RSP Chair Lamichhane urges private sector not to panic

Government seeks partnership with businesses while maintaining strict oversight on activities that could harm the economy

 

Kathmandu, May 3

Rastriya Swatantra Party (RSP) Chairperson Rabi Lamichhane has urged businesspeople not to be gripped by fear or anxiety.

Speaking at a meeting with representatives of the private sector in Lalitpur on Sunday, he said that the government’s objective is not to discourage the private sector but to pursue policy reforms to achieve long-term impact on the economy.

Chair Lamichhane called on the private sector to support the government’s good governance campaign, and said that the government intends to move forward in partnership with business communities.

However, he noted that the state will maintain strict oversight over activities that could weaken the economy. Referring to past instances where political instability and circumstances forced businesspeople under pressure from various power centres, he said, “The government has taken lessons from such experiences and assured that such a situation will not be repeated.”

Likewise, he also urged the business community not to worry the slightest. “As we push forward the good governance agenda at a rapid pace, some questions may have arisen—please take them in stride. The government has no intention of undermining any business,” he said.

According to him, the government wants to move towards a new departure in good governance and economic growth. “There may be some discomfort in this process. I chose to sit down with you precisely because the private sector appeared uncertain and somewhat fearful. There is no reason for you to be afraid or anxious,” said Lamichhane.

However, the government has had to act firmly because certain individuals and actors had begun to move in a way that effectively placed the country’s economy under their control, he said. The state must intervene in time, and that is what the government is doing at present.

Chair Lamichhane added that the state must act firmly against institutional irregularities that could severely damage the economy. “We understand that in the past, due to political instability, you may have been compelled to knock on the doors of political leaders and compromise certain norms and values,” Lamichhane said. “Now, you can be assured that no businessperson needs to run to my home or party office. Policies themselves will provide you with protection.”

He said that the current government will operate based on the commitments made to the public during the election. He also advised business leaders to assess their own shortcomings, conduct internal audits, and work with the state to correct past mistakes.

 

Crucial role of private sector

Emphasising that policy reform, good governance and economic improvement are the government’s primary goals, Lamichane said the role of the private sector will be crucial in transforming Nepal into a middle-income country within the next five to seven years. He called on businesses to operate with confidence, assuring that the government is committed to creating an investment-friendly environment.

Meanwhile, Chair Lamichhane said they are grappling with whether to remain import-oriented or shift towards a production-based economy.

“Your interest in reviving ailing industries is commendable, and we are positive about it. The government is also supportive of enabling the private sector to operate and expand. Out of every ten people, perhaps one or two may be employed by the state, but it is the private sector that employs the remaining eight,” he said.

According to him, the government cannot allow loss-making companies (particularly from the hydropower sector) to issue IPOs and risk the public’s money. The government is clear on this.

Likewise, the government is open to reducing the threshold for income tax. It is not reasonable for individuals to be required to pay up to 50 per cent of their income in tax, and we are prepared to undertake reforms, he said.

Lamichhane also assured the business community that the government is ready to protect the private sector, producers, industrialists and businesspeople alike.

 

Private sector needs confidence boost

Speaking at the programme, President of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) Chandra Prasad Dhakal said that the private sector is a sphere of stability and should be allowed to operate smoothly. However, it has repeatedly come under attack during various movements and has often been the primary target.

“This should not be the case, and we strongly object to such practices. Likewise, the attempt to bring the private sector under the ambit of anti-money laundering measures is a matter of concern,” he said.

Pointing to Bangladesh’s deferral from the LDC, Dhakal said that in light of various implications and potential impacts, perhaps Nepal should consider waiting for some time. Bangladesh was graduating to a developing country in November, along with Nepal. But citing the youth movement and economic crisis, it sought a deferral, which is accepted by the United Nations.

President of the Confederation of Nepalese Industries (CNI) Birendra Raj Pandey said that at a time when capital formation has declined, there is a need to provide incentives and boost confidence.

“Greater focus is required on domestic production, consumption and employment. With the budget season underway, the government needs to pay close attention to these issues,” he said.

Likewise, Acting President of Nepal Chamber of Commerce (NCC) Deepak Malhotra said that there are high expectations from the RSP-led government with a clear majority; it must play an active role in development and economic reform.

“To bring roughly 40 per cent of the economy that remains in the informal sector into the formal fold, it is necessary to reduce customs duties, excise duties and land revenue taxes,” he said.  

 

‘Overregulation is felt’

Former President of CNI Hari Bhakta Sharma said that businesses have felt that there is excessive overregulation.

According to him, the economy has long been import- and customs-revenue-driven, and has operated in this manner for over a century. “We need clarity on whether we will continue with an import-oriented model or shift towards a production-based economy, and proceed accordingly with a clear direction,” he said.

Stating that a critical departure is necessary, Sharma said that it is not feasible for a single sector alone to drive production. The country should advance simultaneously in four key sectors—agriculture, tourism, light engineering and biopharmaceuticals—with focused attention.

He pointed to a need to review laws that allow for the detention of businesspeople before due hearing.

“The private sector is the engine of development. At present, business confidence has declined. The practice of detaining first and hearing later is flawed, our demand is for a policy that prioritises hearing first and taking action thereafter,” said Sharma. 

Published in The Rising Nepal daily on 4 May 2026.