Gap between rich and poor increasing: VP

Kathmandu, Jan. 30: Vice President Nanda Bahadur Pun Monday said on the face of it, the Nepalese economy seemed to be on track but  it was not satisfactory given that the gap between rich and poor had been ever increasing.

Addressing the 13^th conference of the South Asian Students of Economics organised by Nepal Economic Association (NEA) in the capital, he said, “Rich people have access to both the political and state powers. The situation is pathetic and can be improved through sustainable development, peace and economic prosperity.”

He called for the greater south Asian integrity with respect to each others’ sovereignty and independence.

“This region has the potential to be the economic centre of the world,” he said.

According to Pun, there were some national and regional challenges in the region that were hampering the development.

“If we charted out a common plan, it won’t take long to make the region prosperous. South Asian countries have multitudes of possibilities and resources,” he said.

Prof. Dr. Bishwambhar Pyakuryal, president of NEA, said that the conference would deliberate on various topics such as investment, regional integration, agriculture, trade, infrastructure, water resources and hydroelectricity.

“The conference will enhance fellowship and cooperation among the young economists in the region,” he said.

Embassy moves to its own building

Kathmandu, Jan. 30: The Embassy of Nepal in Bangkok has moved to its own building on Monday.

According to a press statement issued by the embassy, the new chancery was officially inaugurated with the hoisting of Nepali national flag jointly by ambassador Dr. Khaga Nath Adhikari and office bearers of Non-Resident Nepalese Association, Thailand and Thai-Nepali Association.

The new chancery is located at House No. 4/1, Soi Pridi Banomyang – 27, Sukhumvit 71 Road, Bangkok, and has started its services from the new location. 

Learning to eat!

A baby elephant learns to chew shoot in Chitwan. LuckyKally gave birth to
the baby a couple of months ago at Temple Tiger Green Resort. 

'Separate mechanism for expanding insurance to village'

Chiranjibi Chapagain

Chairman, Insurance Board                                                                                                                                    

Seven decades have elapsed since insurance companies came into existence in Nepal, but the industry is still struggling to find its feet. Low penetration and coverage of the people are the big challenges facing it despite its quantitative growth. Altogether there are 27 life and non-life insurance companies, but they have covered only 7-8 per cent of the people with a market size of Rs. 47 billion. Their financial governance, coverage of the rural people and the capacity of the regulating body are often called into scrutiny. As a regulating body, the Insurance Board has a responsibility to ensure the smooth growth and governance of the insurance companies.

Its newly-appointed chairman, Chiranjibi Chapagain, has batten down the hatches to boost the insurance industry. Chapagai did his MBA and EMBA from Tribhuvan and Purbanchal University and had served at the central bank for two-and-a-half decades. Modnath Dhakal of The Rising Nepal talked with Chapagain on a wide range of issues relating to the insurance market scenario, the role of the IB as a regulator, access to insurance, health insurance and capital increment of the insurance companies. Excerpts:

You worked in the banking sector regulator, Nepal Rastra Bank, for a long time and now have taken over the reins of the Board. How do you see your responsibility?

Banking and insurance are parts of the same financial system. If we view the international tradition of regulation, the core principles of the banking and insurance sector are the same although the banking industry is leading the financial market. Insurance is not a new area for me. On the other hand, the first insurance company in Nepal was established as a sister organisation of Nepal Bank Limited some 70 years ago. Insurance is also seen as a risk minimisation tool for the banks. But in terms of development, the insurance sector in Nepal is still lagging behind the banking sector.

What is your vision to strengthen the insurance sector?

My focus will be to reform the policy and institutional aspects to strengthen the sector. The Insurance Act, 1968 is unable to address the changes that the insurance industry has undergone over the decades. The draft of the new act has been prepared and submitted to the Ministry of Finance. If promulgated, it will strengthen the Insurance Board with greater independence, capacity enhancement and human resource management, and will address the loopholes on the part of the insurers. There are 27 insurance companies with more than 400 branches, but we have only around 40 employees, which are insufficient for monitoring, evaluating and preparing the reports. Sometimes, the Board may take over the management of the insurance companies, but we don't have enough human resources for this.

Some people still doubt that a banker can be an efficient insurance regulator. What is your take on this?

If I take the responsibility just for the sake of the job, they may be right. Although we have a 74-year history of insurance, it is still in the initial phase. I am aware that there are a lot of challenges in this sector, and I have come here to face them and improve the entire insurance sector.

What are your plans to enhance access to insurance in Nepal, which still hovers around 7 per cent?

People's access to insurance is not satisfactory. The present 7-8 per cent coverage was due to the mandatory 'Foreign Employment Term Insurance'. The total market size of both life and non-life insurance has reached only Rs. 47 billion so far. Therefore, I think that increasing the coverage of insurance is the major challenge. I would like to begin the process by enhancing the capacity of the IB so as to have better regulation and expand the insurance coverage of the rural and far flung areas as well. Discussions are underway to establish a separate mechanism to expand insurance to the rural and far-flung areas. Most of the insurance companies are concentrated in the urban areas, especially the large cities, and are reluctant to go to the villages. Establishing such a mechanism will be instrumental in enhancing the people's access to insurance services. For example, micro-insurance will also help in enhancing both the coverage and access. The new insurance act will open possibilities for such initiatives. We are hopeful that the act will be passed by the parliament in the current fiscal year.

There is talk about granting licenses to new insurance companies while some experts voice that the number of companies is already more than enough and they should be merged. Do we need more insurance companies?

Regulatory bodies should not issue licenses without studying the market potential and size, and should not force the companies to increase their capital without convincing conditions. We should see the market size and its growth rate before issuing license and capital increment. There is a dire need of a new licensing policy. Currently, there are insurance companies run by the government, private sector, foreign joint venture and branch offices, but there is no clear provision for foreign joint venture companies and to operate a branch of foreign insurance companies in Nepal. There is possibility for more private sector, joint venture companies and operating branches in the country. Their licensing, size of capital and procedural aspects must be clear in the policy.

What will be the role of the Insurance Board in promoting and regulating the 'Health Insurance Policy' announced by the government through the budget of the current fiscal year?

I have participated in a discussion on 'Health Insurance' with the government. I heard that the government has implemented the policy itself and plans to enhance the coverage by establishing a separate board. The IB has asked the government not to develop and implement any insurance service product without consulting the board because the Insurance Act, 1992 has provisioned that such endeavours should be taken in consultation with the IB. It is an international practice that governments can develop and implement such policies for the welfare of the people, but the policy and regulatory measures should be clear. The IB will also be included in the board for health insurance, according to the draft of the law being developed. We want to bring 'Health Insurance' under the umbrella of the IB.

 Payment of 'Fire Insurance policy', which also covers losses occurred due to earthquakes, looks good in terms of the number of cases, but large amounts of housing company policies are yet to be cleared. What is the IB doing in this regard?

Claims of individual houses have almost been cleared, but the problem lies in the case of apartments. I found confusion in this case because the insurance policy has covered the flat (apartment) of the families, but the lifts, stairs and other common facilities have not been insured. The Board is yet to see the details of such cases, but will try to resolve it as per the international practice. The IB has suggested that the insurers address the common facilities of an apartment also in their insurance policies.

Insurance companies are waiting for a policy to allow them to invest in large infrastructure projects to utilise their insurance funds. Are there any preparations in formulating a policy to allow them to invest in infrastructure projects?

Currently, insurance companies can invest 5 per cent of their funds in infrastructure projects, and they want to invest more in such projects. But it might create problems as long-term infrastructure projects don't give returns for a couple of years, and sometimes, in the case of Nepal, some of these projects are delayed for years with cost overruns. In such a situation, an insurer might be unable to pay the insured money to its clients. It is a sensitive sector.

The share market has seen a huge upheaval due to the rumour of capital increment of the insurance companies. The NEPSE index went up as the price of the shares of insurance companies shot up, but the index dipped with the insurance sub-index getting reduced by more than 600 points in the last few weeks. Isn't this anarchy?

Investors spread rumours that the paid-up capital of insurance companies would be raised to Rs. 4-5 billion. The draft of the new insurance act has this provision. Investment in the capital market should be for returns, not for gain, but investors in Nepal are concentrated on making gains from their investment. The IB will put in efforts not to allow anyone to benefit from such rumours in the future. I would like to inform every investor and the general people that the paid up capital of insurance companies won't be raised to Rs. 4-5 billion, it will be far below that.

 Insurance companies are accused of being poor in financial governance. What are your plans to improve the situation?

Every company must adhere to the rules for better financial governance. The IB won't compromise in this regard. It will implement tested rules and regulations from the international market to improve governance in the insurance companies along with the capacity building of the Board. Monitoring and evaluation will be conducted on a regular basis.

Insurance agents have succeeded in securing favourable decisions from the IB. Don't you think it will adversely affect financial governance in the companies?

The agents staged an agitation for six months and halted transactions in the companies. I asked them to hold discussion to find an amicable solution within a month. The decision has come as a temporary solution for a short period. A permanent solution will be sought at the earliest through dialogue.

Do you think the Nepalese going to India in search of work will be encouraged to get approval from the government as per the announcement of the Prime Minister last week?

This is not about issuing work permit to the workers and creating bureaucratic hassles before they leave the country in search of work. We are trying to create a mechanism to assign an identity to every Nepali who leaves the country for employment. After the implementation of this plan, Nepalese working in India will have the facility of insurance that will cover accident, critical diseases and even death, which will benefit the worker and his/her family. The announcement that the Prime Minister made last week will facilitate the workers abroad and their families here. 

(Published in The Rising Nepal daily.)

Ghost importers on rise

Kathmandu, Jan. 28: The number of ghost importers is increasing, and this has resulted in tax non-compliance, according to the Department of Customs (DoC).

Director general of the DoC Sishir Kumar Dhungana said that the VAT and income tax non-filers in import-export businesses reached about 32 and 50 percentage points respectively.

Talking to The Rising Nepal, he said, “It is difficult for us to identify the importers. There are importers who register a company in somebody else’s name as the owner, conduct business once or twice and disappear. Such ghost importers are difficult to identify and seldom exhibit compliance to the rules.”

According to the DoC estimates, there are 40 – 50 thousand importers in the country but their tax compliance is weak.

“Due to the weak tax compliance of the importing companies, the government doesn’t know whether such traders are in operation or not,” said Dhungana.

He stated that the department had been conducting tax-payers’ education programme to encourage such companies to comply with the rules.

To increase the tax compliance, the government is implementing Exim (export-import) code system from fiscal year 2017/18, whereby every importer and exporter should obtain the code certificate for their international trade.

Traders have to deposit Rs. 1 million as the bank guarantee for their import-export business.

Dhungana said that the new system, implemented as per the Customs Act, 2007, would address the menace of tax non-filing.

After the implementation of the new system, when the Exim code is entered into the customs, the details of traders, including their tax compliance records, can be obtained.

“If their tax payment is due, it will be recovered from the money deposited in their bank as a guarantee. The new system will create a linkage between import and domestic business,” said Dhungana.

However, president of the Nepal Chamber of Commerce Rajesh Kazi Shrestha said that he had no idea of the ghost importers.

“If there are such traders, the government should increase its surveillance against them and duly punish those flouting the laws and rules,” he said. 

BFIs in tizzy over AML measures compliance

Kathmandu, Jan. 27: Technology gap and inadequate understanding about the sources of customers' money are posing a big challenge to the banks and financial institutions (BFIs) in complying with the anti-money laundering (AML) measures, says a report entitled 'Anti-money laundering process maturity' of the country's banking sector.

"Of the compliance officers from 23 commercial and development banks in Nepal, who participated in the survey, 91 per cent identified inadequate understanding of the sources of customers' information as the top threat for their organisation, while 96 per cent of the respondents cited technology gap as the biggest challenge to AML compliance," reads the report.

National Banking Institute (NBI) had conducted the survey in collaboration with Fintelekt in December 2016.

The banking industry seemed to be a laggard in adopting technological innovations as about 47 per cent of the banks that participated in the survey maintained the Know Your Customer (KYC) and Customer Due Diligence (CDD) manually.

"The lack of an automated system that will allow front-line and compliance staff to readily and easily access customer information digitally is likely to compromise monitoring and reporting," reads the report.

Other threats haunting Nepalese BFIs are poor understanding of the beneficial ownership of corporate clients, trade-based money laundering and monitoring customers that transact across the lines of business while terrorist financing or organised crimes are considered a low risk area.

The study found that coping with domestic regulations was also a top AML compliance challenge for Nepal, as per 91 per cent of the participants of the survey.

About 87 per cent of the compliance officers thought inadequately trained staff was a big challenge while lack of engagement by the senior management was also considered a challenge by 57 per cent.

It found that the Nepalese banks lacked robust systems and processes to help them establish greater control over AML monitoring and record keeping.

AML risk identification and assessment have got low priority in the BFIs.

Only 47 per cent of the banks participating in the survey have updated high-risk customer profiles in the last six months while 40 per cent have never renewed or have not renewed the risk profiles in the last three years, and 59 per cent of them are not reviewing money laundering risks in every transaction.

Only two banks have an AML compliance team of 21 to 50 professionals, while more than two thirds of them are operating with a team strength of five or even less dedicated staff members for AML.

The lack of support and involvement from the top management team and the Board of Directors pointed to low priority being accorded to AML compliance by banks as 78 per cent of the respondents believed that they needed more support and involvement from the senior executive management.

"Overall AML and combating financing of terrorism (CFT) regime in Nepal is yet to develop,” said managing director of Fintelekt Shirish Pathak. “Besides, maturity levels vary across banks, with some banks ahead of others on the curve in terms of risk identification and assessment, monitoring, technology and training."

The survey is the first of its kind in Nepal and covered the processes related to risk identification and assessment, monitoring and record keeping, politically exposed persons (PEPs), Foreign Account Tax Compliance Act (FACTA), technology and systems, resources, training and other parameters.

The report was launched at the AML conference organised by the NBI in Kathmandu on Friday.

Discourage money without source: governor

Governor of the central bank, Nepal Rastra Bank, Dr. Chiranjibi Nepal urged the bank and financial institutions (BFIs) to discourage money whose source could not be identified.

"Discouraging fraud customers, organisations and transactions is also the responsibility of the banks. The central bank wants your cooperation in the AML efforts," he said addressing the Anti-Money Laundering conference in Kathmandu on Friday.

He said that the AML was not a choice but a requirement for the banks' own profitability and sustainability.

He said that Nepal was committed not to allow any money earned through unidentified sources and have the potential of being used in illegal activities in the country.

The governor asked the BFIs not to make the KYC (Know Your Customer) detail exhaustive, which might scare the customers.

President of Nepal Bankers' Association Anil Keshari Shah said that it was time to invest in developing human capital and in technology on AML.

"AML compliance should be in the DNA of every employee of banks and followed religiously," he said.

NBI chairman Ajay Shrestha said that the bank deposits should be clean in nature. 

(Published in The Rising Nepal)

TT urges govt to allow resorts in the CNP

Temple Tiger Green Jungle Resort has urged the government to review its decision to close the resorts inside the national parks.

Talking to journalists, executive chairman of the Temple Tiger Group Companies, Basant Raj Mishra, said that the decision has had severe repercussions on the branding of the Chitwan National Park (CNP), which was noted as Asia’s Africa, and resorts operating inside the park.

Seven luxury resorts – Temple Tiger Hotel, Tiger Tops Jungle Lodge, Machan Wildlife Camp, Chitwan Jungle Lodge, Gaida Wildlife Camp, Hotel Narayani Safari and Island Jungle Resort – were operating inside the CNP.

They were forced to leave the CNP in July 2012.

The government had blamed the resorts for being in conflict with nature.

“All the resorts in the national park worked in partnership with the park security and communities for conservation. There was critical information and resource sharing, which greatly contributed to the anti-poaching efforts and tracking the rogue predators,” Mishra said.

Jeep ready for safari in the Chitwan National Park. 

He claimed that there was no empirical evidence to show that closure of properties inside the park had actually led to an increase in wildlife.

Nepal is a pioneer in wildlife tourism, and the resorts inside the park offered products like wildlife, soft adventures such as boating, elephant rides, and culture.

They contributed hugely to the state coffers as a resort paid between Rs. 20 million and Rs. 30 million in taxes and local revenue per year.

“The parks used to charge a tourist US$ 300- 400 per night while they were operating inside the park. But it is difficult to sell products even at US$ 150 after operating outside the CNP,” Mishra said.

He said that the government should reconsider the decision as Nepal needed quality tourists to earn more revenue from this industry.

Infrastructure of the seven resorts inside the CNP was left as they were while most of the huts, halls and other structures have been damaged.

But the entrepreneurs said they would be happy if only their licenses were renewed.

“We are not asking for compensation for the loss that we have incurred over the years. We want to see wildlife tourism being developed,” he said.

Wildlife tourism is an important part of the tourism industry in many countries, including many African and South American countries, Australia, India, Canada, Indonesia, Bangladesh, Malaysia, Sri Lanka, Maldives as well as Nepal.

Wildlife tourism encompasses interactions with wildlife, such as observing and photographing animals in their natural habitat.

According to Mishra, it had the recreational aspects of adventure travel, and supports the values of ecotourism and nature conservation programmes.

The resorts operating inside the CNP claimed that the tourists and travelers contributed to the conservation and improvement of the conditions of the animals, and the resorts helped in anti-poaching as well habitat restoration.

Meanwhile, the government has formed a committee to study the possibility of allowing the resorts to operate inside the CNP and recommend the operation modality.

The Ministry of Forest and Soil Conservation had formed the committee, which is led by the director-general of the Department of National Parks.

The ministry claimed that the process would be transparent, and capable companies would be allowed to run their businesses inside the park.

(Published in The Rising Nepal on 27th January)

NRA releases money for second installment

Kathmandu, Jan. 26: The National Reconstruction Authority (NRA) Thursday released about Rs. 12 billion to distribute the second installment of the house reconstruction grant, Rs. 150,000.
Issuing a press statement, the reconstruction body said that it had authorised Rs. 11.75 billion to the Central Programme Implementation Unit of the Ministry of Federal Affairs and Local Development, to distribute the second installment of the grant in severely hit 14 districts.
According to NRA chief executive officer Dr. Govinda Raj Pokharel, a meeting of the Authority the other day had decided to authorize the budget.
The money will be distributed to the households that have completed house construction up to the plinth.

Govt ready to amend customs, tax policies, says Mahara

 Lalitpur, Jan. 25: Finance Minister Krishna Bahadur Mahara said Wednesday that the government was ready to make timely amendment in the customs and tax policies.

"The government is committed to resolving the immediate problems at the earliest while the policy-related issues will be addressed in the upcoming budget," said Mahara while addressing an interaction organised on the occasion of International Customs Day by the Federation of Nepalese Chambers of Commerce and Industry (FNCCI).

He maintained that his priority was to develop an export-oriented economy to take the country on the path of growth.

"The country is facing a huge trade deficit, therefore, we need to focus on products that have export potential, and the government is ready to support the businessmen in this endeavour. If there are any hassles we can resolve through dialogue," said Mahara.

The finance minister said that there shouldn't be a distance between the customs and the business community.

The businessmen were highly critical of the government for being revenue-oriented and turning a deaf ear to their troubles in their import-export business.

Chairman of the Industry Committee of the FNCCI Umesh Lal Shrestha said that the government's major focus was on collecting revenue and meet the target, but it has never listened to and tried to address the problems faced by the exporters and producers.

"Exporters are not getting the incentives which they are entitled to as per the law while our neighbours India and China are providing 16-17 per cent incentives in exports," he said.

Businessman and lawmaker Pawan Sarda urged the government to maintain at least a 5 per cent spread in the customs duty of raw materials and finished goods.

"The government has never listened to the grievances and suggestions of the entrepreneurs. Industrialists are looked upon as terrorists," he said.

FNCCI president Pashupati Murarka urged the finance minister to scrap the reference book maintained at the customs.

"The reference book has been promoting under-invoicing. If you doubt the amount of goods, sell it through online auction but remove that book," he said.

Saying that the government was a partner in their business without making an investment, as they pay 25 per cent of their income, he asked the government to behave well with the entrepreneurs.

Director-general of the Department of Customs Shishir Kumar Dhungana expressed his commitment to address the just demands of the business community.

"About 60 per cent of the international trade has been maintained through the online system, which will reach 97 per cent by the end of next fiscal year. We are upgrading 13 customs offices," he said.

He said that an integrated border office was being built at the Rasuwagadhi border with an investment of Rs. 530 million.

The businessmen also asked the minister to open the Tatopani customs, lessen the duty on raw materials and simplify the export process. 

Increase investment in women empowerment: Nepal

Kathmandu, Jan. 24: Former Prime Minister Madhav Kumar Nepal Tuesday said that the state should increase investment in empowering the women.

Addressing the inauguration ceremony of Women and Children Centre at Changunarayan, Nepal said, "Social development begins with the women and their empowerment. Therefore, programmes should be implemented in order to make them literate, productive, capable and entrepreneur."

He urged the community to utilise the centre for the production of various goods and services and other social activities.

Women make sanitary pads in the centre.

He appreciated the efforts of Institute of Cultural Affairs (ICA) Japan and its Nepal Country Office for their contribution to renovating the building and launching various income generating trainings and activities.

According to Shizuyo Sato, executive director of ICA Japan, the organization provided Rs. 13.5 million for the renovation of the building, conducting training, procuring machines and other activities.

She informed that the ICA Japan was going to launch another support programme in Sindhupalchowk.

"In Sindhupalchowk, we will support the quake-affected communities with training on agriculture, dairy and animal husbandry as well as juice and Nepali hug plum candy products," she said.

The programme is scheduled to begin in June this year.

She said that the programme would be replicated in Nuwakot district as well.

The project entitled the 'Renovation of learning centre for vulnerable victim of the disaster in Changunarayan, Bhaktapur,' has child club and senior citizen's club for utilising centre for their future growth.

"The project has learning centre renovation, community meeting for rehabilitation, psychosocial support activities for women, children and elderly citizen to cope with disasters and income generating activities for women," said  Prof. Dr. Tatwa P. Timsina, chairman of ICA Nepal.

on," he said.

The term of insurance for Nepalese workers in India will be for one year in general. If the term of employment is fixed, the insurance coverage can be obtained for the specified period.

The Prime Minister said that a three months' grace period would be provided in the insurance policy for renewal. It means that if any worker sustains critical injuries or dies within three months of the expiry of the policy, he would get all the benefits of the policy.

The government also said that the families of the workers could also renew the policy.

Chairman of the Insurance Board Chiranjibi Chapagain said that the announcement was important for the safety of Nepalese workers abroad and expressed his commitment to prepare the necessary policy guidelines at the earliest. 

Foreign Employment Insurance to cover 15 critical illnesses

Kathmandu, Jan. 24: Prime Minister Pushpa Kamal Dahal Prachanda Tuesday announced that the foreign employment term insurance would now cover 15 critical illnesses.

Addressing a press conference at Baluwatar, he announced that the foreign insurance term insurance would be expanded to include life insurance, loss from income as well as critical diseases like cancer, kidney failure, major organ transplant, stroke, coma, total blindness, paralysis and mental illness caused due to accident.

"The new insurance scheme would include an additional Rs. 500,000 coverage and the workers in the foreign countries will get up to Rs. 2 million from insurance companies," he said.

The new provisions will come into effect from Saturday, January 28.

The PM said that mental illness would also be included in the critical illness list within three months and directed the Insurance Board, the insurance sector regulator, to formulate the necessary policy for the same.

PM Prachanda also announced that the compensation money to the families of Nepalese workers who receive fatal injuries in accidents or die in foreign countries would be raised to Rs. 700,000 from the current Rs. 400,000.

After the implementation of this provision, if any worker meets a fatal accident or dies in foreign countries, his family will get about Rs. 2.7 million.

The new scheme will be applicable to all Nepalese citizens working abroad, but they need to pay an additional Rs. 500 to get coverage for critical illnesses.

PM Prachanda also announced that he would make the term insurance mandatory for all Nepalese who go to India for employment from February 12 this year.

"As per the new provisions, Nepalese workers in India will have the facility of life insurance covering critical illness, too. The life insurance will cover Rs. 750,000 and health insurance Rs. 500,000. Including Rs. 150,000 compensation from the Foreign Employment Promotion Board, total coverage will be Rs. 1.4 million," he said.

The term of insurance for Nepalese workers in India will be for one year in general. If the term of employment is fixed, the insurance coverage can be obtained for the specified period.

The Prime Minister said that a three months' grace period would be provided in the insurance policy for renewal. It means that if any worker sustains critical injuries or dies within three months of the expiry of the policy, he would get all the benefits of the policy.

The government also said that the families of the workers could also renew the policy.

Chairman of the Insurance Board Chiranjibi Chapagain said that the announcement was important for the safety of Nepalese workers abroad and expressed his commitment to prepare the necessary policy guidelines at the earliest. 

Decentralize the national economy: experts

Kathmandu, Jan. 23: Former finance minister Surendra Pandey Monday called for decentralising the national economy in order to achieve inclusive development and growth.

Addressing a seminar on 'Inclusive economic growth' organised by the Society of Economic Journalists - Nepal (SEJON) here he said, "Most of the economic activities are centred in the Kathmandu Valley and a couple of cities. Except teachers, all other government employees, including army and police personnel, mainly live in the Valley which has long been resisting the distribution of economic activities and budget allocation in other areas."

According to Pandey, it would be better to enhance economic areas before making programmes for inclusiveness.

"We need to enhance productivity for the rapid economic growth. For the equal distribution of the resources, we should have higher economic growth to ensure the availability of required resources," he said.

He urged for the development of entrepreneurship programmes and opportunities for the youth to achieve inclusive development.

 "To achieve higher growth-trajectory, we need to create entrepreneurship-based economy rather than job-based economy. So, the youth should be motivated to take up their own business initiatives, and opportunities should be created for the youth returning from the Gulf countries and elsewhere," said Pandey.

Dr. Swarnim Wagle, member of the National Planning Commission (NPC), said that the country made haste in bringing the inclusion to the front.

"There is more publicity of inclusiveness while we are lagging behind in creating environment for investment and wealth creation. As a result, we are running short of budget to address all inclusive and welfare measures," he said.

According to Dr. Wagle, 2-5 per cent of annual economic growth was not sufficient to pull the nation out of poverty trap.

In the past 26 years, the country had only once achieved the growth rate of 7 per cent. It achieved 7.6 per cent of growth in the fiscal year 1993/94.

He said that Nepal was yet to initiate structural transformation for the rapid economic development.

Country director of Asian Development Bank (ADB) Kenichi Yokoyama pointed towards three critical challenges for the growth – insufficient infrastructure and human capital, and lack of economic structural transformation.

"Nepal should focus on employment growth through entrepreneurship development. We would like to partner with the government in those areas," he said.

He suggested Nepal double investment in infrastructure projects.

"In addition to it, if the country focused on high value products rather than traditional agriculture products, it will play an important role in poverty alleviation and inclusive development," he said.

Joint secretary of the Ministry of Finance Baikuntha Aryal said that it was unfortunate that inequality was rising despite a tremendous improvement in the area of social development.

"Some of the problems are due to centralized allocation of budget and lack of coordination between the development projects. This has resulted in higher cost and time consumption in completing the infrastructure projects," he said.

Economist Bina Pradhan said that the reproduction sectors should be included in the economic sectors.

"Women contribute 52 per cent to the gross domestic product (GDP) but it is not calculated as the economic development," she said.

Former finance secretary Rameshwor Khanal said that infrastructure development and adoption of high-end technology were key to enhancing productivity.

SEJON president Gokarna Awasthi said that the country had the challenge to keep the foreign job seeking youth inside the country by creating entrepreneurship opportunity here. 

Muktinath Bikas Bank gets ASBA approval

Kathmandu, Jan. 23: Muktinath Bikas Bank Limited has been granted the approval for the Application Supported by Blocked Account (ASBA) system.

The bank issued a press statement to inform that the Securities Board of Nepal (SEBON) has provided the ASBA license to it.

Chief executive officer of the bank Bharat Raj Dhakal said that the bank would provide the ASBA service from its 47 branch offices.

"Most of the branches of the bank are in rural and remote areas and, therefore, the people in the far-flung areas will be benefited from the ASBA services provided by the bank," he said.

He said that the bank would provide the service from its three limited banking offices very soon.

Meanwhile, the bank is planning to move its corporate office from Pokhara to Kathmandu.

ASBA refers to an application mechanism for subscribing to initial public offers (IPO).

The system, which ensures that the applicants' money remain in his/her bank account till the shares are allotted, was introduced by the Securities Board of India (SEBI) for retail investors in 2008.

The system was developed by the SEBI.

The ASBA system will block the money in the share applicant's bank account until the shares are allotted.

If any share is not allotted to the applicants, the bank will unblock the money upon the instruction of the issue manager.

If the applicant is allotted the shares, the required money will be debited from his bank account.

Himalaya adds second Airbus

Kathmandu, Jan. 17: Himalaya Airlines is all set to add a second aircraft, Airbus 320-214, to its fleet by the end of January.

According to the company, the Airbus has been brought on long-term dry lease. This means the aircraft financing entity will provide the aircraft without the crew.

 “With the addition of the new aircraft to its fleet, Himalaya has also announced scheduled flights to two new destinations – Kuala Lumpur of Malaysia and Yangon of Myanmar.

The airline will fly to and from Kuala Lumpur five days a week whereas there are two flights to Yangon every week - Monday and Friday.

It will commence its flights to Kuala Lumpur and Yangon from February 10 and 24 respectively.

The new Airbus 320-214, with Nepal registration 9N-ALV, has 158 seats, including 8 business class and 150 economy class seats.

Himalaya has added its second aircraft to its fleet in the second year of its operation and has announced it will add two more planes by December 2017.

“To ensure a comfortable journey to the passengers, the Airbus is equipped with its refreshed comfortable seats, in-flight entertainment with latest videos and audios,” reads a press statement issued by the company.

The airline has appointed Carnival Travel SDN. BHD. and My Golden Lion Aviation Pvt. Ltd. as its General Sales Agents (GSAs) for Malaysia and Myanmar respectively.

The launching round trip airfare for Kathmandu – Kuala Lumpur – Kathmandu flight starts from Rs. 25,375 and Kuala Lumpur – Kathmandu – Kuala Lumpur starts from MYR 928.

Similarly, the round trip airfare for Kathmandu – Yangon – Kathmandu starts from Rs. 29,600 and Yangon – Kathmandu – Yangon starts from 320 USD. Both the charges are tax exclusive.

“We are pleased to further expand our network by launching two new destinations which will help to meet the rising demad for not just leisure and religious travel but also visiting friends and relatives between Nepal and Kuala Lumpur and Yangon,” vice president of the Company Vijay Shrestha said. 

Gyawali files writ against the govt

Kathmandu, Jan. 16:

Former chief executive officer (CEO) of the National Reconstruction Authority (NRA) Sushil Gyawali Monday filed a lawsuit at the Supreme Court, claiming his removal from the post was illegal and ill-intended.

In the case registered at the court, he has demanded reinstatement to the post.

Gyawali has demanded that the court nullify the Cabinet’s decision to sack him from the post and appoint Dr. Govinda Raj Pokharel as the chief of the NRA through a certiorari.

The government, Office of the Prime Minister and Council of Ministers (OPMCM), the Cabinet, Prime Minister and Dr. Pokharel are the defendants in the writ.

“I was appointed as per Article 11(3) of the NRA Act 2015, which maintains that the CEO is appointed for a 5-year term,” Gyawali said in his 14-page-long writ-application. “I had been fulfilling the duties set by the law.”

He has claimed the reconstruction works were moving satisfactorily, and the government and the donor agencies had appreciated the progress made by the NRA.

He said that the government removed him from the post without studying his twice-furnished clarifications.

“The government made a case that I was unable to forge coordination among the government agencies for the reconstruction, which is not the case, as I was continuously communicating with the concerned ministries and other stakeholders,” reads the writ.

Gyawali has mentioned that his removal was not related to his work efficiency but an implementation of the pre-agreement and plan of the defendants.

The writ reads that the NRA, under the leadership of Gyawali, identified 626,036 quake-affected families who were eligible for the house reconstruction grant, signed grant agreements with 544,996 households and deposited the first installment of the grant money - Rs. 50,000 - in the bank accounts of 459,886 families.

“After the government decided to raise the grant money to Rs. 300,000 in September last year, the NRA had submitted its action plan to the Cabinet to increase the second and third installments amount to Rs. 150,000 and Rs. 100,000 from the earlier Rs. 80,000 and Rs. 70,000 respectively. But the Cabinet had approved the action plan on the very day it decided to seek a clarification from me about the delay in distributing the house reconstruction grant to the quake-victims,” reads the writ.

Likewise, Gyawali said that the NRA Steering Committee meeting in the last week of October had directed the Ministry of General Administration to provide the required human resources within 15 days. But the ministry has not supplied the manpower required by the NRA so far.

A Cabinet meeting on January 11 had given Gyawali marching orders, accusing him of inefficiency in expediting the reconstruction works as per the government’s expectations, and had appointed Dr. Pokharel as the chief of the reconstruction body.

Stunned at being fired from the NRA, Gyawali said, "The unjust decision of the Cabinet has forced me to seek legal remedies. It is necessary to ensure justice to the quake-affected people by expediting the reconstruction works."

The erstwhile Sushil Koirala-led government had appointed Pokharel, then the incumbent vice-chairmen of the National Planning Commission, as the CEO of the NRA about one-and- a-half years ago.

But he had to leave office as the government failed to get the approval of the parliament on the Reconstruction Ordinance.

The government had twice sought clarification from Gyawali, blaming him for his inability to mobilise the required staff for the post-quake reconstruction, implement the instructions of the NRA Steering Committee, poor coordination with the government agencies and delay in the distribution of the house reconstruction grant.

He had submitted his clarifications to the government on January 4 and 8.

Enterprise registration in 3 days

Registration certification to be delivered electronically! 

Kathmandu, Jan. 15: The Department of Industry (DoInd) has started its online services for Foreign Direct Investment (FDI) approval, visa recommendation for foreign investors and enterprise registration.

According to the department, certificate of enterprise registration would be sent to the investors electronically, and they need not visit its offices.

Minister for Industry Nabindra Raj Joshi Sunday inaugurated the online services at a programme organised at the ministry.

With the commencement of cyber services for FDI approval, visa application and business registration, more foreign investors will be attracted to Nepal as it would reduce the time dramatically, said director general of the department Pradip Kumar Koirala.

Talking to The Rising Nepal, he said, “Foreign investors used to spend about 5 to 6 months in obtaining a tourist visa. But now they can get it within a couple of weeks.”

So far, any foreigner interested to invest in Nepal had to apply for a ‘tourist visa’.

Their application would go to the DoInd and take months in getting approval.

After obtaining approval from the department, the investors would get the visa which would be converted to a ‘business visa’ following the registration of their enterprise in Nepal.

“Such a lengthy process had discouraged the investors,” said Koirala.

The new system will facilitate in registering a business in three days and FDI approval in seven days if an investor submits the required documents via online.

The investor will be notified of his business registration through e-mail, and they will be informed even if the registration process fails due to a shortage of necessary documents.

“The applicants need pay the registration charges only after their application for running a business is approved. They need not to come to the department, they can send the scanned copy of the revenue payment and we will send the scanned copy of the certificate to them via e-mail,” Koirala said.

Minister Joshi said that the ministry aimed at transforming all departments and agencies under it by going online in order to make their services fast, efficient and transparent.

“We have been receiving complaints regarding services provided by the DoInd, Office of the Company Registrar, Nepal Bureau of Standards and Metrology. Services of these government agencies will be made online to make them more transparent and curb corruption,” he said.

He said that CCTV (Close Circuit Television) would be installed at the DoInd in the second phase.

However, it will take about four months for the department to be completely paperless, as it also requires submitting hard copy of the documents till then.

Published in The Rising Nepal Daily. www.therisingnepal.org.np 

Special health programme for quake-affected people

Kathmandu, Jan. 15: The government is set to operate ‘Special Health Programme’ in the districts affected by the devastating earthquake of April and May 2015.

Joint-spokesperson of the National Reconstruction Authority (NRA) Dr. Bhishma Kumar Bhusal said that the Ministry of Health (MoH) would run special health programme in coordination with the reconstruction body.

Health services will be provided free under the programme.

A meeting between NRA chief executive officer Prof. Dr. Govinda Raj Pokharel and secretary of the MoH Dr. Senendra Raj Upreti on Sunday decided to run special health camps in the quake-hit areas in collaboration with the Institute of Medicine-Tribhuvan University, Kathmandu University and Patan Academy of Health Sciences.

Dr. Pokharel said that free health services would be provided to the people of quake-hit districts through mobile health services.

Meanwhile, the MoH has decided to send a circular to the District Public Health Office and District Health Office to provide their services to the quake-affected people for free by mobilizing their resources.  

Dr. Mahat urges NRN for Investment

Kathmandu, Jan. 15: Minister for Foreign Affairs Dr. Prakash Sharan Mahat has urged the Non-Resident Nepalese (NRN) members and Nepali diaspora in the United States of America to help in moving forward the agenda of economic diplomacy, the Embassy of Nepal in Washington DC said in a press statement the other day.

Addressing a programme on ‘Economic diplomacy and Nepali integration’ in connection with the NRN-USA 5^th Annual General Meeting in Dallas, Texas of the US, he said, “I request you to help the country in moving forward the agenda of economic diplomacy as a pioneer and to utilize the recently provided duty-free access for 66 Nepalese products in the US market.”

The USA has been providing duty free access for 66 Nepalese products in its markets.

Dr. Mahat took opportunity to appeal NRN members to participate and to encourage other investors to participate in the ‘Nepal Investment Summit 2017’ which is to be held in Kathmandu on 2^nd and 3^rd March this year.

Nepalese ambassador to the USA Dr. Arjun Karki, said that although the Embassy had limited resources, it had given importance to the areas of economic diplomacy.

He expressed commitment to work together with the NRN in the days to come and requested all to utilize the trade preference facility and participate in the investment summit.

Economic counselor of the Embassy Kailash Raj Pokharel presented a paper on ‘Trade and investment opportunities in Nepal’.

CFLG in 50 % local bodies by 2020

The government has said that the child-friendly local governance (CFLG) would be implemented in 50 per cent local bodies by 2020.

According to a plan formulated by the Ministry of Federal Affairs and Local Development (MoFALD), the government aims at announcing at least 15 per cent of the local bodies as ‘child-friendly’ in coming four years.

“As per the CFLG expansion plan, the ministry has been planning to give priority to the child-friendly local bodies, including school and health facilities,” said joint-secretary of the MoFALD Reshmi Raj Pandey.

The government had introduced the concept of CFLG about a decade ago to encourage the local bodies to institutionalise child protection, child development and child participation in local level policy making, structure, system and behaviour.

Five local bodies – Siddeshwor VDC of Baitadi, Bhingri VDC of Pyuthan, Tettariya VDC and Biratnagar sub-metropolitan city of Morang and Sunawal municipality of Nawalparasi – have been declared child-friendly so far.

Pragatinagar VDC of Nawalparasi was the first local body to be declared as child-friendly but it has been merged with Devchuli municipality later.

Pipra Paschim VDC of Saptari is on the final stage of CFLG declaration.

It has written a letter to the MoFALD asking to declare the village as the child friendly since it had met most of the indices of the CFLG.

Secretary of the VDC Tek Bahadur Khadka said that the village would be declared as the ‘child-friendly’ within a couple of months.

Pandey informed that the CFLG has been implemented in 58 municipalities and 1,070 VDCs of 75 districts across the country.

CFLG is being implemented through the Local Governance and Community Development Programme (LGCDP) across the country.

According to the statistics of MoFALD, there are 22,457 Child Clubs and Child Club Networks in Nepal, and 431,960 children are associated in those clubs and networks.

“About 230,659 boys and 201,031 girls are united in the clubs and networks. Approximately 63,000 children participate in Ward Citizen Forum and 3,591 in Integrated Plan Formulation Committee,” said Pandey.

With the implementation of the CFLG, children have begun to represent in School Management Committee and Health Management Committee at the local level.

CFLG is dedicated for the policy making, budget allocation and investment for the children, listening to their demands and inclusion in various decision making platform at the local level and ensure child protection and promotion.

Local bodies should allocate 10 per cent of their development budget for children and those that are implementing CFLG should pledge 15 per cent budget for the same.

The government has included the CFLG in the 14^th periodic national plan.

It has authorised Rs. 105 million for CFLG implementation in the current fiscal year which is higher by Rs. 35 million than the previous fiscal.

The budget will be used in CFLG orientation training, child meeting, CFLG resource centre management, child labour minimization programme, capacity building of Child Club Network and monitoring and evaluation.