Lalitpur, June 13: Governor of Nepal
Rastra Bank Dr. Chiranjibi Nepal has said that the government-projected growth
of 8 per cent for the coming fiscal year 2018/19 and inflation of 6.5 per cent
were achievable, and remarked that the Monetary Policy for 2018/19 would have
policies and programmes to achieve the growth and inflation targets.
"The economy is on the right track.
When the country can achieve a 6 to 7 per cent growth rate with poor
electricity supply and infrastructure and political instability, the economy
would board on a higher growth trajectory," said the governor at a
Monetary Policy discussion programme organised by IBN Media and Research.
He said that the country had achieved remarkable
growth in the current and last fiscal year, and it would be sustained in the
year to come.
"In addition to the Rs. 1,315
billion federal budget, there will be additional budget mobilisation by the
provinces and local bodies, which will play an instrumental role to increase
economic activities from the central to the local levels. So, 8 per cent growth
is plausible," said Dr. Nepal.
Chief Executive Officer (CEO) of Sanima
Bank Bhuvan Kumar Dahal suggested the NRB develop a whistleblowing mechanism
for the banking industry in order to minimise discrepancy.
"A banker knows best
about the banks and its dealings. Therefore, promoting whistleblowing in the
industry will help in improving its business and the economy," he said.
He urged the central bank to make its
moves as per BASEL III in terms of maintaining the liquidity ratio.
According to Dahal, as the Cash Reserve
Ratio (CRR) and Statutory Liquidity Ratio (SLR) have been implemented in Nepal,
it would be better to remove the Cash Deposit (CD) ratio.
He also said that the current liquidity
crisis could be addressed by bringing loans from foreign banks and expressed the
hope that the hedging policy that the NRB was currently working on would create
a favourable environment for the same.
Ramesh Maharjan, President of Federation
of Nepal Gold Silver Gem and Jewellery Associations, asked the central bank to
develop a one-door mechanism to facilitate gold import, sell and export
jewellery.
"Gold is an industrial raw material
for us. Therefore, the ceiling on gold import and procurement should be removed
and the private sector should be allowed to import gold. It will create
competition between the banks and traders, which will help the industry,"
he said.
He said that such a mechanism would
increase the predictability of gold consumption.
If facilitated well, jewellery export
could go as high as Rs. 200 billion, he said, and urged the government to lower
the customs on gold. Currently, a 15 per cent customs duty is charged on gold.
Senior Vice-President of Federation of
Handicraft Association of Nepal (FHAN) Kiran Dangol asked the NRB to look into
the interest rate.
Acting President of Nepal Development
Bankers Association Govinda Dhakal said that though the banks have increased the
paid up capital, their haphazard lending might create problems in the future.
He said that the development banks should be allowed to mobilise government
funds.
According to the prevalent policy,
government entities maintain their bank accounts only in class 'A' commercial
banks.
Vice-President of Nepal Chamber of
Commerce Kamlesh Kumar Agrawal said that the NRB had no alternative to
announcing an expansionary monetary policy.
Published in The Rising Nepal daily on 14 June 2018.
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