An Apology for cannabis

Healing the Himalayas: Proposal of Strategy, Technology and Finance for Post-earthquake Recovery, Reconstruction and Renaissance in Nepal by Dipak R. Pant. Publisher: Interdisciplinary Unit for Sustainable Economy, Universita Carlo Cattaneo, Italy. 2016. Pages 104. Price Rs. 600÷USD 6.

Disasters, natural or human-induced, not only incur huge human or material loss but also provide an opportunity for the reconstruction and reengineering of the society, infrastructure, policy and economy.

However, it seems that the same is not happening in Nepal's case. Apart from government and reconstruction agencies' parroting of 'build back better', there has been no practical implementation of better policies, economic reforms and social engineering.

In such a scenario, a Nepali anthropologist and economist at the LIUC, Italy Prof. Dr. Dipak R. Pant, in collaboration with 23 experts of economics, architecture, social economy, sociology, geology, journalism and other sectors, has come up with a book – 'Healing the Himalayas: Proposal of Strategy, Technology and Finance for Post-earthquake Recovery, Reconstruction and Renaissance in Nepal'.

Unlike many other books by economists and sociologists, this book makes an in-depth analysis of the situation and offers pragmatic solutions to various social and economic maladies.

Although the book's primary focus is post-quake reconstruction, it deals with several topics ranging from land safety, livelihood structures, sustainable energy, wireless connectivity, sustainable waste management, foreign assistance and self-reliance to public finance strategy and re-positioning Nepal in global public opinion and international market.

The book advocates for reducing human vulnerability, motivating government workers, and retaining the existing workforce, recalling the migrants, developing and consolidating local human capital as the fundamental pre-requisites for the economic progress of the country.

Interestingly, the writer suggests for legalizing cannabis or hemp calling it a great source for substantial and steady stream of revenues.

Cannabis grows in almost every livable and cultivable area in Nepal – from less than 300 metres to 3000 metres above sealevel – and it serves many purposes such as industrial (construction, paper, fiber, textile), medical and pharmaceutical, cosmetic (cream, oil) and recreational (used as smoke, vapour, herbal drink or sweet).

According to the book, cannabis seed can be used to make medicine, personal care products, animal feed, flour, food ingredient, beer, cooking oil, paint and fuel. Its stalk can be used to make hats, clothes, bags, biomass, insulator, paper, ropes and bricks while plant is used for greenery of the landscape, soil conservation and purification and carbon sink. Similarly, leaf is useful in making smoke, herbal tea, medicine, food ingredient and compost fertilizer.

Dr. Pant blames the Nepali rulers for outlawing cannabis due to the pressure from the western countries. In 1960s and 70s, Nepal was a perfect 'another world' -  polytheist, colourful, exotic, relaxed, cool, beautiful, poor but cheerful and dignified people sans antagonism or sense of inferiority vis-à-vis the Westerners. The cannabis, that was freely and easily available, was one of the major attractions.

The book presents the impact of cannabis in the economy, production module, job creation, tax and saving police cost. Pant says that after legalizing cannabis, crime decreased by about 3 per cent in Colorado, a state in the USA, and concludes that its legalization did not seem to have impacted negatively in the law and order situation.

The book has dozens of practical suggestions to reposition Nepal in global public opinion and world market, cut tax and implement sustainable public finance strategy, apply sustainable energy and waste management measures, and create wireless connectivity.

"Thinking beyond post-disaster recovery, our small interdisciplinary team has tried to offer some ideas concerning long-term solutions for the Nepalese people, particularly those in the rural highlands, who are constrained by structural (in-built) marginality, and have suffered not only the 2015 earthquake, but also a number of other socio-economic problems. 

One of the most serious problems, in the past decades, has been the massive erosion of human capital due to an inexorable outbound migration of young and adult workforce pushed away by poverty at home," reads the prologue to the book.

The book comes with high quality pictures, maps, graphics and illustrations which have increased its readability. The book may specially be useful for policy makers, economists and students. 

(Published in The Rising Nepal, Friday Supplement on 30 June 2017)

Vote counting underway in 307 local units

Kathmandu, June 29: Vote counting is underway in 307 of the 334 local units in province 1, 5 and 7 where the second phase of local elections was held on Wednesday.

The Election Commission of Nepal (ECN) said that as per the details received by the Joint Election Operation Centre (JEOC) at the ECN, by Thursday evening vote counting had begun in 307 local units while counting was yet to commence in 25 units.

"Ballot boxes from the polling centres in high mountain and hill areas were collected with helicopters, and ballot boxes from a polling centre in Taplejung district is yet to be collected," said the election management body in a press statement.

Likewise, it stated that the elections would be held in ward no. 1 of Kothimahi rural municipality of Rupandehi and ward no. 3 of Jaya Prithvi Municipality of Bajhang district on Friday. The election was halted in those two polling centres following disputes among the political parties.

Meanwhile, the ECN has corrected the percentage of vote cast to 73.69 per cent from earlier 70.5 per cent.

"Province 1 witnessed 72.49 per cent vote casting, and 75.34 per cent people voted in province 5 and 73.69 per cent in province 7," read the statement.

The percentage of voter turnout is higher than the first phase of local polls which was held in province 3, 4 and 6 a month-and-a-half ago where 73 per cent votes were cast.

Elections were held in 1 metropolitan city, 7 sub-metropolitan cities, 111 municipalities and 215 rural municipalities.

As much as 62,408 candidates were in the fray in those local units for 15,038 posts – 119 mayors and deputy mayors each, 215 chairmen and deputy chairmen, 2,874 ward chairmen, woman members and dalit women members each, and 5,748 ward member (open).

“The highest voters turn out was seen in Bajura district where 80 per cent people cast their ballots while Bhojpur witnessed only 61 per cent of the total voters exercising their franchise rights which is the lowest in the 35 districts where the elections were held in the second phase,” said Dr. Ayodhi Prasad Yadav, Chief Election Commissioner, at a special press meet organised at the ECN on Wednesday.

150,000 houses to be completed by July 15, says NRA

Kathmandu, June 29: The National Reconstruction Authority (NRA) has said that by the end of the current fiscal year 2016/17, about 150,000 private houses would be built in the districts hit by the devastating Gorkha Earthquake 2015.

"So far, 30,000 houses construction was completed with full compliance with the quake-resistance building practices. As the reconstruction of the private houses has caught the desirable speed, we hope that additional 120,000 houses would be constructed by the end of this fiscal year," said Dr. Govinda Raj Pokharel, chief executive officer of the NRA.

He made the comments at a discussion on 'Nepal post disaster reconstruction experience: current status and lessons learnt' organised by South Asia Watch on Trade, Economics and Environment (Sawtee) in association with the Asia Foundation.

Saying that grievance handling was one of the biggest challenge in the reconstruction process, Dr. Pokharel informed that the reconstruction body was planning to mobilize additional 293 engineers in the field to address the complaints registered by the people to the government.

"Similarly, more than 45,000 families have complained that though their house was completely damaged in the tremors, surveyors did not observe it," he said.

According to him, as the engineers and technical manpower will be managed by the local bodies, the reconstruction process would move efficiently.

He cited the shortage of skilled manpower, insufficient government grant, and perception that the house would be built by the government as the major reasons behind the delay in the reconstruction process.

Former member of the NRA Steering Committee Kishore Thapa said that the reconstruction of private houses was slow because people wanted to build larger and better house than that they previously owned.

"There is the situation in the village that if you don't have concrete house with pillars you lose reputation," he said.

He noted that the country should have adopted indigenous models tested successfully such as project model applied during the reconstruction post- 1988 quake, ministry model adopted in conflict management or development committee model as implemented in Chure conservation rather than importing the Gujrat or Pakistan's authority model.

Presenting a paper on the post-quake reconstruction, former vice-chairman of the National Planning Commission Dr. Jagadish Chandra Pokharel said that the authority for the post-quake reconstruction should be decentralized in order to expedite the process.

"Now with the local authorities gaining a footing in the local governance, issues related to aid distribution, reconstruction and governance is expected to take place with greater accountability," he said.

Local bodies to develop DRR policies

Kathmandu, June 29: Significantly reducing its role in the Disaster Risk Reduction (DRR), the government is preparing to provide rights to the local government to develop their own policies on DRR, said Shankar Hari Acharya, chief of National Emergency Operation Centre at the Ministry of Home Affairs (MoHA).

 “This will help formulate customized policies suitable for the local context,” he said while speaking at a talk programme on ‘Disaster risk reduction in new local government structure of Nepal: opportunities and challenges’.

He said the need and urgency of DRR mainstreaming was realized profoundly from the policy level following the devastating Gorkha Earthquake 2015.

“Now, this has been reflected in the new disaster management laws and policies,” said Purushottam Subedi, chief of Fire Control and Disaster Management Section at the Ministry of Federal Affairs and Local Development (MoFALD).

He expressed his confidence that the new act would guide Nepalese system to focus on preparedness and planning with well equipped for rapid response.

Suman Meher Shrestha of Town Development Fund highlighted that the reconstruction works should respect the traditional urban fabrics while the complexity of urban DRR should be realised by stakeholders to take any action.

Similarly, senior researcher and ISET Nepal executive Director Ajay Dixit made a reference to draft National Strategy on Urban Resilient Communities while pointed up the possible impact of climate change and climate induced hazards during urban development.

He shared that since Nepal was rapidly urbanizing, integrating DRR during urban development would be the most logical step to develop resilient urban communities.

The programme was organised by National Disaster Risk Reduction Center Nepal (NDRC) in collaboration with Adventist Development and Relief Agency (ADRA) Nepal.

Voter turnout 70 % in 2nd phase of local polls

Kathmandu, June 28:

With more than 70.5 per cent voters turn out, the second phase of local level elections held in provinces 1, 5, and 7 was a huge success, said the Election Commission of Nepal (ECN).

According to the preliminary estimates of the Election Commission of Nepal 70.5 per cent voters cast their votes in 8,364 polling stations in 334 local bodies of the three provinces.

Elections were held in 1 metropolitan city, 7 sub-metropolitan cities, 111 municipalities and 215 rural municipalities.

Voter turnout might go up, said the election management body.

Likewise, 62,408 candidates were in the fray in those local units for 15,038 posts – 119 mayors and deputy mayors each, 215 chairmen and deputy chairmen, 2,874 ward chairmen, woman members and dalit women members each, and 5,748 ward member (open).

“The highest voters turn out was seen in Bajura district where 80 per cent people cast their ballots while Bhojpur witnessed only 61 per cent of the total voters exercising their franchise rights which is the lowest in the 35 districts where the elections were held in the second phase,” said Dr. Ayodhi Prasad Yadav, Chief Election Commissioner, at a special press meet organised at the ECN.

The first phase of local level polls in provinces 3, 4 and 6 a month-and-a-half ago saw 73 per cent vote casting.

CEC Dr. Yadav said that people braved the rain, in some places all along the day, to exercise their franchise while polling began late due to heavy rain in some locations.

“The Election Commission received utmost support from political parties, candidates, local civil society and other stakeholders in successfully implementing elections by managing tarpaulin sheets and other materials needed for the safety of ballot box and voters in the rain,” said Dr. Yadav.

Election was halted in polling centres ‘A’ and ‘B’ at Pandu Secondary School Polling Station in Jaya Prithvi Municipality of Bajhang district. As disputes erupted after a senior citizen sought help from a youth to cast his vote, voting was stopped there, said ECN.

Likewise, no votes were cast in ward number 6 of Necha rural municipality in Solukhumbu district, and only two votes were cast in a polling station in Sarawal of Nawalparasi district.

According to the EC, the ballot boxes were being carried to the Office of the Chief Election Officer, and the vote counting might start from tonight following a meeting of election officers and political parties.

The Chief Election Officer (CEO) and election officers set date and time for vote counting after the consultation with the political parties.

Meanwhile, Dr. Yadav said that the EC had directed the Chief District Officers to manage additional human resource, vote counting desk, physical facilities, security provisions and observers so as to conclude the vote counting as early as possible.

In the first phase of the local polls, it took about two weeks to conclude vote counting in some of the local units.

The EC has urged all the political parties and candidates to respect the peoples votes and stay calm during the vote counting process.

There are 6.4 million voters in the three provinces where the second phase elections were held – 2.67 million in province 1, and 2.45 million in province 5 and 1.3 million in province 7.

The country has 14.05 million voters. Election to choose the representatives in the Province 2 is slated for September 18.

Concrete house destroy beauty of Nuwakot Durbar

Haphazard construction of private houses ruining the beauty of historic Nuwakot Durbar, constructed by late king Prithvi Narayan Shah, in Trishuli Municipality, Nuwakot. 

BoK to support NRB in developing macroeconomic model

Kathmandu, June 27: The Nepal Rastra Bank (NRB) and Bank of Korea (BoK) Tuesday signed an agreement to develop macroeconomic model for economic forecasting.

As per the agreement, the BoK, in collaboration with the Yonsei University of Korea and the central bank of Nepal, will develop new macroeconomic forecasting model so that the institutions like the NRB, National Planning Commission (NPC) and Ministry of Finance could analyze the economic situation and predict the future outcomes more accurately, said Nara Bahadur Thapa, executive director at the NRB.

According to him, the practice of model building, forecasting and policy simulation in Nepal are at rudimentary stage although the NRB is constantly upgrading the macro models by capturing new information available in the economy.

The Korean central bank is extending its support under NRB-BoK collaboration on Knowledge Partnership Programme.

To develop the model, a Korean team will make a couple of trips to Nepal, and hold discussions with the concerned stakeholders.

“By February 2018, the model development work will be completed,” said Thapa.

He also said that the Korean central bank had been supporting Nepal in payment and settlement, and has pledged to support in monitoring and regulation and economic research framework.

“The Areas of cooperation between the two banks would include capacity strengthening on model building and forecasting, currency management, payment and settlement, and banking sector regulation and supervision,” said Thapa.

He expressed hope that the collaboration with the BoK would be highly useful to the NRB for enhancing efficiency of the staff involved in model building and forecasting.

SAARC is not a failure: Teerink

Kathmandu, June 27: Rensje Teerink, ambassador of the European Union Delegation to Nepal, Tuesday said that the South Asian Association for Regional Cooperation (SAARC) was not a failure.

Speaking at a talk on Economic Development in Landlocked Countries – part 2, a series of Linkfest Thoughts to Action, she said that the regional cooperation might face confusion and difficult situation at times, and recommended to enhance the cooperation through the people to people connectivity and organizations like Sabah, a regional association for home-based workers in South Asia.

She said that the SAARC had taken up and brought down by political problems.

“Small initiatives will be effective in this regard. You shouldn’t be disappointed with small breakdowns. It took 60 years for us to materialise the European Union,” she said.

Teerink said that the EU could be model for the regional integration and suggested to move forward with other regional initiatives like the BBIN (Bangladesh-Bhutan-India-Nepal), BIMSTEC (Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation) and Belt and Road Initiative.

She recommended Nepal to give priority to hydroelectricity, agriculture and infrastructure development.

Executive director of Cuts International, India Bipul Chaterjee also said that energy was definitely an area of cooperation and suggested to take health and education along with the energy development and connectivity.

He said that the BBIN was like the Greater Mekong regional approach, and both the initiatives were led by the Asian Development Bank.

Managing Director of the Nepal Electricity Authority (NEA) Kulman Ghishing urged to give priority to transport and electricity in the regional setup.

Francois Driard, chief executive officer (CEO) of Himalayan French Cheese, said that agriculture and agro-processing industries had high potential in Nepal.

“Perception of Nepal in far east is very good even as compared to India. If the process is simplified, Nepal can tap market opportunities there,” he said.

CEO of Nepal Airlines Sugat Ratna Kansakar said that for the tourism development, the national flag carrier should be strengthened and number of aircrafts and destinations should be increased.

DarazKaymu announces Mobile Week

Kathmandu, June 27: DarazKaymu has announced ‘Mobile Week 2017’ at its online shopping platform from July 3 to 7.

DarazKaymu is one of the leading online shopping platforms in South Asia with businesses in Pakistan, Bangladesh, Srilanka, Myanmar and Nepal.

“We have announced the mobile week so that our customers can get the best rates on mobiles phones and accessories. Its online mobile and accessories sale event that includes various mobile brands as well as smart watches, headphones, earphones etc.,” said Rajeev Amatya, managing director of the company.

According to the company, DarazKaymu is an online platform that connects buyers and sellers in a safe and convenient way.

Deprived sector lending reaches Rs. 100 bn

Kathmandu, June 25:

Executive director of the Nepal Rastra Bank (NRB) Nara Bahadur Thapa Sunday said that the deprived sector lending has reached about Rs. 100 billion.

“The policy intervention by the central bank has created such a positive development that the deprived sector lending has increased tremendously and simultaneously contributed to the development of micro and cottage industries in the rural areas, as well as supported in women empowerment,” he said.

He was speaking at a discussion programme on upcoming monetary policy for the next fiscal year 2017/18. The programme was organised by the Confederation of Nepalese Industries (CNI).

The commercial banks, development banks and finance companies mandatorily invest 5 per cent, 4.5 per cent and 4 per cent of their lending respectively to the deprived sector.

Thapa indicated towards the revision of current 5 per cent spread rate.

He said that the NRB was not happy with the 5 per cent spread rate which he said was comparatively higher than other countries.

“If the banks exercise that high spread rate in the landlocked country like Nepal, it would have negative impact on the business and investment. It will not contribute to private sector development,” he said.

Similarly, he said that the central bank was planning to implement new policies in terms of financial technology (fintech).

“The NRB has established Payment and Settlement Department at its central office last year. Fintech is our priority,” he said.

He said that the central bank was promoting private sector development through monetary policy, structural reforms and financial technology.

President of the CNI Hari Bhakta Sharma said that the country needed a critical departure in policy.

“We are having traditional monetary policies in many years gone by. The private sector is waiting for some innovative approaches and policies for the monetary sector,” he said.

He urged the NRB to implement the national payment gateway to facilitate real time payment.

“The new monetary policy should try to contain the interest rate of industrial lending. The businessmen are paying more than 12 per cent interest of the loan which they obtained at the rate of 7 per cent a year ago. If not controlled in time, it will have negative impact on export, inflation, and export,” he said.

He urged the NRB for policy provisioning to increasing lending to the productive sectors that could contribute to the economic growth.

Anal Raj Bhattarai, member of CNI National Council, had presented the suggestions for the new monetary policy.

He suggested developing cash less economy, reducing spread rate, open capital account convertibility and redefining the productive sectors.

The businessmen had urged for the provision of not closing the banks and financial institutions for more than two days in a row and conduct cheque clearing on Fridays too.

Tourism to launches EMV Chip based cards

Kathmandu, June 25: Tourism Development Bank Limited Sunday launched multiple new services including, EMV chip based Visa card, US dollar card and International Travel Card, TDBL Bank Smart and point of sales (POS).

“The new EMV cards are safer and can be used in more than 100,000 ATMs in Nepal and India. By using the International Travel Card, customer can withdraw the local currency in any country that they visit,” said Mahesh Sharma Dhakal, chief executive officer of the bank.

EMV stands for Europay, MasterCard and Visa which is a global standard for credit cards that uses computer chips to authenticate and secure chip-card transactions.

Likewise, through TDBL Bank Smart is an IT based banking service that enables the customers in obtaining information about and using the bank facilities, inter-bank payment and shopping payment through GPRS or Wi-Fi services.

Similarly, the new POS machines are EMV chip-based.

Dhakal said that the bank was introducing online ASBA (Application Supported by Blocked Account) services, establish eight new branches and five extension counters, and run branchless banking in near future. 

Insurance Board to introduce third party administrator

Kathmandu, June 24: The Insurance Board (IB) is making preparations to introduce third party administrators in the health insurance sector.

According to the Board, the third party will develop software required for the cashless health insurance administration, and run the insurance business in collaboration with the insurance companies and hospitals across the country.

“This will revolutionize the health insurance in the country as the third party will manage the overall insurance system through information technology management that would integrate the insurers, hospitals and the company. Insured people will receive swift and quality service once the new system is implemented,” said IB chairman Chiranjibi Chapagain.

He said that the insurance sector regulator was mulling to implement card system where every insured individual would be assigned a card to avail the health facilities at the listed hospitals or health institutions.

The third party will implement all types of health insurance. 

The IB might also take charge of the micro health insurance, which is being implemented by the government, following the implementation of the new system.

The government has implemented the micro health insurance in 25 districts, and planning to expand it to many other districts in the next fiscal year 2017/18.

However, the board maintained that it wouldn’t ask the government for handing over the management of the micro health insurance until the infrastructure was built.

“The IB has already prepared directives required for the implementation of the third party administrator. It may take a year to manage the necessary infrastructure and administrative management,” said Chapagain.

But, the IB has to wait till the Insurance Act is approved by the parliament because the prevailing Insurance Act, 1993 does not have the provision to issue license of the third party administrator.

As per this, the insurance sector regulator can issue licenses to insurance companies, brokers and surveyors.

The draft of the new Act is prepared and the Ministry of Finance has sent it to the Ministry of Law for the review.

The IB said that the new system would help in transferring technology.

“There is no such company in Nepal that can work as the third party manager by implementing their own technology. Therefore, the foreign companies will bring in new technology which, as the Board believes, may improve the way of doing insurance business,” said Chapagain.

He said that there wouldn’t be the monopoly of third party administrator as the licenses would be issued to multiple companies.

Int'l Women in Engineering Day celebrated in Nepal

Lalitpur, June 23: On the occasion of the International Women in Engineering Day, the Rural Access Programme (RAP3) – a joint project of the government and the United Kingdom’s Department for International Development (DFID) – organised a photo exhibition of women engineers in Nepal.

Organised at the Nepal Engineers’ Association (NEA) office at Pulchowk, the exhibition included photos and sayings of the Nepali women engineers from various fields such as computer, architect, civil and electronic.

One of the major attraction of the exhibition was the photo of the first women engineer of Nepal, Shanti Malla.

“We have tried to present their opinion on engineering field. This is the first time we are celebrating this Day in Nepal,” said Ayasta Pokharel, a graduate engineer at RAP3.

The exhibition showcased 40 photos of female engineers, their work and portraits. British ambassador to Nepal Richard Morris inaugurated the exhibition amidst a programme.

The International Women in Engineering Day takes place on 23 June annually.

This day is organised to cherish the achievements of women engineers and to draw attention of society on the careers in engineers and technical roles for women.

NEA and UK’s Institution of Civil Engineers (ICE) supported the programme.

AAC bricks launched

Kathmandu, June 23:

Chitwan based Aerobricks Company Friday launched Autoclaved Aerated Concrete (AAC) bricks in the market.

The brick is made of concrete, lime and iron dust and can be produced in a customized size through the automated machine.

“We have imported the German technology to produce the brick in Nepal. Although its known as ACC Blocks, it’s a brick and can be used as an alternative to the common bricks generally used in the nation,” said Babu Raja Rawal, executive director of the company.

The ACC bricks are about eight or nine times larger than the common bricks and therefore the construction work moves faster and needs less cement and sand, claimed the company.

The company was established with an investment of Rs. 500 million and employs more than 12 people since the plant is fully automated.

The plant has a capacity to produce 400 to 500 cubic metres of bricks per day.

“About 95 per cent of raw material used in the ACC brick is locally available materials,” said Rawal.

According to the company, the products are available in major cities across the country.

Govt. fails to activate Economic Rehabilitation Fund

Zero progress in supporting quake-affected industries

Kathmandu, June 22: The devastating Gorkha Earthquake of 2015 inflicted huge damage not only to the country’s physical infrastructure but also to its commerce and industry sector.

But there has been almost zero progress in supporting the industries and companies, and rehabilitating them even after more than two years and two months of the quake, although every budget since has included plans and programmes to help in their rescue and recovery.

The process to support the businessmen has been so slow that the government has even failed to activate the Economic Rehabilitation Fund (ERF) worth Rs. 100 billion, announced by then Minister for Finance Dr. Ram Sharan Mahat in the budget unveiled just a few months of the earthquake.

He had earmarked Rs. 5 billion to the fund.

The successive Finance Ministers Bishnu Prasad Poudel and Krishna Bahadur Mahara also included the ERF in their budget, but the fund has been lying idle, and promises of business recovery have been unmet.

The major stakeholders of the fund – Nepal Rastra Bank (NRB), Ministry of Industry (MoI) and the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) – admit that efforts to activate the fund have been sluggish, and are unhappy about it.

The central bank had established the ERF through the Monetary Policy of s016/17.

“The government has already earmarked Rs. 5 billion for this fund, and 44 banks and financial institutions have expressed their commitment to deposit Rs. 29.59 billion as of mid-June 2016,” the monetary policy read.

The fund was supposed to provide credits of up to Rs. 100 million, extended in specified areas, at a subsidised interest rate of 4 per cent and 2 per cent on loans of more than Rs. 100 million during the first six months of 2015/16.

“Likewise, BFIs can extend loans to earthquake victims at a maximum 5 per cent interest for a specific business. The refinance facility can be availed from the fund at 1.5 per cent. Such facility will be provided on the entire loan amount of up to Rs. 50 million, and above this limit, the refinance facility will be provided only on 20 per cent of the excess credit limit,” said the policy.

NRB spokesperson Narayan Prasad Poudel said that progress to realise the Fund couldn’t pick up momentum as the process was initiated very late after formulating the manual and asking the banks to send data of the quake-affected business to the central bank.

The NRB had issued a circular to the BFIs on January 24, 2016 in line with the Economic Rehabilitation Fund (Establishment and Operation) Manual, 2015. The manual was approved by the government just a day before the issuance of the circular.

“It’s been only a couple of months since we have actually worked on the ERF. The NRB is analysing the data collected from the banks,” he said.

The NRB also said that the banks and financial institutions had not demanded any fund support for the quake-damaged industries.

Meanwhile, there are chances that the ERF will not be mobilised for some time in the future as the budget of the next fiscal year plans to merge it with other government-run funds.

“A study will be carried out to establish a strong and effective institution by merging funds like the Youth Self Employment Fund, Rural Self Reliance Fund, and Economic Revival Fund,” reads the budget of the fiscal year 2017/18.

The MoI and FNCCI said that both institutions did not have data of the damaged businesses.

“The private sector is not enthusiastic about the Fund since it involves a very complex process to obtain financial support. We had recommended to the government and NRB to simplify the process, but they didn’t incorporate our suggestions,” said senior vice-president of the FNCCI, Shekhar Golchha.

According to Purushottam Nepal, spokesperson of the MoI, the ministry is waiting for the guidelines document from the NRB, and the former has not received any complaints or applications from the businesses seeking rehabilitation.

Director of the FNCCI Meena Shrestha said that no data had been demanded from the business body by the ministry or the NRB so far.

The Post Disaster Needs Assessment (PDNA) conducted by the government in the immediate aftermath of the tremors had estimated that the business sector witnessed damage of more than Rs. 36.22 billion in the 14 severely hit districts alone.

Damage to the commercial sector was estimated at Rs. 16.95 billion and industrial sector at Rs. 19.27 billion. 

(Published in The Rising Nepal, 23 June, 2017)

NRA seeks help of local representatives in distributing grant

Kathmandu, June 21: As a remedy to the sluggish distribution of the house reconstruction grant to the families who lost their home in the devastating Gorkha Earthquake 2015, the National Reconstruction Authority (NRA) has sought help from the recently elected representatives of the local units.

The reconstruction body Wednesday appealed to the local units to facilitate the grant distribution so that the beneficiaries receive the second installment of the grant, Rs. 150,000.

"The NRA has sought help from the Ministry of Federal Affairs and Local Development in mobilizing the local representatives in all quake-affected districts to facilitate people in reconstruction. It has sent a circular to the ministry for the same," the NRA said in a statement.

A meeting of the NRA Executive Committee had decided to send circulars to all rural municipalities, municipalities, sub-metro and metropolitan cities, as well as the District Coordination Committee (DCC) of the districts where the election is yet to be held.

Deputy spokesperson of the NRA Dr. Bhishma Kumar Bhusal said that the reconstruction body had urged the local bodies to create an environment where the beneficiaries could claim the second tranche of the grant by the end of the current fiscal year, July 15.

According to him, the NRA has asked the local representatives to facilitate the quake-affected families, who received the first installation of the grant money by mid-January this year, to complete their home up to the plinth level by July 15 so that they claim the second installment.

"Local body chiefs are requested to mobilise all ward officials and support in reconstruction and distribution of grant money. Similarly, representatives of the moderately-affected 17 districts are urged to facilitate in signing the grant agreement and distributing the first installment by July 15," read the circular addressed to the local body chiefs.

 Similarly, the reconstruction body has also asked the local bodies to sign grant agreement with the quake-affected families that were included in the beneficiaries list following the grievance hearing, and sending the document to the DCC, and facilitate in distributing grant money to them.

The NRA has distributed the second installment money to only 39,589 families and third installment to only 3,292 families while it is yet to sign the grant agreement with roughly 150,000 families.

More than 725,000 households, of the 900,000 houses damaged in the quake, were recognized eligible to receive the housing grant.

According to the NRA, as much as 28,222 houses were built in 14 severely hit-districts.

China positive to exploring prospect of coop in new areas

Kathmandu, June 21: During a courtesy call on Prime Minister Sher Bahadur Deuba, Assistant Minister of the Chinese Ministry of Foreign Affairs Kong Xuanyou shared that China was very positive towards exploring the prospects for cooperation in new areas.

He paid a courtesy call to the PM at the latter's office at Singha Durbar on Wednesday and expressed happiness on the agreement signed between the two neighbours, on Tuesday at the 11^th meeting of the Diplomatic Consultation Mechanism, to further deepen cooperation in the existing areas and explore the prospects of cooperation in new avenues.

The meeting agreed to work jointly to reopen the Tatopani-Zhangmu border point at the earliest, and work to implement various projects on cross-border connectivity, infrastructure development, diversification of Nepal's trade, promotion of investment and tourism as per the Memorandum of Understanding (MoU) on cooperation under the Belt and Road Initiative signed by between the two countries on May 12.

Kong led a 12-member Chinese delegation to the meeting.

He also called on Deputy Prime Minister and Minister for Foreign Affairs Krishna Bahadur Mahara at the Ministry where both the leaders discussed about further collaboration on implementing the Belt and Road Initiative and establishment of the Cross-border Economic Zones between Nepal and China.

The Assistant Minister is returning to China Thursday morning. 

China agrees to reopen Tatopani

Kathmandu, June 20: Nepal and China have agreed to work jointly to reopen the Tatopani border point at the earliest.

The 11^th meeting of the Diplomatic Consultation Mechanism - a bilateral Foreign Ministry level body involving the Ministries of Foreign Affairs of both neighbours - at Singha Durbar on Tuesday agreed to resume the northern border point, which had been out of operation following the destruction caused by the devastating Gorkha Earthquake in 2015.

Nepal has been time and again urging China to reopen the Tatopani border point. It has been a major agenda every time a prime ministers of Nepal visited the northern neighbour.

"The Nepali side emphasised the need of the early resumption of the Tatopani-Zhangmu border point. The Chinese side responded positively to Nepal's proposal," read a statement issued by the ministry.

According to the ministry, Nepal expressed the hope that cross-border connectivity, infrastructure development, diversification of Nepal's trade, promotion of investment and tourism would receive priority while implementing the Memorandum of Understanding (MoU) on cooperation under the Belt and Road Initiative sighed by the two countries on May 12.

The meeting discussed ways to further enhance coordination and facilitation for the promotion of Nepal's tourism prospects in China in the context of the Chinese Government's announcement of 2017 as 'Nepal's Tourism Promotion Year in China'.

Both the countries shared views on maintaining the tradition of regular exchange of high level visits.

Foreign Secretary Shankar Das Bairagi and Chinese Assistant Minister of the Ministry of Foreign Affairs Kong Xuanyou led the delegations of their respective countries.

Bairagi led a 21-member delegation comprising senior officials from the MoFA as well as representatives of other ministries and agencies while Kong led a 12-member delegation comprising Chinese Ambassador to Nepal Yu Hong and other senior officials of the Foreign Ministry and Chinese Embassy in Kathmandu.

The visiting assistant minister is scheduled to pay courtesy calls on Prime Minister Sher Bahadur Deuba and Deputy Prime Minister and Minister for Foreign Affairs Krishna Bahadur Mahara Wednesday.

He will also visit the reconstruction projects in Kathmandu that are being implemented with Chinese grant assistance.

The Joint Consultation Mechanism was set up in 1996 as a platform for discussing matters of mutual concerns and cooperation at the senior officials’ level between the Foreign Ministries of Nepal and China.

The meeting was held after four years. The 10^th meeting was organised in Beijing in 2013. 

Singhadurbar to be covered with silpaulin sheet

Kathmandu, June 20: The National Reconstruction Authority (NRA) has begun work to preserve the western face of Singha Durbar – the main administrative building of the government.

The reconstruction body said Tuesday that the work was being carried out to save the historic building from further external damages.

"As the monsoon is approaching fast, it is necessary to preserve the western part of the building, which is 33,100 square feet in area. Therefore, work has been started to cover the damaged part of the building with silpaulin sheet – a special type of tarpaulin," said the NRA in a press statement.

It said that it would take about a week to cover the building with silpaulin sheets.

Meanwhile, the NRA has completed the tender process for the scaffolding, a temporary structure on the outside of a building, made of wooden planks and metal poles, and the tender has been awarded to Map Entrepreneur Company for Rs. 14.1 million.

NRA's 45^th meeting on February 7 had formed a committee to reconstruct the western part of Singha Durbar's main building.

The committee is led by the Authority's executive member Dr. Hari Ram Parajuli and includes NRA spokesperson Yam Lal Bhoosal, representative from the Department of Archaeology, NRA and Ministry of Urban Development, as well as archaeologists Rohit Ranjitkar, Santosh Shrestha and Rabindra Puri as members.

 The committee will reconstruct the main building of Singha Durbar without dismantling it.

The building was severely damaged in the Gorkha Earthquake of 2015. 

Nepal tops the world in remittance-GDP ratio

Kathmandu, June 19: In terms of remittance to GDP (Gross Domestic Product) ratio, Nepal has topped the world.

The size of the remittance has reached 32 per cent of the Gross Domestic Product (GDP), making Nepal a country that heavily depends on the money sent back home by the migrant workers.

According to the latest report ‘Sending Money Home: Contributing to SDGs, one family at a time’ by the International Fund for Agricultural Development (IFAD), in the last 10 years, Nepal’s reliance on remittance has almost doubled from 17 per cent in 2007.

Nepal received US$ 6.27 billion in 2016, which constitutes almost one third of the GDP, and it is higher than 262 per cent than in 2007.

Top five countries that rely on remittances are Nepal, Tajikistan – 29 per cent, Kyrgyz Republic – 26 per cent, Samoa – 17 per cent and Marshall Islands – 14 per cent.

A decade ago, Tajikistan was the top reliant country with 45 per cent, and Nepal ranked fifth.

The top remittance receiving countries are India, China, the Philippines, Pakistan and Bangladesh with 62.7 billion, 61 billion, 29.9 billion, 19.8 billion and 13.7 billion US dollars respectively.

Two of the world’s largest economies -- India and China -- have a 3.3 per cent and 0.6 per cent remittance to GDP ratio. China received US$ 61 billion in  remittances in 2016, and India $62.74 billion.

The remittance inflow to India was $37.2 billion a decade ago.

In south Asia, the Maldives witnessed a negative trend in remittances. It witnessed 52.7 per cent negative growth in remittance inflow.

The report said that Asia was the highest originating region with 77 million migrants, with 48 million remaining within the region.

“Migrating to neighbouring countries is common, with bi-directional corridors, such as India-Nepal, and one way corridors such as Myanmar to Thailand. The Gulf states are a primary destination for migration workers from the South Asian nations and Indonesia and the Philippines,” reads the report.

In Europe, Moldova has the highest remittance-GDP ratio with 23.5 per cent, and Poland has the lowest reliance on remittance with 1.4 per cent of remittance to GDP.

Haiti has an economy reliant on remittance, with 24.7 per cent to GDP, in Latin America and the Caribbean. Likewise Gambia is a remittance-reliant country in Africa. It has a 22.4 per cent remittance size in comparison to the GDP.

The report says that between 2015 and 2030, an estimated USD 6.5 trillion in remittances will be sent to low and middle income countries, and it will contribute to increased income, better health and nutrition, educational opportunities, improved housing and sanitation, entrepreneurship and reduced inequality.

“Regular remittances lift most families out of the poverty line and help them avoid falling back into ‘poverty traps’,” reads the report.

The IFAD study found that women now comprise about half of all remittance senders (100 million), and more than $100 billion in remittances are available to cover long-term goals, such as education and health, and housing, small assets and other income-generating activities.

Likewise, global remittances to developing countries increased by 51 per cent. 

Create a level playing field for Nepali investors

Shekhar Golchha

Senior Vice-President, FNCCI

The economy is set to see almost 7 per cent growth in more than two-and-a-half decades. The government and political parties have shown seriousness about the economic agenda. Many foreign and domestic investors are pouring their money in different sectors. But the private sector is slightly discouraged as the government has failed to heed the reforms as suggested by it. 

Against this backdrop, Modnath Dhakal of The Rising Nepal talked to Shekhar Golchha, senior vice-president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI). Golchha, who is also the head of the largest business house in the country, the Golchha Organisation, has already been anointed as the next chief of the FNCCI. He spoke his mind on various economic issues. Excerpts;

How do you assess the current business environment in the country?

As per my assessment, the current business environment can be termed as ‘a lost opportunity'. The GDP growth rate has reached almost 7 per cent after two-and-a-half decades, but we are not prepared to sustain the economic progress. It needs a better vision and policies to utilise the opportunities created by the higher economic growth rate. We are over dependent on remittances, which have contributed to higher consumption and better revenue collection. Our per capita income has also improved because of the remittances. The growth rate of remittance is decreasing while incidents relating to diplomatic tensions in Qatar might have severe repercussions for our foreign employment, which can put pressure on us. We do not seem to be paying much attention to all these variables that can directly or indirectly hit the economy in the future. We need to increase exports, and for that the cost of doing business should be drastically brought down in order to be competitive in the international market. Likewise, the spread rate should be narrowed down.

The FNCCI has presented its recommendations to the government to provide subsidy to export-oriented businesses, and remove the cartels and syndicates in the transport and other sectors. The cartels have significantly increased the transport cost. Similarly, non-tariff barriers and lack of infrastructure are also the reasons behind the poor business environment in the country. Increasing export and attracting foreign direct investment (FDI) can be a remedy to the balance-of-payments problem should remittances fall.

What exactly should be done to attract FDI?

There are still some hurdles in attracting FDI. The Foreign Investment Act has just been approved by the Cabinet and may take many months to get it passed in the Parliament. Many other policies and legal instruments as well as procedural reforms need to be implemented at the earliest to facilitate the foreign investors.

The Labour Act and Social Security Act should be enacted as soon as possible, otherwise the provisions of the Industrial Enterprise Act, which were approved by the Parliament last year, cannot be implemented. I have heard that the Social Security Act was okayed by the Parliamentary Committee recently and Labour Act will also be taken forward as soon possible. The private sector is hopeful that more policy reforms will be carried out to improve the business environment.

The import-export gap is ever increasing while most of the businessmen are shifting to trade. Has the manufacturing sector lost its charm?

When the government is revenue-oriented and makes revenue collection its topmost priority, the private sector automatically moves to trading. The bureaucracy still believes that if the revenue collection increases, the decision is right else it thinks otherwise. If any government decision contributes to loss of revenue to any extent, it's not considered to be a good decision. They think that increased revenue is always in the 'national interest'. We still need many facilities, like subsidy and trade facilitation, in order to successfully run manufacturing and export-oriented industries.

Strikes have almost become a thing of the past, and there is a seamless supply of electricity. Furthermore, the government is very positive about fulfilling the demands of the investors and businessmen. Will these developments not have a positive impact on the economy?

The electricity problem has been solved by 70 per cent, and for the very reason, industrial productivity has increased by more than 10 per cent. So we can say that the industrial sector is growing faster than the national economy. We have been receiving investment commitments from both domestic and foreign investors in large projects, like hydropower and cement. Likewise, bank lendings have also increased significantly this year. Therefore, I believe that the private sector is enthusiastic and hopeful about the business environment in the country and will invest more. But, there are certain things that the government should do. We simply lack infrastructure. Roads are insufficient and are of poor quality, the capacity of the international airport has been saturated. We have suggested the government to address these problems in the next fiscal year budget.

The private sector is unhappy with the budget of the coming fiscal year 2017/18 because, as you said, it did not incorporate the suggestions given by the business bodies, such as the FNCCI. What recommendations were not accommodated in the budget?

As I said earlier, we had recommended to the government to expedite the construction of infrastructure such as roads, airports and railways. Similarly, we asked for subsidy for export-oriented business and trade facilitation, tax reforms, prioritising the energy sector and many more. There were also many suggestions from the district chambers of commerce and industry. But due to the election code of conduct, the government couldn't accommodate our suggestions or announce new policies and programmes. Here, what I would like to say is that the economic agenda should not be overshadowed by the country’s politics. The first priority should be the economy, and it should not be ignored in any situation.

It is high time to develop our infrastructure on a war footing. The economy should be the main agenda of the government and all the political parties. Sad to say, the political parties seem to be paying only lip service to the economic agenda.

The government was successful in having foreign investors commit about Rs. 1.4 trillion at the Nepal Investment Summit. How much of this will materialise?

The success of the Investment Summit has delivered two messages: there are many foreigners who want to invest in Nepal, and there have been positive developments in the country which will make the country even better in the future. We should take it positively, although it's up to us to realise the intended money.

 What would be the role of private sector business associations like yours and individual businessmen in realising the intended investment?

Sometimes, we put the cart before the horse. Without making significant reforms in policy and process, we must not dream of attracting large FDI. The new Foreign Investment and Technology Transfer Act, and Labour Act are yet to be ready while the environment-related laws are not investor-friendly. Every foreign investor minutely observes the legal provisions, including the business registration and exit process of the destination country. They are concerned about what would happen when they close their business here and want to move out. We have not done much in this regard. It’s very inspiring that the foreign investors expressed their intent to invest a large amount of money in Nepal. I don't want to say that we will fail, but we must expedite the process to reform the policy and create a better business environment in order to materialise the intended investment. It's up to us to realise the amount of money we want to actually bring in. As a co-partner in organising the summit, we are very positive in this regard and will extend every possible help to the government.

Some of the businessmen don't want a foreign rival, especially a large one, in the business sector. Cement is an example. In such a scenario, how can we believe that the government will be getting support from the private sector?

I don't think Nepalese businessmen are against FDI. But we are concerned about the facilities that are provided to a foreign investor but not to a Nepali one in the same sector. The government should not favour the foreign investors at the cost of domestic business, and ensure a level playing field for the Nepali businesses. Some sectors should be protected. The government has signed BIPPA (Bilateral Investment Promotion and Protection Agreement) with foreign countries, including India. What has it done to protect domestic investment? We have raised such issues with the government.

The FNCCI had created a project bank a couple of years ago. Has there been any progress on selling those projects to investors?

The project bank was very popular, and many domestic and foreign investors had taken references from it in establishing their businesses. However, we have not assessed the current status of the project bank’s implementation.

You belong to a family that has a long history of association with business, including trade, manufacturing and service. To what extent has a family business like yours promoted a corporate culture in Nepal?

As of now, we don't have an alternative but to bring in a corporate culture in our business. Professional management is the key to staying aloft in market competition and making a business successful. Traditional family businesses have been adopting professional management for the last one-and-a-half decades. As business grows, you have no choice but to resort to the modern management system. 

(Published in The Rising Nepal Daily, June 19, 2017/Asar 5, 2074)