ADB, WB for timely project implementation

Kathmandu, Sept. 29

Officer-in-Charge of the Asian Development Bank (ADB) for Nepal Arnaud Heckmann said that timely project implementation is essential for maximising the positive impact of development projects, ensuring efficient resource utilisation, and delivering development results on the ground.

"We will continue to collaborate with implementing agencies to mitigate potential delays and ensure that our projects remain on track,” said Heckmann while speaking at the Joint Tripartite Portfolio Review Meeting organised by the Government of Nepal, ADB, and World Bank in the Capital on Friday.

The meeting was convened to assess the progress of projects supported by ADB and the WB and address key issues to improve portfolio performance, read a statement issued by the stakeholders of the meeting.

Speaking on the occasion, World Bank Country Director for the Maldives, Nepal, and Sri Lanka Faris Hadad-Zervos said that the WB appreciates the government’s efforts towards expediting project implementation and ensuring timely delivery of externally and domestically financed projects on the ground.

 “We are committed to working together to enhance project performance and prioritise tangible development results for the betterment of the Nepali people, particularly those who are marginalised and vulnerable. Nepal has been able to do this in the past, and there is no reason why we cannot optimise performance again,” he said.

The meeting was chaired by Finance Minister, Dr. Prakash Sharan Mahat and Finance Secretary Krishna Hari Pushkar, and attended by secretaries of the Government of Nepal, senior officials, project directors, and staff from ADB and the World Bank.

Participants shared the current progress and engaged in discussions about the constraints and challenges that, if left unaddressed, could potentially impede the overall portfolio performance.

FM Dr. Mahat, expressed appreciation to ADB and the World Bank for their support to Nepal's development over the years.

"Today's meeting was important in terms of identifying collective issues that require improvement and correction. This entails interdepartmental coordination to expedite tasks, ensuring that development projects stay on track to achieve their intended outcomes for the people of Nepal and contribute to poverty reduction and sustainable development. The Ministry of Finance remains committed to timely budget allocation," said the minister.

The Ministry of Finance, relevant ministries, implementing and executing agencies, ADB, and the WB have agreed on specific actions to overcome the challenges and help project implementation and disbursement pick up pace.

Published in The Rising Nepal daily on 30 September 2023. 

FM Dr. Mahat stresses on innovation in financial aid mechanism

 Kathmandu, Sept. 28

Finance Minister Dr. Prakash Sharan Mahat has emphasised at the meeting of the Board of Governors of the Asian Infrastructure Investment Bank (AIIB) on the necessity for innovation in the financial aid mechanism for the infrastructure needs of the developing nations.

"There is an inadequacy of the current financial aid mechanisms and tools for the infrastructure development needs of developing member nations. Therefore, priority should be given for innovation in this sector," he said upon his arrival in Kathmandu from the meeting of the AIIB on Thursday.

FM Dr. Mahat has returned home on Thursday after participating in the eighth meeting of the Board of Governors of the AIIB. The meeting, attended by representatives from 86 member nations of the bank, took place in Sharm El Sheikh, Egypt.

To address the funding gaps in developing countries, he advocated the adoption of novel and creative approaches, such as public-private partnerships, green bonds, and blended finance, the Ministry of Finance (MoF) informed in a statement.

Dr. Mahat noted that multilateral development banks, including AIIB, have made substantial contributions to low-income countries in areas such as economic recovery, job creation, green infrastructure development, improved access to financial resources, enhancement of technical and institutional capacity, climate-induced disaster management, and social security.

Furthermore, Dr. Mahat emphasised the importance of increased climate finance and related facilities for countries like Nepal and other developing nations that bear the brunt of climate change effects, despite not being significant contributors to carbon emissions.

During this high-level gathering, Finance Minister Dr. Mahat urged all member nations to endorse Nepal's proposal for the establishment of a dedicated concessional mechanism tailored to the needs of underdeveloped countries such as Nepal, read the statement.

He emphasised the significance of concessional financial assistance in addressing critical developmental challenges.

In the course of the meeting, FM Dr. Mahat highlighted three major global challenges: ensuring the stability of the world economy, accelerating progress towards zero carbon emissions, and promoting the economic development of low and middle-income nations. He underscored the pivotal role that multilateral development banks, including the Asian Infrastructure Investment Bank, must play in addressing these challenges.

As a panelist in a discussion on climate change issues and the mobilisation of climate finance during the eighth annual meeting of AIIB, FM Dr. Mahat presented a compelling case for Nepal's vulnerability to climate change and elucidated the associated challenges.

He particularly called upon developed economies and major carbon emitters to fulfill their commitments to combat climate change, recognising the difficulties faced by developing nations like Nepal, which have a limited role in causing the problem.

Meanwhile, FM Dr. Mahat urged all participants to review carbon trading prices and maintain a fair and reasonable pricing structure.

NICCI President suggests tapping economic potential in Indo-Pacific region

 Kathmandu, Sept. 29

Shreejana Rana, President of the Nepal-India Chamber of Commerce and Industry (NICCI), addressed the Indo-Pacific Economic Conclave 2023, organised by Bengal Chamber of Commerce and Industry (BCCI) in India, said that there is a vast economic potential in the Indo-Pacific region.

She highlighted its economic vitality, cultural diversity, and innovative capacity while acknowledging the challenges impeding progress, NICCI said in a statement.

Rana touched on critical issues such as infrastructure gaps, logistical inefficiencies, and the disruptive impact of COVID-19 on supply chains. According to NICCI, her speech encompassed topics like cargo shipment, infrastructure development, logistics optimization, supply chain efficiency, and visa regulations.

She proposed comprehensive solutions, including improving regional connectivity through infrastructure development, simplifying trade agreements, harmonising regulations, and promoting supply chain flexibility.

Rana also advocated for bilateral labor movement agreements to address labor shortages and emphasized the importance of digitalization and e-commerce for seamless cross-border trade.

Recognising the importance of environmental considerations, Rana urged collaborative efforts for sustainable practices and eco-friendly trading. She emphasized cultural exchanges, educational programs, and tourism to foster greater cooperation, unity, and regional identity.

Rana highlighted collaborative research, innovation initiatives, and disaster management efforts as drivers of economic growth and technological advancement. She proposed the establishment of early warning systems and joint response teams to mitigate the impact of natural disasters.

In a significant move, NICCI and the Bengal Chamber of Commerce and Industry (BCCI) signed a Memorandum of Understanding (MoU) to realise the Indo-Pacific region's potential, promote economic cooperation, and foster a prosperous, interconnected future.

Published in The Rising Nepal daily on 30 September 2023. 

Spark Adventure 2023 begins

Kathmandu, Sept. 29

The Spark Adventure 2023 has officially begun, with over 200 enthusiastic participants embarking on an exciting expedition to Sailung, a tourist destination in Dolakha district. The event, organised by Spark Cars, the adventure commenced at Mirabel Resort in Dhulikhel on  Thursday.

Sailung, often referred to as the confluence of numerous small hillocks, holds both religious significance and the distinction of being a prime 'hill station' with its vast expanse of snow-capped peaks. The organisers emphasise that Sailung epitomizes a harmonious fusion of nature and environment, rendering it an irresistible destination for avid tourism enthusiasts.

Padam Parajuli, General Manager of Spark Group, underscored the need to draw attention to Sailung, which, despite its immense potential, remains relatively undiscovered.

The theme of this adventure is 'Wild Stay with Chaunri (yak),' focusing on the lives of local yaks and their herders.

The event is attended by Captain Bijay Lama, actor Nikhil Upreti, singer Yash Kumar, comedian Sandeep Chhetri, and other renowned artists like including folk singer Prem Raja Mahat, artiste Garima Sharma, writers Buddhi Sagar and Dr. Ranjit Baral, comedian Kailash Karki, traveller Srijana Sijju, artiste Swanika Bastola.

The three-day event is being organised from September 28 to 30.

This is the second edition of Spark Adventure, following last year's successful honey-hunting expedition in Bhujung of Lamjung district.

Published in The Rising Nepal daily on 30 September 2023. 

FDI inflow far below targets, commitments

Kathmandu, Sept. 28

Realisation of the Foreign Direct Investment (FDI) in Nepal has remained poor over the years, with just 36.2 per cent net inflow in 27-year period since 1995.

Only in the Fiscal Year 2011/12, the total FDI inflow surpassed the total commitment and reached 128.8 per cent with the commitment of Rs. 8.13 billion and inflow of Rs. 9.19 billion, according to the Survey Report on Foreign Direct Investment in Nepal (2021/22) published by the Nepal Rastra Bank on Wednesday.

Likewise, the inflow was 88.8 per cent in 2016/17 which was the aftermath of the devastating 2015 earthquake that damaged properties worth more than Rs. 600 billion. That year, Nepal received the FDI of Rs. 13.5 billion. But in 2017/18 it went down to just 31.4 per cent with the inflow of Rs. 17.5 billion against the pledge of Rs. 55.7 billion.

Likewise, the largest FDI inflow was received in 2020/21 when Rs. 19.5 billion was channelised into the country. The FDI inflow remained negative in 2000/01, 2001/02 and 2005/06.

Nepal has FDI from 57 countries by the end of the Fiscal Year 2021/22 (mid-July 2022) amounting to Rs. 264.33 billion.

Of the total FDI that the country received, paid-up capital makes 53.7 per cent share, reserve fund 31.7 per cent and loan 14.6 per cent. The FDI stock was increased by about 16 per cent in 2021/22.

According to the report, highest FDI – Rs. 88.59 billion – has come to Nepal from India, followed by China Rs. 33.45 billion, Ireland Rs. 20.90 billion, Singapore Rs. 16.07 billion and St. Kitts and Nevis Rs. 15.09 billion.

St. Kitts and Nevis is a famous tax haven.

Meanwhile, Nepal has remained as one of the countries in the South Asian region that receives a minimal amount of FDI. In 2022, India received US$49.4 billion FDI which is up by 10.3 per cent from 2021. Likewise, Bangladesh received US$ 3.5 billion and Pakistan US$ 1.3 billion while Nepal got only US$ 0.1 billion which is down by 66.8 per cent compared to 2021.

About 62.6 per cent of the FDI, that comes to Nepal, is mobilised in industrial sector, 37.3 per cent in service. However, in terms of industry-wide category, hydroelectricity has received 32.8 per cent of the total industrial sector FDI while banks and financial institutions have got 25.6 per cent of the service sector FDI.

The electricity, gas, steam and air conditioning sector, hydropower sector in particular, in Nepal has been a preferred sector for FDI in recent years. The latest survey shows that 32.8 per cent of FDI stock and 41.8 per cent of total paid-up capital is in this sector, read the report.

Moreover, hydropower sector has also attracted other sources of external financing such as foreign loans in addition to FDI; the electricity, gas, steam and air conditioning sector accounts for 41.4 per cent outstanding foreign loan at the end of 2021/22.

Other sectors that received FDI are accommodation and food services, information and communication, human health and social work, construction and agriculture, forestry and fishing.

Meanwhile, Bagmati Province has received the largest share of the total FDI inflow. It has 55.4 per cent of the total FDI stock with Rs. 146 billion investment. Koshi received 17 per cent (Rs. 45.05 billion), Gandaki 16.8 per cent (Rs. 44.4 billion) and Madhes 8.8 per cent (Rs. 23.3 billion). Karnali has received just Rs. 47 million, 0.02 per cent of the total FDI stock.

According to the report, companies established with the FDI are running at a capacity of 71.1 per cent and their average profit rate is 14.3 per cent.

The NRB had made conclusions on the basis of the survey of 231 companies established with the FDI. The central bank said that it has been preparing and publishing the reports on the FDI to support the government and concerned agencies in better policy formation.

Published in The Rising Nepal daily on 29 September 2023. 

PM urges Chinese investors to grab business opportunities

Beijing, Sept. 24

Prime  Minister  Pushpa  Kamal  Dahal  'Prachanda' and Nepali private sector have  assured  the  Chinese  business-persons and investors of  the immense investment  potential  and  security  in  Nepal. “The business environment has been improved  with  the  establishment  of   one-door  service  centre  and  adoption  of   policy  reform  initiatives  as  well  as  energy   assurance,”   Prime   Minister   Prachanda said speaking at the Nepal-China  Business  Summit  jointly  organ-ised  by  the  China  Council  for  the  Pro-motion of  International Trade (CCPIT) and  Federation  of   Nepalese  Chambers  of  Commerce and Industry (FNCCI) on Sunday in Beijing of  China.

He  urged  the  Chinese  investors  to  grab  the  opportunities  that  Nepal  is  offering  in  various  areas  of   business  and  investment,  and  the  country  has  the  lowest  corporate  tax  rate  in  the  region.

 According  to  PM  Prachanda,  the  issue    of     enhancing    connectivity    between  Nepal  and  China  has  been  discussed  with  President  of   China,  Xi Jinping, in order to facilitate more economic   and   business   exchanges   between the two countries. "Nepal  is  an  attractive  destination  for FDI. It has the proximity to two of  the  world’s  largest  growing  markets. 

There is a huge potential of  attracting Chinese investment in infrastructure, energy, agriculture, tourism, ICT and other  service  areas,”  said  the  Prime  Minister.He said that Nepal counted on Chi-nese investment to fill our technolog-ical  and  strategic  gap. 

“We  need  to enhance  our  economic  engagement  with  the  neighbouring  countries  and  increase synergy and cooperation,” he stressed. According to PM Prachanda, Nepal wants  to  increase  its  export  to  China  and  for  it  there  is  a  need  to  improve  physical  infrastructure,  and  reduce  technical  barriers  of   exporting  agri-cultural products to China."Our  relations  have  flourished  on  the  foundation  of   mutual  benefits,  securing    mutual    interests.   

Since China is the largest source for FDI and second  largest  trade  partner,  Nepal  hopes  for  more  cooperation  in  this  regard,” he stated. This is PM’s third visit as the prime minister and fifth as a leader of  Nepal.

 

Opening   border   in   Tinker   and   Mugu

Speaking on the occasion, Vice-Min-ister  of   China’s  Ministry  of   Com-merce,  Li  Fei,  said  that  China  is  for  greater  economic  cooperation  with  Nepal.

"We want to promote high quality of  industrial  development  in  Nepal  and  support in agriculture and tourism sec-tor  development,”  he  said,  adding  that  Chinese  airlines  are  operating  more  flights  to  Nepal  which  will  support  in  the development of  tourism in Nepal. Li also said that he encourages Chi-nese  businesses  to  invest  in  textile,  food  processing  and  other  sectors  of   business  in  Nepal. 

He  also  informed  that  China  is  supporting  in  increas-ing the traffic capacity of  the Araniko Highway,    upgrading    Rasuwagadhi    Highway  and  expediting  the  feasibil-ity  study  of   China-Nepal  cross-border  railway.

According  to  Li,  China  will  work  with  Nepal  to  open  traditional  border  sites in Tinker in Darchula, and Mugu. He also stated that the northern neigh-bour of  Nepal is interested in promoting and supporting sustainable development in  Nepal. 

“We  will  organise  training  courses  on  trade  and  related  areas  for  Nepali entrepreneurs,” he said.

 

Nepal   needs   Chinese   investment,   tourists

Chandra  Prasad  Dhakal,  President  of   the  FNCCI,  said  that  the  summit  brought together business leaders from both countries to explore opportunities for  investment,  trade,  and  technology  transfer. 

He  expressed  his  confidence  that it will lead to clear outcomes that will benefit both Nepal and China.He stated that Nepal offers potential for  global  exports  as  it  has  duty-free  access  to  Nepali  products  in  China,  India, the United States, the European Union,  Canada,  Australia  and  other  developed  countries. 

This  opens  up  opportunities  for  investment  and  pro-duction  in  Nepal  and  export  to  global  markets.Stating that Nepal is committed to fur-ther  opening  up  to  foreign  investment,  technology transfer, public-private part-nership,   and   investment-related   poli-cies  to  attract  both  global  and  regional  FDIs,  Dhakal  informed  that  the  FNCCI  has established an FDI help desk to pro-vide  one-window  facilitation  support  to  foreign  investors. 

“We  plan  to  expand  this service to further support potential investors  and  existing  companies,”  he  said. He stated that Nepal is ready to wel-come more Chinese tourists and invest-ment  from  the  northern  neighbour  in  energy,  ICT  and  ICT-enabled  services,  mines  and  minerals,  and  agricultural  projects.

He said that the private sector in Nepal is looking forward to Chinese government  investment  including  the  newly built airports in Bhairahawa and Pokhara  as  the  preferred  destinations  for Chinese tourists.

Dhakal  said  that  Nepali  and  Chi-nese  traders  have  been  facing  trou-bles  in  bilateral  trade  as  there  is  no  Chinese  bank  operating  in  Nepal,  and  urged China to open one or establish a joint-venture with a Nepali bank. According   to   him,   trade   barriers   between the two neighbours should be removed,  and  the  Trade  Facilitation  Agreement   should   be   implemented   fully  to  increase  mutual  benefits  from  bilateral trade.

 

Support in economic diversification

Zhang  Shaogang,  Vice-President  of   CCPIT, said that China and Nepali busi-ness  communities  have  strengthened  their relations and cooperation in vari-ous business sectors including technol-ogy, infrastructure and energy. Zhang  also  stated  that  China  wants  to  contribute  in  the  economic  diversi-fication and development in Nepal, and showed  his  interest  in  creating  more  business   platforms   and   organising   exchange programmes.

"We need to deepen pragmatic coop-eration  in  industrial  development  and  supply  chain  development.  China  is  organising the Supply Chain Expo after a  couple  of   months,  we  want  Nepal  to  participate in the expo,” he said. Need  for  trans-Himalayan  connec-tivity Manoj  Poudel,  Chairman  of   Foreign  Investment   and   International   Affairs   Committee at the FNCCI, said that Nepal has witnessed a tremendous progress in ICT  business  in  the  past  few  years. 

He  also said that public-private-partnership could be one of  the areas where Chinese and  Nepali  businesses  come  together  in  developing  large  infrastructure  and  industrial bases.

He   maintained   that   establishing   trans-Himalayan  connectivity  would  propel   an   unprecedented   business,   investment and tourism growth in both the countries.  According  to  the  FNCCI,  the  busi-ness   summit   is   organised   with   the   aim  of   promoting  bilateral  trade  and  attract  Chinese  investment  to  Nepal. 

About  120  representatives  of   various  Chinese companies and about 50 Nepali businesspersons   participated   in   the   summit.  Likewise,  ministers  and  high  government officials of  visiting Nepali delegation  and  Chinese  government  also participated in the event. China   is   Nepal’s   second   largest   trade  partner.  About  16  per  cent  of   the total imports of  Nepal comes from China. 

However,  with  the  advent  of   COVID-19  and  tightened  of   borders,  exports to China have been disturbed which have begun to resume recently. The   visit   of    PM   Prachanda   also   aims  to  operating  the  border  points  smoothly and in full strength so that it would further facilitate the bilateral trade.

Published in The Rising Nepal daily on 25 September 2023. 

PM Prachanda embarks on week-long official visit to China

Kathmandu, Sept. 21

Prime Minister Pushpa Kamal Dahal Prachanda is embarking on an official visit of China from 23 to 30 September.

He is visiting the northern neighbour at the invitation of Chinese Prime Minister Li Qiang.

PM Prachanda is currently in New York of the United States of America to participate in the 78^th General Assembly of the United Nations.

Prime Minister Prachanda is scheduled to meet with Xi Jinping, President of China in Hangzhou, informed the Ministry of Foreign Affairs (MoFA) in a statement on Thursday.

He will hold a bilateral meeting with his counterpart Premier Li Qiang, and a meeting with Zhao Leji, Chairman of the Standing Committee of the National People’s Congress in Beijing. The Prime Minister will also address the China-Nepal Investment Summit jointly organised by the China Council for the Promotion of International Trade (CCPIT) and the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and Nepali Embassy in Beijing.

Prime Minister Prachanda will attend the opening ceremony of the 19^th Asian Games in Hangzhou on September 23.  

According to the MoFA, he is scheduled to visit Chongqing Municipality to observe the agricultural and industrial advancement of China. He will also visit Lhasa, Tibet Autonomous Region of China that borders with Nepal.

Nepal and China enjoy an excellent state of bilateral relations as good friends, close neighbours and trusted partners. "The pedestal of this strong relationship has been nurtured by many commonalities in culture, history, and geography. This visit will bolster our age-old bilateral relations and expand the areas of cooperation in various fields of mutual interest," read the statement issued by the MoFA.

The Prime Minister will be accompanied by his daughter Ganga Dahal, Narayan Prakash Saud, Minister for Foreign Affairs, Mahindra Raya Yadav, Minister for Water Supply, Prakash Jwala, Minister for Physical Infrastructure and Transport, Shanker Das Bairagi, National Security Advisor, Dr. Min Bahadur Shrestha, Vice-Chairman of the National Planning Commission, and other senior government officials as well as representatives from business community.  

The Nepali delegation will arrive in Kathmandu on 30 September 2023.

As said by Prime Minister Prachanda earlier, the visit aims to give new momentum to the bilateral relationship between Nepal and China. Effectively opening the border points is the top agenda for his visit so that seamless trade could happen between the two neighbours.

Other agenda include infrastructure development like roads and energy, agriculture, technology and trade. Enhancing the cross-border connectivity will also be a major agenda. Speaking at the Federal Parliament last month, PM Prachanda had also said that he had also given priority to the electricity trade and construction of Kimathanka Hydropower Project.

Since Nepal's trade deficit with China is going up rapidly, the country wants to find ways to create more balance in the trade between the two countries.

Likewise, Nepal wants to open the seasonal border points in Sankhuwasabha, Dolakha, Gorkha, Bajhang, Dolpa and Darchula permanently and upgrade them to facilitate the local people's movement across the border as well as facilitate cross-border trade. Nepal is also taking up the issue of opening of Ruila border in Gorkha, Urai in Bajhang and Tinker in Darchula for local people. 

 Published in The Rising Nepal daily on 22 September 2023. 

ADB projects Nepal's economy to grow by 4.3% in current fiscal

Kathmandu, Sept. 20

Nepal’s economy is expected to grow by 4.3 per cent at market prices in the current Fiscal Year 2023/24, up from an estimated growth of 1.9 per cent in FY 2022/23, says the September 2023 edition of Asian Development Outlook (ADO) published by the Asian Development Bank.

The ADB has also expected that the bank interest rates would go further down and economic activities would be stimulated.

The government has projected the economic growth of 6 per cent for this year.

"With moderation in inflation and comfortable foreign exchange reserves, the Nepal Rastra Bank adjusted its monetary policy stance by lowering the policy rate by 50 basis points to 6.5 per cent, which is expected to help lower commercial interest rates and stimulate economic activities," Jan Hansen, Principal Economist, ADB Nepal Resident Mission, said at a programme organised to launch the report in Nepal.

Services are expected to perform well with expansions coming from real estate, wholesale and retail trade and accommodation and food services. Agriculture growth may, however, decelerate owing to deficient rainfall in June and erratic weather patterns, further aggravated by lumpy skin outbreak in cattle, said the ADB.

The report projects annual average inflation to fall to 6.2 per cent in 2024 from 7.7 per cent in 2023 on subdued oil price increases and a decline in inflation in India, Nepal’s main source of import.

According to the central bank of Nepal, inflation stands at 7.52 per cent in mid-August this year.

“Despite some progress in restoring price and external sector stability, fiscal challenges persist. While the estimated fiscal deficit for FY2023/24 is moderate at 2.4 per cent of the Gross Domestic Product (GDP), much lower than the deficit of 6.1 per cent in FY2022/23, the actual deficit could be substantially higher if the government does not meet its ambitious revenue target for 2023/24,” said Hansen.

According to the ADB, external risks remain relatively well contained. Considering the recent trends and the central bank’s prudent monetary policy stance, the target of maintaining foreign exchange reserves sufficient to sustain at least seven months of imports seems achievable. Amid stable remittances and higher imports, the current account deficit is expected to widen to 1.8 per cent of the GDP as growth revives in FY2023/24.

Downside risks to the economic outlook in 2023/24 may arise from more contractionary economic policy by the authorities to stem price rises given the uncertainties centered around geopolitical tensions, maintained the ADB. This may dampen consumption and domestic production and adversely affect growth.

Manbar S. Khadka, Senior Economics Officer, ADB Nepal Resident Mission, said that increasing revenue is a challenge for the government. However, he expressed hope that the policies announced in the budget of the current FY 2023/24 could help in achieving the higher revenue although the annual target is 'quite ambitious'.

In its Nepal member factsheet, the ADB said that weak governance has long affected the effectiveness of development assistance to Nepal. "The country faces challenges towards ensuring the smooth implementation of federalism. These include limited capacity at subnational levels and slow progress in passing needed legislation and deploying staff, as well as lack of clarity on mandates and responsibilities and coordination among the three tiers of government," read the factsheet.

ADB has committed 494 public sector loans, grants and technical assistance of about US$7.7 billion to Nepal. However, cumulative loan and grant disbursements to Nepal amount to US$ 4.91 billion. 

 Published in The Rising Nepal daily on 21 September 2023. 

Capital budget expenditure witnesses slight improvement

Kathmandu, Sept. 19

The government's performance in the utilisation of the capital budget has been better this year compared to the previous two years. However, in numbers, the improvement is not encouraging.

In the first two months of the current Fiscal Year 2023/24 (mid-July to mid-September), development expenditure has reached Rs. 8.35 billion which is 2.77 per cent of the total capital allocation of Rs. 302 billion, according to the statistics of the Financial Comptroller General Office (FCGO) – an agency under the Ministry of Finance that manages the treasury operation of the government.

Finance Minister Dr. Prakash Sharan Mahat had announced the budget of Rs. 1751.31 billion for this year. It also included Rs. 1141.78 billion for recurrent expenditures and Rs. 307.45 billion for financing management. The financing part of the budget is used to service the government loan while a small part of it could be mobilised as investments.

This year's performance in terms of capital budget utilisation is an 'improvement' from previous years. In the last FY 2022/23, the government could spend only 1.54 per cent of the total allocation – Rs. 5.86 billion of Rs. 380.38 billion—in the first two months.

Likewise, in FY 2021/22, the country saw one of the worst capital budget performances with just Rs. 2.61 billion utilisation (0.69 per cent of the total allocation Rs. 378 billion) in the first two months of the fiscal year.

Meanwhile, the government's recurrent expenditures have been contracted this year. It has come down to 7.87 per cent of the total allocation while in 2022/23, size of recurrent expenditure was 9.25 per cent. The total recurrent budget mobilised this year is Rs. 89.8 billion against that of Rs. 109.4 billion last year.

The austerity measures in the govrnment's expenditure might have caused this decrease in the mobilisation of the recurrent budget, as claimed by the authorities at the MoF. FM Dr. Mahat had held marathon meetings with the concerned government agencies including the Department of Customs, development ministries, Inland Revenue Department, and sub-national institutions to improve both the expenditure and revenue performance.

However, in the first two months of 2021/22 when the country was under a raging Coronavirus pandemic, recurrent expenditures had been 5.5 per cent of Rs. 1065.2 billion.

Total government expenditure so far stands at Rs. 133.5 billion – 7.63 per cent of the total budget while it was Rs. 135 billion – 7.53 per cent last year.

But government revenue collection has not been encouraging in the first two months of the year. Total revenue collection in the two months is Rs. 143.9 billion this year while it was 143.8 billion last year. According to the private sector leaders, if this festive season failed to give impetus to the market, the government revenue would be badly affected.

Last year, the government could collect about 70 per cent of the annual revenue target and there was a gap of Rs. 398 billion in income and expenditure.

The private sector businesses, including the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and Nepal Chamber of Commerce (NCC), have been suggesting the government devise strategies to boost domestic production and demand so that the increased imports could meet the revenue target. Customs duty is the second largest source of income for the government after income tax.

Meanwhile, the latest report of the Nepal Rastra Bank has shown that the country is in a comfortable position in terms of foreign currency reserves with the capacity to finance the import of goods and services for more than 10 months. 

 Published in The Rising Nepal daily on 20 September 2023. 

VP Yadav suggests exploiting trade potential between Nepal, China

Kathmandu, Sept. 18

Vice President Ramsahay Prasad Yadav has said that there is potential to increase the size of trade between Nepal and China.

"Of the total foreign trade of Nepal, 14 per cent happens with China. There are many possibilities to expand it," he said to a Chinese delegation led by Zeng Yan, Member of the Standing Committee and Head of the Publicity Department of CPC Yunnan Provincial Committee that paid a courtesy call to Vice President Yadav at the latter's office in Lainchour on Monday.

VP Yadav also urged the Chinese leader to support Nepal in making the bilateral trade more sustainable, enhancing the capacity of Nepali producers in the areas of comparative advantage, and facilitating the export of vegetables, tea and herbal products to China.

According to a statement issued by the Office of the Vice President, he also stated that he was confident that the relationship between the two countries would be further strengthened at the people's level since people-to-people relations are one of the dimensions of harmonious bilateral relations.

"This visit will help further strengthen the cordial relations between Nepal and China," he said, "Nepal and China have remained close neighbours, close friends and reliable development partners."

VP Yadav said that the two countries stand together on the foundation of mutual support and partnership and each other's basic interests and sensitivity.

"In my opinion, high-level meetings, contacts and visits will be important to make our relations stronger and reach the people's level, so exchange of visits between the two countries should be given priority," he said.

Zeng Yan, who is leading the Chinese visiting team, expressed her happiness with the meeting and said that she would try her best to further deepen, and strengthen the relationship between the two countries.

 Published in The Rising Nepal daily on 19 September 2023. 

Nabil Bank launches 265th branch

Kathmandu, Sept. 18

Nabil Bank has inaugurated its 265^th branch in Namche of Solukhumbhu district.

Nabil has inaugurated the branch as its strategy to expand branches in the remote areas to expand banking reach, the bank said in a statement.  

Upendra Poudyal, Chairman of Nabil Bank inaugurated the branch jointly with Tshering Phenjo Sherpa, former ward office chair.

Speaking at the inaugural programme, Poudyal said that Nabil at Namche is not just for the business but it is to work in and for the community.

Sherpa expressed his gratitude towards the bank for marking its presence. He mentioned the important role of the bank for financial reach and economic growth in society.

Likewise, Gyanendra Prasad Dhungana, Chief Executive Officer of the bank, said that the expansion of the branch is to deliver quality banking service in the region and make access to finance easy. “We will give our best to provide the best service to our customers here to meet the financial need of the region,” he further added.

Nabil Bank is one of the leading commercial banks of Nepal. The bank has 265 branch networks with 306 ATM machine services along with more than 1.8 million customers across the country.

 Published in The Rising Nepal daily on 19 September 2023. 

Spark Cars to organise 'Wild Stay with Chaunri'

Kathmandu, Sept. 18

Spark Cars is organising a programme 'Wild Stay with Chaunri (yak)' in Shailung of Dolakha district.

"Shailung has lots of tourism potential but it couldn't be harnessed due to lack of publicity, so we are organising the wild stay programme under Spark Adventure 2023," said Amar Deep Bhattarai, Coordinator of the event.

Bhattarai informed that the second edition of Spark Adventure, which started last year by hunting wild bees (Bhir Mahuri) in Bhujung of Lamjung district, is being organised focusing on Shailung on the border of Dolakha and Ramechhap and its Chaurigoth.

Celebrities, administrative and security agency officials will participate in the event that will be organised from 28 to 30 October this year.

Captain Vijay Lama, Senior Advocate Surendra Bhandari, artistes Nikhil Upreti, Sandarbha Deep Chhetri, Dilip Rayamajhi, singer Yash Kumar, Garima Sharma and writer Buddhishagar, and traveler Srijan Sijju will participate in the event.

The journey to Sailung will start from Kathmandu on October 28. Organisers said that they will 'explore' Chauri Goth (yak sheds) and Shailung on October 29. In the evening of the same day, local food will be served to the guests and participants along with local cultural programmes.

Participants who wish to explore domestic tourism, spend a night in the forest with Chauri, discover local culture, delicious food and new picturesque rural destinations can participate in the programme.

Shailung offers 'panoramic view' of the Himalayas, high-altitude flowers and the incredible view of the highlands. The registration fee to participate in the programme is Rs. 30,000 for an individual.

Spark Car has been managing the transport service for tourists. 

 Published in The Rising Nepal daily on 19 September 2023. 

NA Chairman, Australian envoy Volk discuss direct flights between two countries

Kathmandu, Sept. 18

Chairman of the National Assembly, Ganesh Prasad Timilsina, and Australian Ambassador to Nepal, Felicity Volk have discussed operating direct flight services between Nepal and Australia.

More than 130,000 Nepalis are living in Australia.

Stating that there are a large number of Nepalis involved in various professions and businesses along with students, Chairman Timilsina emphasised that both countries can benefit from it if direct air flights can be operated between Australia and Nepal.

Bilateral interests, friendly relations and high-level visits were discussed in the meeting held at the Chairman's Office at the Singha Durbar on Monday.

According to the secretariat of Chairman Timilsina, during the meeting, he mentioned that since the establishment of diplomatic relations in 1960, Nepal and Australia have had a very harmonious and cooperative relationship.

He said that Australia has become an attractive educational destination for many Nepali students and said that if the number of scholarships given to Nepali students is increased, many students could benefit from it.

Ambassador Volk said that there are more than 130,000 Nepalis living in Australia and informed that Nepali language is the third most spoken language in Canberra.

She said that Nepal is a high priority for Australia and informed about the visit of the Speaker of the House of Representatives of Australia to Nepal in October.

 Published in The Rising Nepal daily on 19 September 2023. 

Monthly remittance soars to Rs.116.02 billion

Economy is in comfortable zone: NRB

Monthly remittance soars to Rs.116.02 billion

Kathmandu, Sept. 17

Record inflow of remittance and reduction in imports of goods owing to the decrease in demands has ushered the economy into a comfortable zone in terms of external sector management.

Due to depleting foreign currency reserves owing to the massive growth in imports of goods including luxury items like cars and liquors the external sector pressure had 'significantly increased' in the aftermath of the COVID-19 pandemic that the experts had feared the country could experience the 'Sri Lankan fate'. Sri Lanka had then run out of foreign currency reserves and had failed even to service its loans.

But remittance inflows in the first month of the current Fiscal Year 2023/24 (mid-July to mid-August 2023) have increased by 25.8 per cent to Rs.116.02 billion compared to an increase of 20.3 per cent in the same period of the previous year, according to a monthly report published by the Nepal Rastra Bank (NRB) on Sunday. Last year, remittance inflow in the first month stood at Rs. 92.21 billion.

Shrawan (mid-July to mid-August) is the ninth month that continuously witnessed the inflow of more than Rs. 100 billion remittance inflow.

In the US Dollar terms, remittance inflows increased 21.5 per cent to 879.8 million in the first month while it had seen an increase of 12.5 per cent in the same period last year. Inflation of Nepali rupee against the US dollars had also caused the highest growth in the remittance inflow in any months since the country began to receive it.

 

Net transfer up by 26.1

Net transfer to Nepal increased by 26.1 per cent to Rs.128.21 billion in the first month against the growth of 18.4 per cent in the same period last year.

The growth in the influx of remittance is also by the increased number of Nepali workers to foreign countries.

Number of Nepali workers (institutional and individual-new) taking approval for foreign employment had increased by 75.4 per cent in the first month of the last fiscal.

It has been decreased by 12.1 per cent to 39,152 in the review period. The number of Nepali workers (Renew entry) taking approval for foreign employment decreased 19.5 per cent to 16423 in the review period.

Likewise, decreased demands in the domestic market had checked the imports. During the first month of 2023/24, merchandise imports decreased by 1.6 per cent to Rs.129.24 billion compared to a decrease of 12.9 per cent a year ago.

 

Foreign currency reserves cross Rs. 1573 bn

Meanwhile, the foreign currency reserves have reached Rs. 1573.12 billion by mid-August with an increase of Rs. 34 billion from the previous month. Although the government and the NRB have lifted the control measures in imports and foreign trips, reserves have taken an upward trend. According to the central bank, the current foreign currency reserves are sufficient to cover the imports of goods for 12.5 months and imports of goods and services for 10.3 months.

Likewise, the current account has remained at a surplus of Rs.12.99 billion in the review period against a deficit of Rs.15.13 billion in the same period of the previous year. This has happened after about 33 months since the current account was in deficit since mid-November 2020.

In the US Dollar terms, the current account registered a surplus of 98.5 million in the review period against a deficit of 118.8 million in the same period last year.

 

Inflation, still poses challenge

Consumer price inflation is still high although it has significantly come down to 7.52 per cent by mid-August this year from 8.26 per cent a year ago.

According to the NRB, food and beverage inflation stood at 8.95 per cent whereas non-food and service inflation stood at 6.42 percent in the review month.

Under the food and beverage category, year on year price index of spices sub-category increased by 45.56 per cent, cereal grains and their products by 13.20 per cent, milk products and eggs by 12.19 per cent, restaurant and hotel by 11.05 per cent and vegetable by 10.80 per cent.

But price index of ghee and oil sub-category decreased by 15.13 per cent.

Similarly, under the non-food and services category, year on year price index of recreation and culture sub-category increased by 15.55 per cent, education by 9.10 per cent, housing and utilities by 6.93 per cent and furnishing and household equipment by 6.79 per cent. 

 Published in The Rising Nepal daily on 18 September 2023. 

Minister Bhusal stresses transfer of technologies from developed nations

 Kathmandu, Sept. 17

Dr. Bedu Ram Bhusal, Minister for Agriculture and Livestock Development, has expressed serious concerns over the technological and digital divide between the developed and developing nations, particularly, the Least Developed Countries (LDCs).

"We must keep on pushing for the transfer of technologies from the developed nations, which has not materialised even after decades in spite of concrete promises," he said while delivering a statement on behalf of the group of Least Developed Countries (LDCs) in G77 and China Summit in Havana, Cuba on Saturday.

According to the Permanent Mission of Nepal to the United Nations in New York, the summit was deliberated on the theme 'Current development challenges: the Role of Science, Technology and Innovation'.

Minister Dr. Bhusal also underlined the need of promoting science, technology and innovations (STIs) through public policies, incorporating them in education systems and encouraging technological entrepreneurship. He called for the cooperation of the global South to implement the Doha Program of Action for the LDCs, which features the development of STIs in LDCs as a key priority.

According to the Nepal Mission in New York, in his address, Minister Dr. Bhusal highlighted the importance of science and technology, including the latest technologies associated with the fourth industrial revolution, for socio-economic development, combatting climate change and fighting against pandemics and other vulnerabilities. 

He also shed light on the development policies and priorities of Nepal, including preparations to graduate from the LDC status.

The Summit adopted the Havana Declaration on “Current development challenges: the Role of Science, Technology and Innovation” as its outcome.

Meanwhile, Minister Dr. Bhusal also had a meeting with Ydael Jesus Perez Brito, Minister for Agriculture of Cuba, in the afternoon on Saturday. In the meeting, they shared views about the agriculture policies and priorities of the sector, focusing on how agriculture production could be increased with the help of mechanization and technology.

Minister Dr. Bhusal had reached Havana on September 14, leading the delegation of Nepal to the Summit, held from15 to 16 September, and is scheduled to leave Havana on September 17.

 Published in The Rising Nepal daily on 18 September 2023. 

PM Prachanda leaves for UNGA

Kathmandu, Sept. 16

Prime Minister Pushpa Kamal Dahal Prachanda has left for New York, United States of America on Saturday evening to participate in the 78^th General Assembly of the United Nations.

Speaker of the House of Representatives of the Federal Parliament, Devraj Ghimire, Deputy Prime Minister and Minister for Defense, Purna Bahadur Khadka, DPM and Home Minister Narayan Kaji Shrestha, Finance Minister Dr. Prakash Sharan Mahat, other ministers, chiefs of diplomatic missions in Kathmandu and high government officials reached the Tribhuvan International Airport to see off the Prime Minister.

Prime Minister Prachanda is leading a Nepali delegation to the UNGA. His team will stay in New York until September 21. The Nepali delegation will include Foreign Minister NP Saud, Prime Minister's chief political advisor, national security advisor, Chief Secretary Dr. Baikuntha Aryal, Foreign Secretary Bharat Raj Paudyal, other high-ranking government officials, Nepal's ambassadors to the USA and the United Nations, as well as members of the media.

FM Saud had already left for the UNGA on Tuesday, September 12.

The UNGA commenced on September 5 and will feature its high-level segment from the 18 to the 26 of this month. Dennis Francis from Trinidad and Tobago will preside over the UNGA.

The high-level panel discussions will revolve around the theme 'Rebuilding trust and reigniting global solidarity: Accelerating action on the 2030 Agenda and its Sustainable Development Goals towards peace, prosperity, progress, and sustainability for all.' PM Prachanda is scheduled to address the event.

In addition to his participation in various UNGA high-level programmes such as the 'Sustainable Development Goals Summit' and 'Climate Ambition Summit,' Prime Minister Prachanda will also engage in meetings with heads of state, government leaders, and delegations from friendly countries on the sidelines of the UNGA.

He is also expected to attend a dinner hosted by the President of the United States, Joe Biden.

Nepal, in its capacity as the Chair of the Global Coordination Bureau of the Least Developed Countries, will conduct meetings of the assembly, as it transitions from a least developed country. Furthermore, Nepal will actively participate in annual meetings such as the G-77 and China and those involving Landlocked Developing Countries (LLDCs), among others.

Following his involvement in the high-level sessions of the 78th General Assembly of the United Nations, Prime Minister Prachanda will embark on an official visit to China on September 22.

 Published in The Rising Nepal daily on 17 September 2023. 

Margin trading policy on anvil

Kathmandu, Sept. 16

The Securities Board of Nepal (SEBON) has said that the preparations for bringing a policy related to margin trading has reached the final stage.

Speaking at an interaction programme organised by the Nepal Association of Financial Journalists (NAFIJ), Chairman of the Board Ramesh Kumar Hamal said that a policy on margin trading will be announced in a few weeks. "The SEBON is set to announce a new policy on margin trading in a few weeks, the policy regarding margin trading that will flow through the broker will be implemented."

He also said that the Board will set separate qualifications for independent directors in hydropower and real sector companies.

Chairman Hamal said that the roster of independent directors will be prepared by the SEBON. "We are determining the qualifications of independent directors in hydropower and real sector companies, we are making a roster. We are making arrangement for the independent directors to submit the report to the independent auditor," he stated. He also said that the matter has been discussed with the Independent Power Producers Association of Nepal (IPPAN) as well.

He informed that 'intra-day trading' will also be implemented at the Nepal Stock Exchange (NEPSE). According to him, SEBON team has the courage and expertise to reform the securities market. Since the economic indicators are in course of improving, the investors should be confident to make investment, he said.

He also made it clear that he will not decide to reduce the commission of the brokers without adding more service to their business. "If brokers' commission is slashed, fee for SEBON would be reduced first. We are not in favour of reducing the commission so that the broker is not sustainable," said Hamal. He also maintained that the policy of distributing 10-unit shares to all possible applicants of the initial public offerings would be revised.

Likewise, Executive Director of the SEBON, Muktinath Shrestha, pointed out that NEPSE index and market capitalisation should be made scientific in a timely manner. He also asked the brokers to submit the proposals for commission and required facilities.

Chairman of Stock Brokers Association of Nepal Dharma Raj Sapkota said that policy support is needed for the recovery in margin trading. Similarly, he said that stability should be maintained in the market by bringing tools like auction market and settlement guarantee fund.

According to him, supply pressure will increase as soon as the lock-in period ends in real sector companies, including Hydropower.

Krishna Giri, Secretary General of Securities Brokers Association, said that the lock-in data of listed companies should be available at the NEPSE. He said that the instruments like treasury bills of the monetary market should be available in the securities market.

Likewise, Ambika Prasad Poudel, executive member of the Federation of Nepalese Chambers of Commerce and Industry and share investor, said that due to the 10-unit share policy of the IPO, number of investors has reached 2.7 million and those who want to go for book building system are now moving towards the premium share price.

Poudel said that the limit of Rs. 120 million is enough for the margin nature of share mortgage loan, but this ceiling is not appropriate for companies that have come to invest in the stock market. 

 Published in The Rising Nepal daily on 17 September 2023.