At a time, when revenue mobilisation has been slow, almost in a state of stagnation, struggling to meet the target, the government could rake in Rs 2.46 billion into its coffer, if the current investigation into fake VAT bills is not interrupted.
“After probing 31 tax payers, we have found income tax liabilities come to Rs 1.41 billion and fake VAT liabilities come to Rs 1.5 billion, making a total of Rs 2.46 billion,” revealed the Inland Revenue Department.
According to an IRD report, using fake VAT bills, three industries have defaulted revenue worth Rs 1 billion, one housing company has defaulted Rs 150 million, eight authorised automobile dealers Rs 200 million, seven exporters Rs 890 million, four construction companies Rs 810 million, three electronics business houses Rs 110 million, three hardware shops Rs 140 million, one multinational company’s authorised dealer Rs 100 million and one supplier has defaulted Rs 800 million.
“The department has also forwarded a list of 480 tax payers — suspecting them of using fake VAT bills — across the country to keep them under strict watch,” said IRD Chief Rajan Khanal.
“Using fake VAT bill is a serious crime that equals to using fake currency notes,” said Deputy Prime Minister and Minister for Finance Bharat Mohan Adhikary today at a press meet he called, snubbing the parliamentary Public Accounts Committee that had called him this morning ‘to explain the possible revenue-default of billions’. “The government is committed to making VAT defaulters pay fine,” said Adhikary, trying to come clean on ‘allegations’ that he pressured Finance Secretary Rameshwor Khanal to give amnesty to VAT defaulters. “I have no relations with the alleged VAT defaulters, the pongee Unity scam, casinos’ revenue cheating and transfer of finance ministry officials to lucrative posts.”
Finance Secretary Rameshwor Khanal on Tuesday went on home leave after ‘he was pressured to take decision that could have hurt the government coffer’. Khanal’s decision to go on leave saying he would not return, has hurt those who engineered his removal where it matters the most. Chief Secretary Madhav Ghimire said Khanal is on home leave till April 13 and has tendered resignation with effective from April 14.
Thursday, March 31, 2011
Wednesday, March 30, 2011
'Give special treatment to landlocked LDCs'
Land-locked Least Developed Countries (LLDCs) should get special treatment, said experts. "The LLDCs should get separate treatment as they are additionally handicapped," said former National Planning Commission (NPC) member Dr Dilli Raj Khanal at an interaction on 'En route to UNLDC IV: Preparatory works and Nepal's Leadership, organised by South Asia Watch on Trade Economics and Environment (SAWTEE) here today.
"The cosmetic changes will not help LDCs meet the target unless there is socio-economic transformation," he said, adding that the structural transformation can alone benefit.
However, LDCs like Nepal have to enhance production capacity with changes in policy, he suggested, adding that productivity could not be enhanced with current industrial policy, institutional mechanism, and tariff regime.
The fourth United Nations Conference on the Least Developed Countries (UNLDC IV) is going to be held in Istanbul, Turkey on May 9-13. The purpose of the conference is to assess the results of the 10-year action plan for the LDCs adopted at UNLDC III in Brussels, Belgium in 2001 and to adopt new measures and strategies for the sustainable development of the LDCs into the next decade.
LDCs, including Nepal, have been engaged in preparatory works for the conference at national as well as regional and global levels through the participation of government organisations, civil society organisations, international organisations, private sector, academia, media, and all relevant stakeholders.
Currently, Nepal is the chair of the LDC Group, and therefore, the role it is playing in the preparatory process for UNLDC IV is extremely important.
"Integration of LDCs in access to multilateral trade regime could help sustainable development, said Permanent Representative of Nepal to the WTO and Permanent Mission to the United Nations Office at Geneva ambassador Dr Dinesh Bhattarai, who has been coordinating the preparatory tasks among the LDC representatives in Geneva.
In UN parlance, they are the 48 LDCs. Thirty-three are located in sub-Saharan Africa; 14 in southern Asia and Oceania; and one (Haiti) is in the western hemisphere.
Balanced on a knife edge between sorrow and hope, the case of the LDCs poses the next big globalisation challenge.
Investors are now eager to engage on a worldwide stage, and the world's new investors – the rising powers from the global south – are fast becoming major LDC trading and investment partners.
"The cosmetic changes will not help LDCs meet the target unless there is socio-economic transformation," he said, adding that the structural transformation can alone benefit.
However, LDCs like Nepal have to enhance production capacity with changes in policy, he suggested, adding that productivity could not be enhanced with current industrial policy, institutional mechanism, and tariff regime.
The fourth United Nations Conference on the Least Developed Countries (UNLDC IV) is going to be held in Istanbul, Turkey on May 9-13. The purpose of the conference is to assess the results of the 10-year action plan for the LDCs adopted at UNLDC III in Brussels, Belgium in 2001 and to adopt new measures and strategies for the sustainable development of the LDCs into the next decade.
LDCs, including Nepal, have been engaged in preparatory works for the conference at national as well as regional and global levels through the participation of government organisations, civil society organisations, international organisations, private sector, academia, media, and all relevant stakeholders.
Currently, Nepal is the chair of the LDC Group, and therefore, the role it is playing in the preparatory process for UNLDC IV is extremely important.
"Integration of LDCs in access to multilateral trade regime could help sustainable development, said Permanent Representative of Nepal to the WTO and Permanent Mission to the United Nations Office at Geneva ambassador Dr Dinesh Bhattarai, who has been coordinating the preparatory tasks among the LDC representatives in Geneva.
In UN parlance, they are the 48 LDCs. Thirty-three are located in sub-Saharan Africa; 14 in southern Asia and Oceania; and one (Haiti) is in the western hemisphere.
Balanced on a knife edge between sorrow and hope, the case of the LDCs poses the next big globalisation challenge.
Investors are now eager to engage on a worldwide stage, and the world's new investors – the rising powers from the global south – are fast becoming major LDC trading and investment partners.
Tuesday, March 29, 2011
Secretary walks out on finance minister
Has the finance secretary taken the bull by the horns or was it just a reaction in a fit of rage? It will take some time for the truth to come out, but the bureaucratic circle today was taken by surprise when Finance Secretary Rameshwor Khanal left his office, on foot refusing to take the government vehicle, following a tiff with Finance Minister Bharat Mohan Adhikari.
According to sources, while leaving, Khanal even said he would not return to office.
Though tussles between secretaries and ministers are a commonplace, following today’s incident, rumours were doing the rounds that Khanal had even tendered his resignation. Even the donor agencies were all ears to find out what exactly happened, as they have been closely working with Khanal for quite some time.
When The Himalayan Times tried to find out, Khanal briefly said he was not in the mood to talk. “I cannot speak anything now. I need some rest.” In bureaucratic circles Khanal is known as one of the most disciplined civil servants.
“Khanal was against amnesty to VAT defaulters but Adhikari was hell-bent on saving them, as he was under the influence of the defaulters,” said a highly-placed official at the finance ministry, who was well aware of the brewing tension between the two.
Worried about low revenue mobilistion in the current fiscal, the ministry has come hard on VAT defaulters and was raiding firms almost every day, but the crackdown came to a halt after Adhikari became finance minister, said ministry officials. “VAT defaulters are supposed to pay Rs 1.30 billion to the government, but instead, they influenced the finance minister,” said the ministry official.
“However, the brewing tension today spilled out of the brim at a time when Unity — a pongee scheme that has fled with billions from people — was trying to regroup itself by influencing political parties and VAT defaulters were pressing the finance minister to transfer Khanal,” added the official.
Today’s incident is observed by the bureaucrats as an addition in the series of tussles as in recent times they have seen war of words between former energy minister Prakash Sharan Mahat and secretary Shankar Prasad Koirala, former minister for labour and transport management Mohammad Aftab Alam and secretary Dinesh Hari Adhikari, former forest minister Deepak Bohara and secretary Yubraj Bhusal and former deputy prime minister and foreign minister Sujata Koirala and secretary Madan Kumar Bhattarai during Madhav Kumar Nepal-led government.
However, bureaucrats believe that there was an urgent need to overhaul the working culture of ministers.
“How can people expect bureaucracy to work for public welfare when ministers pressure secretaries to work to fulfil their partisan and personal interests, that too going against the rule of law,” added the official.
According to sources, while leaving, Khanal even said he would not return to office.
Though tussles between secretaries and ministers are a commonplace, following today’s incident, rumours were doing the rounds that Khanal had even tendered his resignation. Even the donor agencies were all ears to find out what exactly happened, as they have been closely working with Khanal for quite some time.
When The Himalayan Times tried to find out, Khanal briefly said he was not in the mood to talk. “I cannot speak anything now. I need some rest.” In bureaucratic circles Khanal is known as one of the most disciplined civil servants.
“Khanal was against amnesty to VAT defaulters but Adhikari was hell-bent on saving them, as he was under the influence of the defaulters,” said a highly-placed official at the finance ministry, who was well aware of the brewing tension between the two.
Worried about low revenue mobilistion in the current fiscal, the ministry has come hard on VAT defaulters and was raiding firms almost every day, but the crackdown came to a halt after Adhikari became finance minister, said ministry officials. “VAT defaulters are supposed to pay Rs 1.30 billion to the government, but instead, they influenced the finance minister,” said the ministry official.
“However, the brewing tension today spilled out of the brim at a time when Unity — a pongee scheme that has fled with billions from people — was trying to regroup itself by influencing political parties and VAT defaulters were pressing the finance minister to transfer Khanal,” added the official.
Today’s incident is observed by the bureaucrats as an addition in the series of tussles as in recent times they have seen war of words between former energy minister Prakash Sharan Mahat and secretary Shankar Prasad Koirala, former minister for labour and transport management Mohammad Aftab Alam and secretary Dinesh Hari Adhikari, former forest minister Deepak Bohara and secretary Yubraj Bhusal and former deputy prime minister and foreign minister Sujata Koirala and secretary Madan Kumar Bhattarai during Madhav Kumar Nepal-led government.
However, bureaucrats believe that there was an urgent need to overhaul the working culture of ministers.
“How can people expect bureaucracy to work for public welfare when ministers pressure secretaries to work to fulfil their partisan and personal interests, that too going against the rule of law,” added the official.
USAID helps $30 million
The US is helping Nepal strenghten fiscal and trade policies.
"The US Agency for International Development (USAID) through Nepal Economic, Agriculture and Trade (NEAT) project will also encourage competitiveness and exports, enhance food security and increase access to financial services," said US ambassador Scott H DeLisi at the launching the NEAT programme here in the Valley today.
"Development assistance alone cannot improve lives of Nepalis, DeLisi said, Lauding the private sector's role. "The private sector could transform the economy and create opportunities for youth not the international donors."
NEAT will invest $30 million to foster a conducive business environment for private sector-led growth, encourage competitiveness and exports in selected agriculture and non-agriculture commodities or services, initially tragetting lentile, ginger, orthodox tea and vegetables, said NEAT's chief of Party Phil Broughton.
The programme will help improve trade and fiscal policies and practices to facilitate trade and increase revenues without distorting the economy, he said, adding that the programme will also strenghten microfinance policy and institutions to increase access of women, poor and disadvantaged to financial services.
Broughton also emphasised on the need to create Credit Information Bureau (CIB) for microfinance institutions to check multiple lending -- that has been observed recently -- as the over lending could create systemic problem in the microfinance sector.
The two-and-a-half year NEAT programme also targets to work in selected districts in the Mid-West and far-West regions. "Working with a broad range of partners including the government agencies business associations, farmers' cooperatives microfinance institutions, NGOs and local research institutions, the programme is expected to impact millions of lives in the rural areas, he added.
Similarly, taking part in the panel discussion Laxmi Bank CEO Suman Joshi said that marriage of technology and microfinance can help expand reach of financial access to rural youths and reverse the trend of increasing informal economy.
"Capacity building of bureaucracy, professional trade union and policy stability can help propel economic growth," he said, advising to reform capital market to attract Foreign Institutional Investors as without foreign direct investment, the country cannot invest on huge infrastructure projects.
"The national savings is too low to fund big projects leaving no alternatives to attract foreign direct investment," he added.
"The US Agency for International Development (USAID) through Nepal Economic, Agriculture and Trade (NEAT) project will also encourage competitiveness and exports, enhance food security and increase access to financial services," said US ambassador Scott H DeLisi at the launching the NEAT programme here in the Valley today.
"Development assistance alone cannot improve lives of Nepalis, DeLisi said, Lauding the private sector's role. "The private sector could transform the economy and create opportunities for youth not the international donors."
NEAT will invest $30 million to foster a conducive business environment for private sector-led growth, encourage competitiveness and exports in selected agriculture and non-agriculture commodities or services, initially tragetting lentile, ginger, orthodox tea and vegetables, said NEAT's chief of Party Phil Broughton.
The programme will help improve trade and fiscal policies and practices to facilitate trade and increase revenues without distorting the economy, he said, adding that the programme will also strenghten microfinance policy and institutions to increase access of women, poor and disadvantaged to financial services.
Broughton also emphasised on the need to create Credit Information Bureau (CIB) for microfinance institutions to check multiple lending -- that has been observed recently -- as the over lending could create systemic problem in the microfinance sector.
The two-and-a-half year NEAT programme also targets to work in selected districts in the Mid-West and far-West regions. "Working with a broad range of partners including the government agencies business associations, farmers' cooperatives microfinance institutions, NGOs and local research institutions, the programme is expected to impact millions of lives in the rural areas, he added.
Similarly, taking part in the panel discussion Laxmi Bank CEO Suman Joshi said that marriage of technology and microfinance can help expand reach of financial access to rural youths and reverse the trend of increasing informal economy.
"Capacity building of bureaucracy, professional trade union and policy stability can help propel economic growth," he said, advising to reform capital market to attract Foreign Institutional Investors as without foreign direct investment, the country cannot invest on huge infrastructure projects.
"The national savings is too low to fund big projects leaving no alternatives to attract foreign direct investment," he added.
Monday, March 28, 2011
Nepal, Taiwan sign pact to jointly combat money laundering
Nepal signed a memorandum of understanding (MoU) with Taiwan today to join hands in fighting against money laundering, terrorism funding and other financial crimes.
Head of the Financial Information Unit of Nepal Rastra Bank Dharma Raj Sapkota and director-general of Investigation Bureau (IB) under Ministry of Justice of Taiwan Chang Chi-ping signed the MoU on behalf of their respective institutions in Taiwan.
Under the MoU, the two countries will exchange information about suspected money laundering and other cross-border financial criminal activities, including terrorism financing.
Nepal and Taiwan both are members of the Asia Pacific Group (APG) on Money Laundering. The two countries began discussions last year on the MoU during an annual APG conference in Singapore.
As Taiwan was designated to help Nepal meet the requirements to join the Egmont Group to counter money laundering, Taiwan has sponsored a training programme for central bank officials of financial intelligence department on how to craft a legal framework for documentation of financial dealings and prevention of money laundering.
Only Egmont Group membership qualifies Nepal to exchange information -- relating to Money Laundering and Terrorism Financing -- with and among the FIUs around the world. Nepal has made preliminary application for Egmont Group membership in January 2010.
The Egmont Group of Financial Intelligence Units (FIUs) provides a forum for FIUs to improve cooperation in the fight against money laundering and the financing of terrorism and provide support for the implementation of domestic AML/CFT regimes.
The Group was founded in 1995, when a group of FIUs met at the Egmont Arenberg Palace in Brussels, and now has 116 members worldwide. The member FIUs meet regularly to find ways to cooperate, especially in the areas of information exchange, training and the sharing of expertise.
Currently known as the Egmont Group, these FIUs meet regularly to find ways to cooperate, especially in the areas of information exchange, training and the sharing of expertise.
As part of the recognised global network of FIUs, Egmont members can take advantage of the cooperation and mutual assistance fostered by the group. Meetings and workshops provide a forum for the sharing of best practices, and allow all members to participate fully in Egmont Group decision-making. Members share experiences and ideas, offer advice, and learn from the successes and mistakes of colleagues.
The Egmont Group has fostered a collegial environment over the years, a forum of goodwill where colleagues meet, become acquainted and openly and eagerly assist one another.
ADB grant to spur agribusiness, higher incomes in hilly districts
The Asian Development Bank (ADB) is to help thousands of households in remote mountainous areas of Nepal gain more income from the production and sale of valuable agricultural produce.
A grant of $20 million from ADB’s concessional Asian Development Fund for the High Mountain Agribusiness and Livelihood Improvement Project will be provided to small farmers and rural enterprises to help them increase the value and salability of their goods, said the Manila-based agency.
The initiative is expected to generate new jobs for an estimated 7,500 people, directly benefiting about 5,000 households in 10 districts across four development regions.
"The goal is to make mountain agribusinesses more commercially viable and to take advantage of improving rural infrastructure, as well as rising private sector interest in their goods," said Hans Woldring, agriculture and natural resources economist with the ADB.
Agriculture employs about two-thirds of Nepal’s population and contributes over a third of the country’s gross domestic product (GDP). Despite the sector’s importance, growth has been constrained by farmers’ limited access to services, marketing, and employment opportunities.
The country is not only a net food importer, but it is also witnessing a rising private sector demand for many mountain products such as wool, seeds, off-season vegetables and medicinal plant products.
By supporting activities such as improved processing, packaging, distribution and marketing, the project will help agribusinesses add quality and value to their goods, increase investment opportunities and links with the private sector, and boost off-farm employment.
"It will be especially beneficial for women as many farm households are headed by them, and they are heavily involved in small rural enterprises engaged in producing high-value items from local materials," the bank added.
The government will provide over $4.5 million equivalent, while beneficiaries sponsoring private sector investments in the industry will extend over $5.7 million equivalent, for a total project cost of over $30.2 million. The Ministry of Agriculture and Cooperatives is the executing agency for the project which has an expected completion date of April 2017.
Zhao leaves Kathmanu
Zhao leaves Kathmanu
KATHMANDU: Vice-President of ADB Xiaoyu Zhao reiterated ADB’s continued assistance for Nepal’s efforts to reduce poverty and promote inclusive growth and at the same time urged Nepal to remain focused on the country's reform and development agenda, while taking the peace and constitution drafting process forward. Zhao was informed of the government’s plan to address the energy crises and he affirmed ADB’s support to help address the power shortages. He stressed that developing alternative and renewable energy in a sustainable manner and strengthening Nepal’s economic and infrastructure linkages with neighboring countries through regional cooperation were also important and also called upon greater investment in public-private partnerships for sustainable development. He also congratulated the new government and expressed confidence that the new government would continue to forge a broad-based political consensus for taking the peace and constitution drafting process forward, along with creating a conducive environment for development activities and inclusive growth for all. Zhao made the comments at the end of a three-day official visit to the country. During his visit, Zhao held consultations with the newly-elected PM Jhala Nath Khanal and DPM and Finance Minister Dr Bharat Mohan Adhikary. Zhao also made field trips to various ADB-assisted projects in Lumbini and the surrounding areas, and met up with the project staff and beneficiaries. He visited the South Asia Tourism Infrastructure Development project, where ADB is supporting development and improvement of infrastructure and services in Lumbini. Zhao also visited the Bhairawa-Bhumai road that was constructed under the ADB-assisted Subregional Transport Facilitation Project.
Global smartphone shipments to hit 653m by 2016
The global smartphone market will double in size by 2016 to hit shipments of 653 million, according to a study by Ovum.
Android will drive the growth and will emerge as the dominant platform, outperforming Apple with a 20.5 per cent lead on market share.
Smartphones will grow at a CAGR of 14.5 per cent between 2010 and 2016, and will account for approximately 40 per cent of the mobile phone market. Asia-Pacific will ship just over 200 million units by 2016.
Western Europe and North America will remain strong markets with 175 million and 165 million shipments respectively. There will be shifts in dominance for smartphone software platforms, with Android taking the lead with 38 percent market share, compared to Apple iOS' 17.5 per cent, by 2016. Just behind Apple iOS will be Windows Phone, with 17.2 per cent market share by 2016, followed by BlackBerry OS with 16.5 percent.
Android will drive the growth and will emerge as the dominant platform, outperforming Apple with a 20.5 per cent lead on market share.
Smartphones will grow at a CAGR of 14.5 per cent between 2010 and 2016, and will account for approximately 40 per cent of the mobile phone market. Asia-Pacific will ship just over 200 million units by 2016.
Western Europe and North America will remain strong markets with 175 million and 165 million shipments respectively. There will be shifts in dominance for smartphone software platforms, with Android taking the lead with 38 percent market share, compared to Apple iOS' 17.5 per cent, by 2016. Just behind Apple iOS will be Windows Phone, with 17.2 per cent market share by 2016, followed by BlackBerry OS with 16.5 percent.
The partnership between Nokia and Microsoft has redrawn the smartphone market and will result in a reduction in shipments of Symbian-based handsets as Nokia transitions to Windows Phone as its primary smartphone platform. However, Nokia still expects to ship 150 million Symbian-based handsets so there will be shipments beyond 2012 and in some regions into 2016.
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