dr Sharma said, addressing an interaction on ‘Global Economic Crisis and its impact on Nepal’ organised here today.
“Nepal will feel the heat of global crisis a little late as it is not directly linked to the global financial market. But Nepali exports, tourism sector, foreign direct investment (FDI) and remittances will bear the brunt of the crisis,” Prof Bishwambher Pyakurel said, adding that the government has to cough up Rs 1.9 billion more to pay off foreign debt due to rising US dollar.
Former secretary Dr Bhola Chalise said, “The impact will be felt late but was inevitable. The government’s attitude towards the looming crisis is surprising.” He came down heavily on the government for its lackadaisical approach towards crisis mitigation.
Earlier this week, Finance Minister Dr Baburam Bhattarai claimed that Nepal had not been hit by global crisis. He had presented the first quarter’s data to justify his point.
“However, the crisis started in September,” Dr Sharma said, adding that it will take six months to one year to affect Nepali economy. “It’s obvious that the old data, which the Finance Minister presented, doesn’t show any impact,” the former vice-chairman said.
“The data is encouraging,” Finance Secretary Rameshwor Khanal said, defending the government, and added that there was enough liquidity in the financial system at present. “There might be some impact. That’s why the government has formed a committee to study its impact,” he added.
Kush Kumar Joshi, president of Federation of Nepalese Chambers of Commerce and Industry (FNCCI), said the entrepreneurs had started paying the price of the global meltdown. “The first impact has been on food commodities,” he said, adding,”Apart from that, the private sector - despite government’s repeated claims - is suffering from labour dispute. Around 54 industries were closed or remained closed for a long time in the last six months.” Complaining of lawlessness in the country, Joshi said, “Security is our primary concern.”
“The increase in revenue generation will not sustain in the long run,” Dr Dilli Raj Khanal, another economist said, adding that the government can neither meet the GDP target of seven per cent nor will it be able to curb the price rise.
"India is bringing a stimulus package tomorrow and Nepal government is still taking the looming crisis surfacially," he blamed.
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