National capital formation, saving on top priority: Khatiwada

Kathmandu, July 7: Finance Minister Dr.Yubaraj Khatiwada said  on Thursday that the government was focusing on national capital formation and national saving.

If we failed in national capital formation, the country would be relying on foreign loan or grant assistance, he said while speaking at post-budget discussion programme organised by the Confederation of Nepalese Industries (CNI) and Society of Economic Journalists-Nepal (SEJON).

“The country must increase the national saving and invest it in the productive sector. Tax rates are revised so as to prevent them from disturbing the capital formation process,” he said.

According to him, Nepal needs to mobilise foreign money for the development work since internal money is not sufficient.

He also urged the businessmen to bring in more foreign money as investment and financing. 

We are at the point of correcting the course of national economy, the government wants to transform it from the non-productive import-based economy to productive economy in order to create more employment and achieve the sustainable growth.

Addressing the queries of the private sector, the Finance Minister said although the government, through the budget for the coming fiscal year 2018/19, had come up with some protectionist measures in terms of some industries in order to make the country self-reliant in some of basic products, it was a cautious move and the protectionism would not be limitless.

Stating that the government was elected through a democratic process and believed in democratic practices, Dr. Khatiwada said that it would consult with the relevant stakeholders before formulating policies and implementing them.

The Minister said that the private construction companies should increase their capacity. As there is a huge gap of knowledge and technology in development and construction, the government has proposed to establish an Equipment Leasing and Consulting Company to facilitate the government and private sector in the construction of tunnels.

He said tunnels would reduce the road construction cost and have multiple positive impacts on transportation, environment and soil. According to him, the company will be established soon in collaboration with the private sector.

He assured the private sector that its grievances would be addressed and suggestions would be heard.

Responding to a question regarding the small loan amount to the young entrepreneurs, Dr. Khatiwada said that in the beginning about a million rupee is sufficient. When entrepreneurs become more experienced and their businesses take off, they can have the facility of additional financing, he said.

Revenue Secretary Shishir Kumar Dhungana said that the government was mulling over sustainable financing mechanism for the women entrepreneurs and work procedure was being formulated for the same.

He said that the liquor industry should be subjected to more state control and regulation.

President of the CNI Hari Bhakta Sharma said that government should come up with special programmes for the private sector to involve it in the development process.

Businessmen criticised the government for increasing tax rates, including the VAT.

Published in The Rising Nepal on 8 May 2018.