धर्मराज भीष्मलाई सोध्छन्। राजालाई राज्य चलाउन र विकास गर्न प्रशस्त  आर्थिक स्रोतको आवश्यकता पर्दछ, यसैले धर्मको पूर्वानुमान नगरी यसलाई कसरी प्राप्त गर्ने भनेर भिष्मले जवाफ

धर्मराज भीष्मलाई सोध्छन्। राजालाई राज्य चलाउन र विकास गर्न प्रशस्त  आर्थिक स्रोतको आवश्यकता पर्दछ, यसैले धर्मको पूर्वानुमान नगरी यसलाई कसरी प्राप्त गर्ने भनेर भिष्मले जवाफ

क. धर्मको सिद्धान्तको उल्लंघन नगरी सरकारले पैसा कमाउनुपर्दछ।

ख. कुनै पनि अनावश्यक बोझ र कुनै उत्पीडन बिना विवेकाधिकार कर प्रणाली। जस्तै २५ %धनी र धनी व्यापारीहरूको लागि, सस्तो ७.५ % विपन्न वर्गका साथ पूर्ण व्यवसायमा छूट दिने व्यवसायका लागि। सरकारले ब्यापार ट्र्याक गर्नु पर्छ जसले राम्रो राजस्व उत्पन्न गर्छ तर रेकर्डमा देखाउँदैन।

ग. कोषबाट उत्पन्न गरेको भन्दा बढि खर्च नगर्नुहोस्। एउटा ठूलो रिजर्व राख्नुहोस् र जब सम्म यो पुनः भरिपूर्ण हुँदैन त्यो भन्दा बढि खर्च नगर्नुहोस्।

घ. राम्रो समयमा अनावश्यक पैसा खर्च  नगर्नुहोस् । कठिन समयहरू हुन बाध्य हुन्छन् र त्यो खराब समयको लागि संरक्षण र रिजर्भ गर्न तयार हुन्छन्। बफरहरू सिर्जना गर्न प्रयास गरिरहनुहोस्।

. पैसा प्रबन्ध गर्ने जिम्मामा सँधै सावधानीपूर्वक हेर्नुहोस्।

च . जनसंख्याको केहि खण्डहरूमा बारम्बार कर नलगाउनुहोस् जसले केवल चोर्ने र आय लुकाउन सक्छ। शत्रुहरूको सम्बन्धमा पनि कर दरहरू उचित र न्यायसंगत हुनुपर्दछ।

छ.  कृषिलाई सँधै ध्यान दिनुहोस्। यसले देशलाई प्रशंसनीय बनाउन सक्छ

ज. वातावरण संरक्षण र संरक्षण गर्नुहोस् जसले राष्ट्रलाई लामो अवधिमा प्राप्त गर्न मद्दत गर्दछ।

** शान्ति पर्वम।

आश्चर्यचकित हाम्रा नेताहरू जसले नेपालबाट शास्त्रहरू उद्धृत गर्छन् यो सरल सल्लाह शासन प्रणालीमा गहिरो रूपमा लागु गर्न सक्दैनन्।

 

Translated from the Courtesy of Mr. Bandi Ram Prasad

Challenges and Opportunities before the NRB New Governor

Challenges and Opportunities before the NRB New Governor

shanker man singjh

BY Shanker Man Singh [i]

The process of selecting a new central bank governor formally began with the formation of a three-member committee under Finance Minister. The main responsibility of the committee was to identify candidates who have the potential to lead NRB for the next five years. These names were forwarded to the Cabinet. Nepal’s cabinet has appointed Mr. Maha Prasad Adhikari, former Deputy Governor at NRB and the incumbent CEO of Nepal Investment Board as the 17th Governor of the Nepal Rastra Bank. The new governor shall remain in office for five years. The governor’s term can be extended by another five years.

 

Challenges and Opportunities before the NRB New Governor

Challenges

The guv has assumed office at a time when people were worried about various economic realities like the economic slowdown due to Corona virus pandemic. The economic costs will be considerable. The problem combines demand and supply shocks. The problem has spread to the financial sector. We are all in it together. Policy responses matter but differ markedly. Besides, Nepal is facing increasing inflation, thinning foreign exchange reserve, widening expenses for import and speculation over devaluation of Nepali currency, liquidity management issues, decreasing deposit in the banking sector, irregularities among cooperatives, declining NEPSE Index, increased trade deficit, disappointed investors, and marginal decline in remittance. These burning problems will encircle the upcoming Governor from the hour he will check in his office as NRB boss. Moreover, harmonious relations with the Nepal Bankers Association  has to be maintained in terms of addressing the issue of COVID, labor issues,  liquidity management, moratorium on the loans, will further aggravate the problem.

The new guv and the Government has to come up with the revival package to combat the impact of COVID 19 like the guarantee on the loan for the rent and the steady supplies needed for the business and industry; concession and or relaxation on the payment of loan and the interest thereof; lowering tax rate and contribution to the business; salary hand out to those who cannot work; income support for the person who are laid off; holiday on mortgage payment, cash handouts for the family who are in dire need. These type of facilities are provided in other countries and our neighboring countries are also working on it. Help in current capital, moratorium on the payment of loan, New definition of NPA based on not the payment days, change in policy rate, tax holiday on payroll, low percentage of VAT, special package for  tourism, hospitality, retail , entertainment sector, lowering the price of POL Products, stimulus for consumption, cash support for laborers, tax payment  periods to be extended, urban utilities to be made free, direct  transfer to the people working in informal sector, fiscal support rather than waiver to hospitality and service sector, if the COVID cycle runs for 3-6 months and if it is not properly addressed the reluctant effect will remain for about 3-6 years in the countries like Nepal. Nepal should not look into fiscal deficit in this time of economic problem and a 2-3 billion rupees  stimulus package is needed for agriculture and the manufacturing  industries. WINSTON Churchill has said, “Never waste a good crisis”. So we have to reset our targets and our approach in achieving those targets in the recent days. Governor should  perform a regulator’s role also needs to be fully implemented with due prudential norms.

Nepal’s Central bank governor’s job is perhaps the most technocratic of all policymakers in the least developed country like Nepal in particular. The recent appointment of the cadre based person shows ample hope that the issue will be addressed in an amicable way. NRB’s function is to maintain stability in the macro economy and the financial system. In the advanced capitalist world, macroeconomic stability has come to mean price stability. For a developing economy, it could also mean defending the exchange rate or maintaining solvency of the government. Financial system stability means maintaining a functioning banking system, keeping the credit flowing, and acting as the lender of the last resort. The new Governor will how far be successful to do so in some financial institutions cases. Since Nepal’s capital market is basically based on the finance and banking institutions rather than the real sector. The Governor’s role has a significant say in the capital market.

Heading the central bank requires a solid understanding of macroeconomic theory and empirics, and practical experience in banking and finance. NRB needs to have years of experience that allows one to develop a thorough understanding of the data, or network in the industry that allows one to make a few phone calls and get a feel for things in a rapidly evolving world. NRB, as the central banker needs to complement rigorous analysis that is founded on a solid understanding of macroeconomic theory and practice with subjective judgment that comes only with experience. For this on-site and off site inspection along with the financial intelligence and financial engineering is a must. The section of Mr. Adhikary in this context seems logical and timely.

At a time when the financial sector needs support, co-operation and coordination, the IMF resident office is no more in Nepal and the country director of the World Bank has already shifted. These risks in the financial sector have been building up and need to be addressed urgently with the advice and or the support of the IMF and the World Bank.  Over the past years, accommodative monetary policy, weak supervision, and proliferation of financial institutions have led to rapidly rising asset prices and overextension of banks needing the merger. Going forward, the financial system needs to adapt to an environment of slower growth and is likely to see deteriorating asset quality.

What about the specific challenges that the new governor might face? A recent report of IMF at the Conclusion of the 2014 Article IV states that In concluding the 2020 Article IV Consultation with Nepal, Executive Directors endorsed staff’s appraisal as follows:

“Growth is expected to moderate, helping to contain macroeconomic stability risks. Nepal’s recent strong growth performance has been supported by a stable political environment, a more reliable electricity supply, and post-earthquake reconstruction spending. Efforts to prevent excessive credit growth and contain financial-sector risks should continue. The NRB has appropriately implemented macro prudential measures to limit the buildup of systemic risk in the financial sector. It has also taken actions to further strengthen bank supervision and regulation, including the introduction of a supervisory information system and implementation of selected elements of the Basel III capital framework. The recent regulatory requirement for banks to cross-check corporate borrowers’ financial information against the ITS is expected to facilitate more prudent risk assessment by banks. Activation of the countercyclical capital buffer that will require banks to increase their level of capital by July 2020 is appropriate. The NRB should continue to closely monitor asset quality of banks and improve monitoring of concentration risk.

Fiscal policy should be geared towards containing external pressures and protecting fiscal sustainability. In this regard, a fiscal deficit of 4.5 percent of GDP, similar to the outcome in FY2018/19, would be prudent. Recent upgrades to tax administration are commendable. Staff underscores that a top-down budget process and MTFF based on conservative revenue and expenditure assumptions would instill greater prioritization and would avoid creating unrealistic revenue expectations among SNGs. While important steps have been taken to improve public financial management, further efforts are needed to ensure that spending is of high quality and executed in a timely manner.

The transition to fiscal federalism is a monumental challenge and needs to be carefully managed. To protect fiscal sustainability, the overall expenditure envelope of SNGs needs to be aligned with available funding, with tight limits on any subnational borrowing. A robust reporting and monitoring system for SNGs is urgently needed. There also needs to be a clear delineation of roles and responsibilities across levels of government to ensure adequate delivery of services and investments.

Strengthening the implementation of monetary policy requires a well-functioning interest rate framework that reduces volatility in short-term interest rates. Less short-term interest rate volatility would support financial market development and improve policy signaling and transmission. Staff emphasizes the need to introduce a standing deposit facility as a first step towards establishing a reliable implementation track record for the interest rate corridor.

Achieving the central bank’s mandated price and financial stability objectives calls for modernizing the NRB governance framework to improve its autonomy and accountability, Reforms are needed to strengthen independent oversight, safeguard institutional and personal autonomy, and enhance internal controls and quality of external audit, all underpinned by supportive human resource management.

To boost growth prospects, structural reforms that encourage high-quality investment projects, in particular FDI, are critical. As post-earthquake reconstruction spending draws to a close in coming years, maintaining the recent growth momentum will require an enabling implementation environment for infrastructure projects and FDI. To ensure that high-quality projects move forward in a clear and timely manner, staff encourages authorities to focus on adequate staffing, better skills matching, and aligning incentives across and within government ministries responsible for project approvals, implementation, and subsequent monitoring.

Monetary policy should aim at controlling the volatility and level of excess reserves in the financial system, implying a modest tightening of monetary conditions. The exchange rate peg to the Indian rupee provides a useful nominal anchor for the economy, and the real exchange rate is broadly in line with fundamentals. Capital spending needs to be boosted to provide key infrastructure, and reforms implemented to support private investment, which will help generate sustained economic growth and employment opportunities. In the financial sector, further reforms to bolster regulation and supervision, and improve financial infrastructure are needed to reduce risk and increase access to finance.

Tackling structural problems remains essential to achieve high growth over the medium term. While Nepal’s potential is high, progress is required in addressing the poor business climate, power shortages, infrastructure needs, weak governance, and difficult labor relations. Political stability and improved security are necessary conditions for progress in several of these areas.”

Given the huge expansion of banks and financial institutions, NRB’s supervision should be further strengthened. These issues need to be addressed immediately and with due seriousness. We have to ensure that the banks and financial institutions operate in a healthy environment.  The NRB is an institution. But, we need to have coordination among the Ministry of Finance, NRB and NPC to address economic challenges facing the country.

The new governor who has taken  over during the moderate storm to batter the economy in living memory. He will need all his wits, and then some, to guide us through. To navigate this treacherous terrain, one hopes he builds a strong team noting some of the challenges mentioned here. Let’s also wish him good luck in his task ahead, for he will need it, badly.

 

 

[i] Shanker Man Singh

MBA, PGDIM (Delhi School of Eco.), TIS (Bangkok),SEC( USA)

Former Executive Director- SEZ Development Committee, GoN/
Former General Manager/ CEO-Nepal Stock Exchange Limited (NEPSE)
Associated with: Trade Promotion Centre, Nepal Chamber of Commerce,
FNCCI, CNI, UNDP, World Bank, ILO, GTZ, ECONOMIC Services Centre,
CDSC, CIT, Rashtriya Banijya Bank as Board Member.

नेपाल का लागि स्टिमुलस प्याकेजको जरुरत:

नेपाल का लागि स्टिमुलस प्याकेजको जरुरत:

shanker

  

सम्माननीय प्रधानमन्त्रीज्यूवाट देशवासीका नाममा संम्बोधन गर्दै विश्वव्यापी यो महामारीले समग्र अर्थ व्यवस्थामा परेको असरका बिषयमा अर्थ मन्त्रालयले सुक्षम  अध्ययन गरिरहेको जनाउदै अर्थव्यवस्थामा परेको र पर्न सक्ने प्रभावको विश्लेषण गरि अर्थतन्त्रमा संकुचन आउन नदिन सरकारले छिट्टै उपयूतm कार्यक्रम ल्याउने उल्लेख गर्नू सकारात्मक रहेको छ I   

नेपाली जनता नेपाल  सरकारबाट गठित उच्च स्तरिय कोरोना भाइरसलाई संम्बोधन गर्न गठित समितीबाट लिईएका निर्णयहरुको उच्च मूल्याकंन गर्दछ । कोरोनावाट प्रत्येक्ष र परोक्ष रुपमा पर्ने आर्थिक असरहरुमा समेत कमि आउनु पर्दछ । हालै सार्वजनिक गरिएको कोविड १९ संक्रमण, रोकथाम तथा नियन्त्रण उच्चस्तरिय समन्वय समितीको वैठकको निर्णयहरुले श्रमिक र उनीहरुको परिवार लगायत व्यवशायिक जगतमा समेत केहि आवश्यक टेवा पुग्ने अपेक्षा गरिएको छ । यसै सन्दर्भमा भाईरसको संक्रमणलाई रोक्न व्यवशायका अधिकांम्स क्रियाकलापहरुलाई हटाउन र घटाउन पर्ने भएको छ I यी घटना परिलक्षित थिएन तर हाल अनिवार्य हुन पुग्यो फलस्वरुप सवै प्रकृति र आकारका व्यवशायहरु मुलुकभरनै व्यवशायिक क्रियाकलापको कटौतिवाट बिक्री तथा नाफामा उल्लेखनीय कटौति मात्र होईन कति व्यवशायमा घाटा समेत भएको स्थिति छ । वस्तु तथा सेवाको विक्रीवाट हुने आम्दानीको कमिवाट कर्मचारीलाई र अन्य वित्तीय दायित्व पूरा गर्न नसक्ने स्थितिमा उद्यमी व्यवशायी पुगेका छन् । यो एक अस्थायी घट्ना हो । हाल खर्च र लगानी गरिएको रकम यो संसार भर फैलिएको महामारी खतम भए पछि शान्त हुने छन् ।तथापी संकटको यस घडिमा नेपाल सरकार, प्रदेश सरकार र स्थानिय सरकारले व्यतिm परिवार र व्यवशायमा परेको यो आम्दानी हराएको  घडिमा नीजि क्षेत्रलाई राहतको महशुस गराउनु पर्दछ। कोरोना भाईरसको अस्थायी वा अल्पकालिन कारणले गर्दा कुनै पनि परिवार र व्यवशायहरु टांट पल्टने स्थितिमा जानु हुदैन ।

नेपालका उद्यमी, व्यवशायी र उपभोतmाको हीतकोलागी  सरकार वाट ठोस रचनात्मक आर्थिक कदमको अपेक्षा गर्दछ । उद्यमी व्यवसायीलाई  सहयोग गर्नु श्रमिकलाई सहयोग गर्नु हो ।

स्टिमुलस प्याकेजले सरकारको खर्च गर्ने प्रक््िरmया वृद्धि हुने, करको दर घट्ने,  ब्याजदर घट्ने र यसबाट रिसेसेन वा डिप्रेसनमाजानलागेको अर्थतन्त्रलाई उठाउँदै क्रियाकलापहरु हुने गर्दछन् । साथै यसबाट रोजगारी, उपभोक्ताको खर्च, लगानीको माध्यमबाट कूलभागमा वृद्धि हुने र स्टिमूलस प्याकेजले विस्तृत वितिय तथा मौद्रिकनीतिको अवलम्बनबाट नेपालको अर्थतन्त्रले केही सही दिशा लिन सक्ने छ । निजि क्षेत्रको मनोबल उकास्न समेत सरकाले लक्षितवर्गको मनोवल उच्च राख्न विभिन्न क्रियाकलाप भएको अनुभूति निजि क्षेत्रलाई हुनु पर्छ, ।  

   कोरोना भाइरसको प्रभावको बारेमा सो प्रभावबाट व्यवसाय क्षेत्रमा परेको नकारात्मक असरलाई हटाउन तत्काल व्याज र आयकर समेत भुक्तानी गर्ने समय भएकोले प्रभावित उद्यमी, व्यवसायीलाई सुविधा प्रदान गर्न सरकारले पहल गर्नु पर्दछ । साथै अत्यावश्यक वस्तुको सहज, सरल र नियमित आपूर्ति व्यवस्थापनको लागि सुपथमूल्य पसल वा मूल्य नियन्त्रणका विविध उपाय अवलम्वन गरी सर्वसाधारणलाई राहत उपलब्ध गराउने व्यवस्था हुनु पर्दछ । कोरोनाबाट भएको असरको दीर्घकालिन समस्या सम्बोधनका लागि पूर्वाधार आयोजनाहरु शुरु गर्ने र समयमा नै समाप्त गर्ने जसबाट रोजगारीको सृर्जना हुन सक्छ ।  कोरोना भाइरस (कोभिड(१९) का कारण विश्व एवम् नेपाली अर्थतन्त्रमा संकुचनको संकेत देखिन थालेको छ । कोरोनाका कारण हुने सम्भावित जोखिमहरू बारे सरकार तथा निजी क्षेत्र तथा सम्बन्धित निकायले छलफल गरेर नीतिगत संरचना नै मजबुत पार्नु पर्छ । 

आपूर्ति श्रखला र व्यापार अवरोध

१. नेपाल सरकारले हवाई उडानको परिचालनमा अन्तर्राष्ट्र्यि मान्यता अनुसार समन्वय र सहकार्य गर्नु पर्दछ ।

२.नेपाल सरकारले अत्याबश्यक अत्यावश्यक औषधीहरुको आपूर्तिमा निर्यात नियन्त्रण लगायत,रोक्ने व्यवस्था हटाउन संम्बन्धित सरकार संग पहल गर्नु पर्दछ ।

३. कोभिड १९ फन्डको प्रयोगको तौर तरिका छिटो तय गरिनु पर्दछ ।

४. अन्तराष्ट्र्यि उडान कहिले देखि खुल्ला  गर्न सकिन्छ त्यो विदेशी सरकार र निकाय संग छलफल गर्नु पर्दछ ।

५ वस्तु सेवाको आपूर्तिमा नियमितता आउनु पर्दछ ।

 

व्यवशायिक क्रियाकलाप र राजश्व

 

  • नेपाल सरकारले कर तिर्ने अवधी १ बर्ष अवधि सम्म बढाउनु पर्दछ ।
  • बैंकहरुले रीड को अवधि.१ बर्ष पछिकोलागी च्भ क्भअजभमगभि  गर्ने व्यवस्था मिलाउनु  पर्दछ ।
  • कुनै कंम्पनीले आफ्रनो कर्जाको पुनंसरचना गर्न चाहन्छ भने नेपाल राष्ट्र् बैंक र संम्बन्धित बैंकले त्यसमा सहयोग गर्नु पर्छ । यसै गरी केद्रिय वैकले पुनंकर्जाको व्यवस्थालाई थप विस्तार र सहज वनाउनु पर्दछ । समस्यामा परेका साना उद्यमी र पर्यटन व्यवसायी लक्षित पुनंकर्जा कार्यक्रम केद्रिय बैंकले ल्याउनु जरुरी छ ।
  • साना तथा मझौला उद्यमी व्यवशायीले लिएको ऋ०ाको ग्रेस पिरियथप गरिनू पर्द५ ।
  • धितो पत्र वोर्डले क्ष्एइ कंम्पनिहरुले पंूजीबजारमा पहुच अवधिलाई र क्षमतालाई समेत सुदुढ गर्नु पर्दछ ।
  • विदेशमा जाने श्रमिकहरुको बारेमा श्रमिक आयात गर्ने मुलुक संग सहकार्य गरि रेमिट्रयान्सको रकम कमी नआउने दृष्टिले क्रियाकलाप वढाउनु पर्दछ ।
  • पर्यटन तथा होटेल व्यवशायको लागी विशेष सुविधाको प्याकेज आउनु पर्दछ ।
  • सिमावर्ति भन्सारमा आएका माल वस्तुको डेमरेज,डिटेन्सन् चार्जमा पूर्णत छुट हुनु पर्ने ।
  • वैंक तथा वित्तीय संस्थावाट दिएका कर्जाको व्याजदरमा सहुलियतपूर्ण व्यवस्था हुनु पर्ने ।
  • तरलताको सहज उपलब्धता र ऋयकत या ँगलम घटाउन एयष्अिथ च्बतभ घटाउनु पर्ने ।
  • क्रेडिटको सिमा २५ प्रतिशतले बढाउनु पर्ने ।
  • वित्तीय घाटाको लक्षलाई केद्रित नगरी आर्थिक विकासमा जोड दिने र सरकार र राजश्ज उठ्ति र पूंजिगत खर्च बीचको तालमेल हेर्न नहुने ।
  • सार्वजनिक संस्थानमा उल्लेखनिय खर्च नगरी कोभिड १९ बाट माक्स मेडिकल किटहरु स्वस्थ सेवाका, स्वास्थ्य केन्द्र र हस्पीटलमा प्रदान गर्ने ।
  • श्रमिकहरुले आफ्नो कार्यहरुवाट उन्मूतिm पाउने संभावना रहने हुंदा त्यस्ता व्यतिmलाई काममा लगाई राख्न सरकारले विशेष प्रोत्साहन प्रदान गर्नु पर्ने ।खाद्यान्न र औषधीमा भन्सार पूर्णत छुट हुनु पर्ने ।
  • गलत सूचना संम्पे्रषणबाट आतंक भय र डरको स्थिति सृजना भएको हुंदा सूचना संम्प्रेषण गरीनेमा गभिता अपनाउनु पर्ने ।
  • आवश्यकता र अनिबार्येता वाहेक वजेट खर्च ३ महिना भित्र नगर्ने व्यवस्था हुनु पर्ने ।

 

यी माथीका उल्लेखित सुझावहरु अपनाउनु पर्ने कदमले समग्र  मुलकमा रहेका विभिन्न आकारका व्यवशायमा तरलताको वृद्धि भै कोरना भाईरसवाट अल्पकालमा भएको घाटा नोक्सानी र असहज परिस्थितिको सामना गर्न  केहि मात्रामा भए पनि सहज हुने आशा एवं विश्वास छ ।

नोवल कोरोना भाइरस बिस्वब्यपी महामारी विरूद्ध लड्न तथा प्रकोप नियन्त्रण गर्न  प्रमुख रणनीति स्वरुप नेपाल सरकारले लकडाउन आदेश जारी गरेको विदितै छ । स्वास्थ्य संकटको यो घडीमा आ आफ्नो तर्फबाट स्वास्थ्य संस्था एवं स्वास्थ्यकर्मीको हौसला बढाउने कार्यमा आवश्यक सहयोग गर्न अवास्यक र अनिवार्य छ I

भारत र चीनका नाकामा रोकिएका कच्चा तथा तयारी वस्तुको अनलोड र ढुवानीको वन्दोवस्त मिलाई अत्यावश्यक वस्तुको उत्पादन र वितरण प्रणालीलाई सुचारु राख्ने आवश्यक व्यवस्था मिलाउनु पनि उतिकै अवास्यक छ I

हालको परिस्थितिलाइ दृष्टिगत गरी तत्काल उद्यमी व्यवसायीले दाखिला गर्न पर्ने आयकर तथा मूल्य अभिवृद्धि कर हालको यस बिषम  परिस्थितिलाइ मनन गरी हाललाई समस्याको समायवधि हेरी अल्पकालीन तथा दीर्घकालीन प्याकेजको व्यवस्था गर्नु पर्ने, सीमावर्ति भन्सारमा आएका तथा आउने माल वस्तुको डेमरेज, डिटेन्सन् चार्जमा पूर्णतः छुट हुनु पर्ने, भुक्तानी भएको कारोबारमा मात्र मूल्य अभिवृद्धि कर लिने व्यवस्था हुनु पर्ने, बैंकहरुले ऋणको भूतmानीको अवधि रि सेडुयुलिङ्ग गर्ने व्यवस्था मिलाउनु पर्ने, वैंक तथा वित्तीय संस्थावाट लिइएको कर्जाको व्याजदरमा कम्तिमा ५ प्रतिशत सरकारी अनुदान, २ प्रतिशत  वैंकबाट सहुलियतको व्यवस्था हुनु पर्ने देखिन्छ  । साथै कोरोना प्रभावित पर्यटन तथा होटेल व्यवशायको लागि विशेष सुविधा सहितको प्याकेज ल्याउन समेत  निजि क्षेत्र ले अनुरोध गरेको छ ।

 

Expectations from the Newly Appointed Indian Envoy!

Nepal, India: Easy or Uneasy Partners

 

Even small families develop misunderstandings so it is but natural to expect that apprehension will definitely occur when the relations between two countries are concerned. Therefore the important issue is not whether disputes arise or not; the important issue is how swiftly and effectively these issues and irritants are addressed.

 

 

kwatra picture

 

Shanker Man Singh

MBA, PGDIM (Delhi School of Economics), TIS ( Bangkok), SEC ( USA)

 

India has named Vinay Mohan Kwatra, currently its ambassador to France, as its new envoy to Nepal. According to reliable sources, the Indian Ministry of External Affairs (MoFA) recently wrote to the Ministry of Foreign Affairs in this connection. It is learnt that the new Indian envoy will be arriving in Kathmandu to take up his new diplomatic assignment in February. Kwatra is replacing Manjeev Singh Puri. A look at his profile shows, Kwatra joined Indian Foreign Service in 1988 and worked in various capacities at MEA and India’s diplomatic missions abroad. Before being assigned to Kathmandu mission, he was the Ambassador to the European Union, Belgium and Luxembourg. Born in 1959, Puri had joined the Indian Foreign Service in 1982.

Kwatra is a member of the Indian Foreign Service with an experience of nearly 30 years in a range of assignments. Between 1993 and 2003, he served as Desk Officer at Headquarters dealing with United Nations, and subsequently in the Diplomatic Missions in South Africa and Uzbekistan.

Nepalese are of the belief and are confident that  favorable and conducive cooperation will be forthcoming for maintaining peace, stability and development in days to come.  Since H.E. Ambassador has served as the Chief of the Economic, Trade while in SAARC Secretariat, we are confident that he is fully aware about Nepal’s situation, particularly of the business community. Private sector are confident and would like to request the ambassador to emphasize to their government that trade and economic issues between Nepal be accorded special attention to Nepal’s LDCs status as Nepal has planned to graduate from LDC to the developing country by 2022 and the group of middle income countries by 2030.

With the global and other bilateral issues overwhelming His Excellency, Nepali private sector understands that the trade and economic related issues will become a very small part of his daily business, but they are hopeful that even a small attention will be very helpful in putting before Indian government the hopes and aspirations of not only the business community of Nepal but also of the average Nepalese citizens..

 

The visits of the Indian Prime Minister Mr.Modi to Nepal and the visit of Nepalese President and the Prime Minister K.P Oli to India  are some of the vivid reminders of the subsisting ties between Nepal and India.

Nepal needs to broadly utilize the economic and trade opportunities available in India, but it has not been able to do so due to problems like:  weak productive capacity, inadequate infrastructure, low foreign direct investment, Lack of effective institutional mechanisms to address the imminent issues. Inefficient trade facilitation infrastructure including complex rules and regulations, Lack of coordination among trade and transport agencies, non-harmonized reporting of trade data. Absence of an accreditation board, and low margins of preference, IGC and IGSC more formal than business like The Small Scale Industries (SSI ) products are facing difficulties in export on account of complexities in the rules of origin criteria; Definition of SSI products to be made compatible with the provisions of Industrial Policy-2010

 

Oil pipeline has proved to be a boon for the economy. Nepal-India cross border petroleum pipeline project is coming closer to reality after more than 20 years in the planning. Gasoline [petrol, diesel and kerosene] started flowing.  Regarding Fruits and vegetable import from India, taking into consideration the people to people relationship, Indian government help, cooperation is expected in establishing modern quarantine and pesticide check posts.

                         In the case of the Technical Assistance  disbursement, Nepalese are of the view, which might take some time to conceptualize and implement, a mechanism of G to B be developed like DFID, USAID funded project so that the fund could be channeled to the recipient in a more effective and efficient way without much hassles. This will have more visibility and the impact will also be more.

Business of India has grown significantly. In the last couple of years. The benefits should also be taken equally from Nepal as well. But how? Let us discuss on the modalities. Capacity development programme to be launched to the relevant stakeholders associated with trade logistics. Management of Infrastructure like ICDs/ICPs under Nepalese private sector. Incorporate shipping in treaty of trade and transit.  Despite the progress in trade logistics, Nepali traders are still facing a number of hurdles while transporting goods through Indian land: Increasing traffic at Kolkata Port, unavailability of adequate number of railway rakes, congestion at Birgunj Inland Container Depot, lack of full-fledged operation of Birgunj Integrated Check Post and excessive documentation process, among others, were the main concerns.

Nepal bound cargos have to fulfil compliance procedures under 37 different documentation steps, which takes an additional 3-4 days. “There is a need for enforcing a single window system and validation of the online documentation to reduce the number of days in cargo movement,”

Bulk cargo issue– should be open in other points like Ruphedia/Nepalgunj, Belahiya/ Sunali, Jogbani/ Biratnagar other than Raxaul/ Birgunj Expedite Construction and implementation of Integrated Check Post (ICP). Implementation of an Electronic Cargo Tracking System, Nepal should optimally use the Vishakhapatnam port and ask for the Dharma port for future transit transport. Major  issues to be addressed for the  effective operationalization of Vizag port for Nepal are:  Due to unavailability of Nepal Consulate at Vizag port the documents are routed through Nepal Rashtra Bank in turn to trigger “go ahead” to Vizag customs from Nepal Embassy in New Delhi. This entire process is cumbersome and time consuming.

Nepal is facing a huge trade deficit with India, which is a grave concern for the economic and sustainable development of Nepal. So, we are looking forward for the Indian Government’s help in this regard. In terms of waving Non-Tariff Measures, Accreditation, bulk cargo issue.

To the Nepali Government, Nepali private sector would like to request to create an environment favourable for foreign investors in order attract them to Nepal. That needs, fore and foremost, political stability, security, infrastructure, and friendly policies.

To the Indian Government, our request would be to ensure reciprocal business relations. It can help by creating favourable environment for export of Nepali products to the Indian market. We, the private sector, wish to operate in a free and fair environment where both the governments work in harmony to promote and open-heartedly welcome our investments — both in India and Nepal.

To the Indian investors, we would like to say that there are enormous prospects of working in Nepal. This is the right time to invest in mega projects in Nepal, especially when we are talking about helping Nepal rebuild and the formation of various Acts and One window system in operation.

Because of its strategic geographical placement, Nepal could be an ideal location for the Indian private sector to base their businesses. From Nepal, they can tap into the markets of the two most populous countries of the world at once – India and China. Apart from that, there is always a local Nepali market. If you have any doubts about the returns to investment from Nepal, we would like you to look at the success stories of Ncell, Dabur, Unilever, Surya Nepal that are doing wonders with comparatively little investment in Nepal.

There are great opportunities in the hydropower sector. Indian companies have already entered Nepal’s hydroelectric projects. We have a potential of developing about 83,000 megawatts of hydroelectricity in Nepal, which is yet to be explored fully. There is also a great prospect of constructing an east-west railway line along the southern length of Nepal, as well as north-south highways facilitating Indo-China trade.

Imagine – people visiting Nepal to climb Mount Everest take a cable car from the base camp to descend to the Mahabharat hills, from where they take a bus ride to Nepal’s Terai enjoying the breathtaking views of the hills all the while. From the Terai, they catch a direct express train to Taj Mahal. Who wouldn’t like to come to such a trip? Imagine – people visiting Bodhgaya make a Buddhist circuit in India in a bullet train and reach Nepal’s Lumbini, from where they take a helicopter flight to the great Boudhanath Stupa in Kathmandu, and trek to the northern Himalayan monasteries of Mustang.

Use the feedback from the businesses and industries as input in devising the negotiating strategies. A committee comprising of the Nepali private sector business community and the Indian business community be formed to recommend to the government on the policy, trade, transit and daily operation issues. In the past such forum recommendations were well taken by both the Government.

Indian Embassy in Kathmandu deserves credit for ever willing support and sympathy  to  address the grievances of the business community in Nepal. As the Indian mission here, went even beyond the call of duty to immediately take up the issues of trade related irritants and try to solve them effectively.

For food items the lab test facilities have to be developed in both sides. For the import of Indian vegetables and fruits to Nepal, Indian government help and co-operation is sought in the infrastructure with latest technology. Similarly, Nepali ginger, tea, large cardamom, MNC like Dabur, Uniliver products should have easy access to India having the lab test and the excellent quarantine office.

Nepal and India both the countries should follow the principle of “prosper thy neighbor” policy by which it will stop migration, increases employment opportunities and increase market.
Unauthorized trade between Nepal and India has also a negative impact to both the countries so the formal trade should be encouraged for the mutual benefit of both the countries.  On the FDI aspect, when we talk about Indian investment in Nepal, we should not only see what we have achieved, we should also focus more on the prospects and opportunities that lie ahead.  The issue of IC crunch and the ballooning trade deficit and increasing import of the POL products are the matter of concern to be addressed.
Even small families develop misunderstandings so it is but natural to expect that apprehension will definitely occur when the relations between two countries are concerned. Therefore the important issue is not whether disputes arise or not; the important issue is how swiftly and effectively these irritants are addressed. If projects such as the Pancheswor, Arun III, Upper Karnali and Koshi hi-dam are completed, Nepal will be self-reliant on energy and irrigation.

Mr. Kwatra, a seasoned diplomat, as a new Indian envoy to Nepal once assumes office in
Kathmandu; his immediate challenge will be observing the Transit Treaty, help assist in adjusting ever increasing trade gap, hydro power development including the transmission line and the issue of Kalapani, among others.
To sum up, our very best wishes to the newly appointed ambassador Mr. Kwatra!

-Expectations from the  Newly Appointed Indian Envoy-

Nepal, India: Easy or Uneasy Partners

 

Even small families develop misunderstandings so it is but natural to expect that apprehension will definitely occur when the relations between two countries are concerned. Therefore the important issue is not whether disputes arise or not; the important issue is how swiftly and effectively these issues and irritants are addressed.

 

 

kwatra picture

 

Shanker Man Singh

MBA, PGDIM (Delhi School of Economics), TIS ( Bangkok), SEC ( USA)

 

India has named Vinay Mohan Kwatra, currently its ambassador to France, as its new envoy to Nepal. According to reliable sources, the Indian Ministry of External Affairs (MoFA) recently wrote to the Ministry of Foreign Affairs in this connection. It is learnt that the new Indian envoy will be arriving in Kathmandu to take up his new diplomatic assignment in February. Kwatra is replacing Manjeev Singh Puri. A look at his profile shows, Kwatra joined Indian Foreign Service in 1988 and worked in various capacities at MEA and India’s diplomatic missions abroad. Before being assigned to Kathmandu mission, he was the Ambassador to the European Union, Belgium and Luxembourg. Born in 1959, Puri had joined the Indian Foreign Service in 1982.

Kwatra is a member of the Indian Foreign Service with an experience of nearly 30 years in a range of assignments. Between 1993 and 2003, he served as Desk Officer at Headquarters dealing with United Nations, and subsequently in the Diplomatic Missions in South Africa and Uzbekistan.

Nepalese are of the belief and are confident that  favorable and conducive cooperation will be forthcoming for maintaining peace, stability and development in days to come.  Since H.E. Ambassador has served as the Chief of the Economic, Trade while in SAARC Secretariat, we are confident that he is fully aware about Nepal’s situation, particularly of the business community. Private sector are confident and would like to request the ambassador to emphasize to their government that trade and economic issues between Nepal be accorded special attention to Nepal’s LDCs status as Nepal has planned to graduate from LDC to the developing country by 2022 and the group of middle income countries by 2030.

With the global and other bilateral issues overwhelming His Excellency, Nepali private sector understands that the trade and economic related issues will become a very small part of his daily business, but they are hopeful that even a small attention will be very helpful in putting before Indian government the hopes and aspirations of not only the business community of Nepal but also of the average Nepalese citizens..

 

The visits of the Indian Prime Minister Mr.Modi to Nepal and the visit of Nepalese President and the Prime Minister K.P Oli to India  are some of the vivid reminders of the subsisting ties between Nepal and India.

Nepal needs to broadly utilize the economic and trade opportunities available in India, but it has not been able to do so due to problems like:  weak productive capacity, inadequate infrastructure, low foreign direct investment, Lack of effective institutional mechanisms to address the imminent issues. Inefficient trade facilitation infrastructure including complex rules and regulations, Lack of coordination among trade and transport agencies, non-harmonized reporting of trade data. Absence of an accreditation board, and low margins of preference, IGC and IGSC more formal than business like The Small Scale Industries (SSI ) products are facing difficulties in export on account of complexities in the rules of origin criteria; Definition of SSI products to be made compatible with the provisions of Industrial Policy-2010

 

Oil pipeline has proved to be a boon for the economy. Nepal-India cross border petroleum pipeline project is coming closer to reality after more than 20 years in the planning. Gasoline [petrol, diesel and kerosene] started flowing.  Regarding Fruits and vegetable import from India, taking into consideration the people to people relationship, Indian government help, cooperation is expected in establishing modern quarantine and pesticide check posts.

                         In the case of the Technical Assistance  disbursement, Nepalese are of the view, which might take some time to conceptualize and implement, a mechanism of G to B be developed like DFID, USAID funded project so that the fund could be channeled to the recipient in a more effective and efficient way without much hassles. This will have more visibility and the impact will also be more.

Business of India has grown significantly. In the last couple of years. The benefits should also be taken equally from Nepal as well. But how? Let us discuss on the modalities. Capacity development programme to be launched to the relevant stakeholders associated with trade logistics. Management of Infrastructure like ICDs/ICPs under Nepalese private sector. Incorporate shipping in treaty of trade and transit.  Despite the progress in trade logistics, Nepali traders are still facing a number of hurdles while transporting goods through Indian land: Increasing traffic at Kolkata Port, unavailability of adequate number of railway rakes, congestion at Birgunj Inland Container Depot, lack of full-fledged operation of Birgunj Integrated Check Post and excessive documentation process, among others, were the main concerns.

Nepal bound cargos have to fulfil compliance procedures under 37 different documentation steps, which takes an additional 3-4 days. “There is a need for enforcing a single window system and validation of the online documentation to reduce the number of days in cargo movement,”

Bulk cargo issue– should be open in other points like Ruphedia/Nepalgunj, Belahiya/ Sunali, Jogbani/ Biratnagar other than Raxaul/ Birgunj Expedite Construction and implementation of Integrated Check Post (ICP). Implementation of an Electronic Cargo Tracking System, Nepal should optimally use the Vishakhapatnam port and ask for the Dharma port for future transit transport. Major  issues to be addressed for the  effective operationalization of Vizag port for Nepal are:  Due to unavailability of Nepal Consulate at Vizag port the documents are routed through Nepal Rashtra Bank in turn to trigger “go ahead” to Vizag customs from Nepal Embassy in New Delhi. This entire process is cumbersome and time consuming.

Nepal is facing a huge trade deficit with India, which is a grave concern for the economic and sustainable development of Nepal. So, we are looking forward for the Indian Government’s help in this regard. In terms of waving Non-Tariff Measures, Accreditation, bulk cargo issue.

To the Nepali Government, Nepali private sector would like to request to create an environment favourable for foreign investors in order attract them to Nepal. That needs, fore and foremost, political stability, security, infrastructure, and friendly policies.

To the Indian Government, our request would be to ensure reciprocal business relations. It can help by creating favourable environment for export of Nepali products to the Indian market. We, the private sector, wish to operate in a free and fair environment where both the governments work in harmony to promote and open-heartedly welcome our investments — both in India and Nepal.

To the Indian investors, we would like to say that there are enormous prospects of working in Nepal. This is the right time to invest in mega projects in Nepal, especially when we are talking about helping Nepal rebuild and the formation of various Acts and One window system in operation.

Because of its strategic geographical placement, Nepal could be an ideal location for the Indian private sector to base their businesses. From Nepal, they can tap into the markets of the two most populous countries of the world at once – India and China. Apart from that, there is always a local Nepali market. If you have any doubts about the returns to investment from Nepal, we would like you to look at the success stories of Ncell, Dabur, Unilever, Surya Nepal that are doing wonders with comparatively little investment in Nepal.

There are great opportunities in the hydropower sector. Indian companies have already entered Nepal’s hydroelectric projects. We have a potential of developing about 83,000 megawatts of hydroelectricity in Nepal, which is yet to be explored fully. There is also a great prospect of constructing an east-west railway line along the southern length of Nepal, as well as north-south highways facilitating Indo-China trade.

Imagine – people visiting Nepal to climb Mount Everest take a cable car from the base camp to descend to the Mahabharat hills, from where they take a bus ride to Nepal’s Terai enjoying the breathtaking views of the hills all the while. From the Terai, they catch a direct express train to Taj Mahal. Who wouldn’t like to come to such a trip? Imagine – people visiting Bodhgaya make a Buddhist circuit in India in a bullet train and reach Nepal’s Lumbini, from where they take a helicopter flight to the great Boudhanath Stupa in Kathmandu, and trek to the northern Himalayan monasteries of Mustang.

Use the feedback from the businesses and industries as input in devising the negotiating strategies. A committee comprising of the Nepali private sector business community and the Indian business community be formed to recommend to the government on the policy, trade, transit and daily operation issues. In the past such forum recommendations were well taken by both the Government.

Indian Embassy in Kathmandu deserves credit for ever willing support and sympathy  to  address the grievances of the business community in Nepal. As the Indian mission here, went even beyond the call of duty to immediately take up the issues of trade related irritants and try to solve them effectively.

For food items the lab test facilities have to be developed in both sides. For the import of Indian vegetables and fruits to Nepal, Indian government help and co-operation is sought in the infrastructure with latest technology. Similarly, Nepali ginger, tea, large cardamom, MNC like Dabur, Uniliver products should have easy access to India having the lab test and the excellent quarantine office.

Nepal and India both the countries should follow the principle of “prosper thy neighbor” policy by which it will stop migration, increases employment opportunities and increase market.
Unauthorized trade between Nepal and India has also a negative impact to both the countries so the formal trade should be encouraged for the mutual benefit of both the countries.  On the FDI aspect, when we talk about Indian investment in Nepal, we should not only see what we have achieved, we should also focus more on the prospects and opportunities that lie ahead.  The issue of IC crunch and the ballooning trade deficit and increasing import of the POL products are the matter of concern to be addressed.
Even small families develop misunderstandings so it is but natural to expect that apprehension will definitely occur when the relations between two countries are concerned. Therefore the important issue is not whether disputes arise or not; the important issue is how swiftly and effectively these irritants are addressed. If projects such as the Pancheswor, Arun III, Upper Karnali and Koshi hi-dam are completed, Nepal will be self-reliant on energy and irrigation.

Mr. Kwatra, a seasoned diplomat, as a new Indian envoy to Nepal once assumes office in
Kathmandu; his immediate challenge will be observing the Transit Treaty, help assist in adjusting ever increasing trade gap, hydro power development including the transmission line and the issue of Kalapani, among others.
To sum up, our very best wishes to the newly appointed ambassador Mr. Kwatra!

 

 

 

 

Promoting Nepal – Russia Economic Relations

  • Nepal and Russia established the diplomatic ties on July 20th Nepal extended full and formal diplomatic recognition to the Russian Federation as a sovereign country on December 28, 1991 soon after the disintegration of the USSR.
  • Russia had been helping Nepal to march towards economic self-reliance since the establishment of the diplomatic ties between Nepal and the Russia.
  • The bilateral relations between Nepal and Russia is based on mutual understanding, trust and
  • Nepal is constantly facing trade gap with Russia. In 2017, Nepal faced a trade gap of 9 million US dollar showing the import figure at 11.47 million US dollar and  million Nepalese rupees and the export to the tune of  7 million US dollar. In 2018, the trade deficit increased to 28 million shoeing import at 30  million US dollar and export to the tune of 1.57 million US dollar. .
  • Nepal needs to export more to bridge the ever-increasing trade gap.
  • Nepal’s major export items include: hand knotted woolen carpets, woolen shawls, scarves, mufflers, mantillas, veils and the like. Nepal could export tea, and handicrafts including pashmina shawls to Russia.
  • Nepal’s import from Russia include Aeroplane and helicopters, parts and accessories, Gear and bearings, Parts and accessories for motor vehicle, lighting or visual signaling equipment, aluminum, not alloyed. Nepal could import Russian Chemical Fertilizers and Metals in a very competitive price.
  • In an average about two thousand tourists visits the Nepal every year. Nepal is participating in some Tourism fairs in Russia since past few years.
  • When we look at the history of Nepal- Russia cooperation, Russia was the first country to promote tourism in Nepal. The peak of the economic co-operation was in the 1970s when we see the construction of East West Highway, set up factories and hydro power plants.
  • In the history of bilateral relations, Russia has made significant contributions in the economic and social development of Nepal by building roads. Panauti Hydro Power Plant, Kanti Children’s Hospital, Birgunj Sugar Factory, Agriculture Tools Factory , and Janakpur Cigarette Factory. Moreover, about 10,000 plus Nepalese have graduated from various Universities of the erstwhile Soviet Union and present Russian Federation and many among them hold important positions in Nepal, contributing a lot to the development of the country. Number of students has passed from Russia in different discipline.
  • There is a chance of opening new avenues for economic development through increase in trade, investment and joint ventures.
  • The emergence of Nepal as a transit country for trade between China and India should help draw Russian investments in the construction of north-south highways, railways, including tunnels, to convert them into speedways of regional importance.
  • The scope of Russian investment in Nepal could grow and products of Russian joint ventures in Nepal could have easy access to the markets of China and the SAARC Countries. If Russia were to help Nepal build the necessary infrastructure for this type of transit corridors, it could result in the transformation of the spirit of the trilateral meetings between Russia, China and India in expanding the benefits to the continent as a whole while also linking up with Europe.
  • During the days of the Perestroika and largely after the collapse of the USSR many Nepalese nationals who had come to Russia as students have started to engage themselves in businesses.
  • Since currently Nepali Parliament has passed the Industrial Enterprise Act, SEZ Act and other relevant acts like Labor Act , Contribution based Social Security Act and the Foreign Investment Act, Public Private Partnership and Investment Act, it is hoped that it will be instrumental in achieving the FDI.
  • Bilateral consultation should be revitalized and regularized by which new areas of co-operation between the two countries could be determined and promoted.

Chinese President Xi’s visit to Nepal: A milestone

 

 

shanker man singjh

By  Shanker Man Singh

Chinese President Xi Jin Ping  is visiting Nepal after completing  his India visit. Just to recapitulate, Xiang Jemin was the last Chinese President to visit Nepal in 1996. There has been no Nepal visit of Chinese President after that. The then Chinese premier Wen Jiabao had visited Nepal in 2012. Minister Wang Yi came Nepal to prepare the grounds for President Xi’s visit .

The visit is hoped to broaden the basis of mutual friendship, understanding and confidence between the respective countries. The visit also aims at broadening contact, developing goodwill and forging new areas of cooperation.

Although Xi has already visited South Asian countries, including India, Pakistan, Sri Lanka, Bangladesh and the Maldives, his visit to Nepal was much awated eagerly.. In the meeting held with Nepalese President, Xi conveyed China’s support for the development of infrastructure, including cross-border railways under the Trans-Himalayan Multi-Dimensional Connectivity Network. “Xi said since the pre-feasibility study of the railway had already been completed, the feasibility study should be carried out based on consultations between the two countries,” Xi also assured Bhandari of China’s support in materializing Nepal’s resolve of ‘Prosperous Nepal, Happy Nepali,’ and to make Visit Nepal Year 2020 a success by encouraging more Chinese tourists to visit Nepal.

Connectivity remains at the core of this enterprise for particularly country like Nepal which is very important. We are talking connectivity is not only in terms of physical connectivity, connectivity of ideas, connectivity of trade, connectivity of people, connectivity of finance and the whole spectrum of the connectivity, all forms of connectivity and it is that basic motivation, that has driven Nepal’s participation in this very important initiative taken by President Xi Jinping.

On three tracks we could realize the benefit that this important initiative offers and in the days ahead perhaps the government in collaboration with the private sector and with the knowledge community could come up with some conclude idea to realize important opportunity that it offers. The main focus of the meeting between Xi and Bhandari , as it has been learnt will be expediting the Kerung-Kathmandu Railway project, among others.

To recapitulate, following bilateral talks, Bhandari and Xi witnessed signing of seven bilateral agreements, including the protocol to implement the Nepal-China transit transport agreement. The protocol, which will pave the way for implementation of the TTA, allows Nepal to use Shenzen, Lianyungang, Zhanjiang and Tianjin seaports, ending Nepal’s sole dependence on Indian ports for overseas trade. Nepal has also been allowed to use Lanzhou, Lhasa and Xigatse land ports. As per the protocol, Nepali traders will be allowed to use any mode of transport — rail or road — to access seaports for third-country trade.

Likewise,  two sides also inked Agreement on Cooperation and Mutual Administrative Assistance in Customs Matters, Memorandum of Understanding for Cooperation on Standardisation, Agreement on Economic and Technical Cooperation, Minutes of Meeting on Strengthening Assistance Cooperation in the Field of Livelihood in the Northern Region of Nepal, Agreement on Preventing Theft, Clandestine Excavation and Illicit Export Import of Cultural Property and Handover Certificate of Grant-Aid for the Repair and Reinforcement Project of the Existing China-aided Projects.

Under the Agreement on Economic and Technical Cooperation, China will provide Nepal a grant assistance of RMB 1 billion for the implementation of mutually agreed projects in the fields of livelihood improvement, post-disaster reconstruction and infrastructure. This visit will assess and review the progress, among others.   China is the second largest trading partner of Nepal. Nepal China economic relations began since fifth century which was formalized in 1956.  Since then, relations and trade has grown constantly and encouragingly. The geographic proximity and cultural commonalities has strengthened the relations and reached a new height today.

Nepal has exported goods worth NRs 2,422 million in 2018 compared to NRs 1,581 million  in 2009. During this period, export has increased by 53 percent. In this period, import reached to NRs 190,231 million  from the level of NRs 32,621 million  which indicates a growth of 463 percent. On the whole, Nepal’s trade with China increased by 483 percent during a decade.

Nepal’s trade gap with China widened with an export import ratio as 1: 99 in 2018 compared to export import ratio as 5: 95 in 2009.  Why Nepal’s balance of trade is worsening?  What are the prospects for better performance in Nepal’s export trade that are in favour of both countries? What are the issues in Nepal’s trade with China?  These are questions that require  through study China is a second largest economy in the world and a close trade partner of Nepal and it is  believed that China has goodwill and capacity to assist Nepal for its trade promotion that are in favor of  both countries.

Just to recapitulate during the Nepalese PM’s visit to China last year in the programamme organized by CCPIT he said and is quoted, “We can create a symbiotic relationship in business sector between our two countries, which would be a situation of win-win collaboration.” Nepali people take this meeting as a continuation and have further importance at the high level.

          China has given zero tariff entry facility to over 8000 Nepali products starting from 2009, Nepal hasn’t been able to bring the trade deficit down. Nepal exports 370 products including noodles and agro products to China. Nepal regularly participates various trade fairs and exhibitions organized in China.

          Although China has become one of the major trading partners of Nepal, Nepal has a huge trade deficit with China. Hence, it is necessary to promote the export of Nepali products to China to bridge the gap. Removal of non-tariff barriers (mutual accreditation arrangements, entry-exit inspection and simplified quarantine rules and regulations at the entry points including mainland China, simplification of customs procedures, etc) can be effective tools to bridge the divide.

          Recently Nepal has successfully completed the Nepal Investment Summit where about 15 projects were signed for further implementation. As such, investing in Nepal, now, is really a profitable business. The government is determined to maintain an investment friendly environment, not by word but by action with the regulatory changes. Nepal is a virgin land for investment.

A land of immense potentials for investment in the areas of hydropower, agriculture, tourism, services, manufacturing industries, among others.  China remains the largest source of FDI in Nepal.  There is a favorable fiscal environment in Nepal too.  Nepal has low tax slabs, no income tax on earnings of industry exporting its products established in Special Economic Zones for certain period of time, exemption of tax and tax holidays for certain industries, exemption of duty and fees on the key inputs used by an export Industry.

          Private sector investment is expected in industry, energy, physical infrastructure, housing, Urban Infrastructure and Tourism. Recent Policy reforms in Foreign Investment and Technology Transfer Act, Company Act, Industrial Enterprises Act, Labor Act, Intellectual Property Rights Policy, One Window Service delivery, BAFIA, etc. are conducive for creating business friendly environment in Nepal.

          Nepali industries enjoy preference in exports as non-LDC countries the direct or joint venture investment on Nepali agriculture, mineral, textiles, leather, cement, hydropower and food processing industries deserve comparative advantage. As Nepali products enjoy duty-free and quota-free access to EU and other countries, if China and representative countries of this forum could invest in Nepal, the products could easily be exported to Lhasa, China and other countries overseas.

          China is the 2nd largest source of foreign tourist to Nepal. Over 137 thousand Chinese tourists visit Nepal annually. China has designated Nepal as the first tourist destination in South Asia for its people.  Nepal’s law permits full repatriation of income earned from investment and reinvestment. Foreign companies registered in Nepal can purchase, own and sell land. No discrimination is made between national and foreign investors. There is no policy of nationalization of private industry. The other factor that makes competitive in Nepal is availability of cheaper labour force and improved labour law and industrial relations.

Despite an agreement between the central banks of Nepal and China to promote trade by modern modes of payment — banking channels like letter of credit and advance TT payment — there are many constraints due to which a large number of Nepali tradesmen have not benefited from this arrangement. In one way, the trade between Nepal and Tibet is based on reciprocity. Until we develop L/C (Letter of Credit) practice along with insurance, delivery and payment bills through banking channel, there is no possibility of substantial increase in trade transactions.

The potential projects for development are:  Kathmandu Valley Metro Project, East West Railway Link to India Project, Chemical Fertilizer Plant, Kathmandu- Kulekhani Hetauda Tunnel Highway, Tamakoshi Hydro Power Project, Tamakoshi 3 Hydropower Project,  GoN is also conducting Feasibility Study on:  Luxury Resort in Shy Phoksundo National Park,  SKI  Resort Manang, Education, Health and Sports City, and  Integrated Agriculture Programme.

Mutual esteem, tolerance and perseverance from both the countries are required towards this end.

_____________________________________________

Mr. Singh has done MBA from Delhi School of Economics and a former CEO NEPSE and Executive Director of SEZDA.

 

 

 

 

Tribute to Sushma Swaraj from Nepal

Late Sushma Swaraj was first Indian minister to visit Nepal after the conclusion of the elections after New Constitution in Nepal . What a tall leader who received so much adulation and admiration when alive and that only triples into deep mourning in her sudden departure.
A rare kind of woman, politician, minister, leader and above all a great person. She was a true friend of Nepal .
 
May the departed soul rest in eternal peace. Heartfelt condolences to the bereaved family and the countrymen.sushma

Timely visit of PM for  Consolidating bilateral ties

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On the occasion of the Prime Minister K.P Olli’s Visit to Vietnam and Cambodia;

Timely visit of PM for  Consolidating bilateral ties

By Shanker Man Singh

Prime Minister KP Sharma Oli will visit Vietnam and Cambodia at the invitation of Vietnamese Prime Minister Nguyn Xuân Phúc. The   high level visit aims to promote investment in Nepal and promote tourism. Nepal has many things to learn from Vietnam’s rapid economic growth over the past 30 years of the country emerging from war. Likewise, majority of Vietnamese population  are Buddhist, promotion of religious tourism can be a key opportunity.  In Vietnam, PM Oli is also slated to take part in addressing the event on Vesarak

The visit is hoped to broaden the basis of mutual friendship, understanding and confidence between the respective countries. The visit also aims at broadening contact, developing goodwill and forging new areas of cooperation.

The areas of core competence of Nepali side are in the areas of: Tourism, Manufacturing, Infrastructure,  High Value Agriculture in the Hilly regions, Service Sector, Transit Route between India & China, the two giant economies of the world. These areas need to be given top most priority during discussion in the present visit  The visit will have importance as it is taking after the recent Nepal Investment Summit  2019 held after lots of regulatory changes.

 Business will not happen only because of goodwill or relationships. It will occur only if it makes business sense. Realizing the importance of investment, trade, the two sides  should agree that enhancing trade between Nepal, Vietnam and Cambodia is a priority for all the  countries.

 

          Nepal and Vietnam will celebrate the 45th anniversary of the establishment of diplomatic relations on May 15.       Nepal and Vietnam established diplomatic relationship in May 15, 1975. This is the starting point of our relationship and cooperation. There was numerous exchange of political delegations as well as trade exchanges. There is a growing need to prioritize such discussions so as to further consolidate the economic and trade ties between the two countries.

As such, Vietnam is one of the emerging economies in South East Asia which has achieved political stability following the conflict. During the prime minister’s visit, Nepalese delegation  will explore areas of cooperation with Vietnam in various fields including trade, culture and tourism, among others.

Just to recapitulate, on the sidelines of the recent World Economic Forum meeting in Davos, Prime Minister KP Oli had a bilateral meeting with the Prime Minister of Vietnam, H.E. Mr. Nguyen Xuan Phuc. The two leaders discussed various matters of Nepal-Vietnam relations. They underscored the need to enhance economic engagements in the areas of trade, investment, connectivity and tourism as well as the necessity to exchange high-level visits between the two countries.

Nepalese side has time and again expressing and requesting with Vietnam to ease the visa process and   urging  the Vietnam to consider in increased investment in Nepal’s agriculture, tourism, manufacturing, infrastructure and information technology, among others. This should be the focus of discussion during the high level visit.

About 7,000 Vietnamese tourists traveled to Nepal in recent year, most of them choosing spiritual tourism and eco-tourism.  There is an urgent need to encourage all travel and tour operators in Vietnam to cooperate with Nepali travel and tour operators to encourage Vietnamese people to visit Nepal, mainly Lumbini, and the birth place of Lord Buddha.

Since the Nepal’s government has already decided to celebrate 2020 as Nepal Tourism Year, the recent visit will contribute significantly to attract more Buddhist tourists from Vietnam to Nepal as majority of the people in Vietnam are Buddhists.

The trade turnover between the two countries is increasing every year. The major export products from Nepal to Vietnam are meat and meat offal, plants and parts of plants, vegetable products, handicraft items etc.

While the major imports from Vietnam are electric equipment’s, machinery, coffee, tea, mate and spices, beverages, fish, food products etc. More and more Nepalese businessmen are visiting Vietnam to explore different products for import. Vietnamese businessmen are also visiting Nepal for investment and importing Nepalese products.

Nepal is the country of high mountains and Himalayas, while there are lot of beautiful beaches and sea activities in Vietnam. There are potentials for the people of both countries to travel as tourists. Vietnamese people love to visit Nepal to see mountains and Himalayas and for adventurous activities like trekking, rafting, jungle safari etc. The visitors to Nepal are always overwhelmed with the natural beauty of Nepal and admires our hospitality, friendly behavior and love.

Visit to Cambodia:

It has been learnt that PM Oli will leave for Cambodia on May 13. PM is visiting Cambodia at the invitation of Cambodian Prime Minister Hun Sen who had visited Nepal during the Asia Pacific Summit, held in Kathmandu last year.

To recapitulate, in the past year the two countries had signed four agreements on the side-lines of the Asia-Pacific Summit 2018 in a move taking ahead bilateral ties, Nepal and Cambodia signed four new agreements that would enhance economic, diplomatic and economic ties between the two countries. The deal was signed during Cambodia Prime Minister Hun Sen’s last year’s visit to Kathmandu for the Asia-Pacific Summit 2018.. It is noteworthy that the two countries had also recently signed a new airlines agreement. The new agreements are expected to expand the existing cooperation between the two countries in the field of commerce, investments and tourism, owing to their proximity. Tourism and investment promotion would top agenda in bilateral talks in Cambodia as well.

Mutual esteem, tolerance and perseverance from both the countries are required towards this end.

Let me just quote what a famous South Asian, Mahatma Gandhi, said. “Happiness is when what you think, what you say, and what you do are in harmony.”

 

(Singh  is currently associated with the Projects under the Private sector. He was formerly Executive Director, Special Economic Zone (SEZ) and a Former General Manager/ CEO, Nepal Stock Exchange Limited (NEPSE). He holds Masters Degree  from Delhi School of Economics, University of Delhi  and US.

 

 

 

PM KP Oli’s visit to Vietnam and Cambodia: Some Reflections

Prime Minister KP Sharma Oli will visit Vietnam and Cambodia at the invitation of Vietnamese Prime Minister Nguyn Xuân Phúc.  The visit is hoped to broaden the basis of mutual friendship, understanding and confidence between the respective countries. The visit also aims at broadening contact, developing goodwill and forging new areas of cooperation.The   high level visit aims to promote investment in Nepal and promote tourism. Nepal has many things to learn from Vietnam’s rapid economic growth over the past 30 years of the country emerging from war. Likewise, majority of Vietnamese population  are Buddhist, promotion of religious tourism can be a key opportunity.  In Vietnam, PM Oli is also slated to take part in addressing the event on Vesarak

The areas of core competence of Nepali side are in the areas of: Tourism, Manufacturing, Infrastructure,  High Value Agriculture in the Hilly regions, Service Sector, Transit Route between India & China, the two giant economies of the world. These areas need to be given top most priority during discussion in the present visit  The visit will have importance as it is taking after the recent Nepal Investment Summit  2019 held after lots of regulatory changes.