Sunday, March 31, 2019

Investment Summit concludes, Investors apply for 17 projects


Kathmandu, Mar. 30
Nepal Investment Summit 2019 concluded Saturday with applications for 17 projects in five different sectors – transport, energy, agriculture, education and health and logistics infrastructure.

The government has set April 20 as deadline for investors to apply for their choice of projects among the 77 ventures showcased at the mega convergence.

Coordinator of the event and Finance Minister Dr. Yuba Raj Khatiwada said that the interest shown by the investors within the summit period was very encouraging.

Likewise, 16 Memorandum of Understandings (MoUs) were signed among various domestic and foreign investors, multilateral donors, State governments and the Office of the Investment Board.

Prime Minister KP Sharma Oli and the ministers held about 36 bilateral meetings with the investors and delegates from different agencies, and there were also more than 39 business-to-government meetings and more than 30 business-to-business meetings.  

The summit also featured a number of side-line events on business climate, features of venture capital in Nepal, women in entrepreneurship and a roundtable meeting on 'making investment happen in Nepal'.

"These meetings were extremely useful to carry forward our investment agenda, and the thematic and plenary sessions were highly effective in showcasing Nepal as an attractive investment destination," said FM Dr. Khatiwada.

According to him, the country has been able to demonstrate national unity for the journey of economic prosperity irrespective of different party ideologies to begin a journey towards prosperity hand-in hand with private sector.

While we recognise the private sector as the engine for growth, this summit is an indication of our common bond to proceed together towards this, he said.

Dr. Khatiwada said that the government would make sure that the investors get the best sectors for investment, the best people to collaborate with, the best destination to expand business and the best rate of returns on investment.

"The government would like to provide you with best and professional facilitation to do business in Nepal. We have created and further strengthened the Investment Board of Nepal to provide such facilities at a single stop," stated the minister. "We have created a level playing field for all investors, and we would like to see a healthy competition among them," he added.

He also reiterated that the government wanted to partner with private sector in order to meet the goal of rapid development and economic prosperity.

"The summit has come to a successful end with overwhelming participation of more than 1200 persons,  including above 700 foreign delegates from 40 countries representing more than 300 companies," said Maha Prasad Adhikari, Chief Executive Office of the Investment Board.

"Potential investors were briefed about domestic as well as cross-border and global markets for Nepali products and services. Similarly, the interested investors have been made aware of incentives and policy reforms that Nepal has undertaken to create conducive investment environment for foreign investment," he said.

National and international private sector representatives said that they found the event as an excellent opportunity to complement each other in their business ventures.

President and CEO of Skypower, a Canadian firm that is interested to invest in 600 megawatt solar project in Nepal, said that he found the country ready for the growth with the private sector and FDI friendly policies.

Chairman of Chaudhary Group Binod Chaudhary urged the government to put sincere efforts to implement the policy reforms, improve the investment climate and to pursue the commitments made by the foreign investors.


Published in The Rising Nepal daily on 31 March 2019. 

Reforms to continue to attract investment, says Prachanda


Kathmandu, Mar. 30: Chairman of the ruling Nepal Communist Party (NCP) and former Prime Minister Pushpa Kamal Dahal 'Prachanda' has assured the investors that the reforms initiated by the government would be continued to make Nepal as an attractive investment destination and ensure the fair rate of return on their investment.

Addressing the concluding session of the Nepal Investment Summit 2019 on Saturday, he emphasised that the policy reforms were intended to create business-friendly environment and to ensure predictability of investment related decision.

"Reform is a dynamic process that demands periodic review and updates as per the changes that would occur internally and externally in a due course of time," he said.

Mentioning that development of infrastructure was Nepal's topmost priority, Prachanda said that the government was ready to facilitate the development of economic zones, industrial parks and special economic zones for creating conducive environment for manufacturing and innovation related industries.

"Connecting neighbouring countries by efficient transport means such as cross-border railways, highways, airways, information ways, and power transmissions, are equally important projects that we need to develop to connect Nepali economy to outside and to make our economy competitive," he said.

He said that the investment decision was not an event, but it was a long-term commitment, therefore, rational investment decision demanded political stability and consistent policy for a reasonable period of time.

"I am informed that the government authorities have assured you to give continuity on their efforts of making investment friendly environment," said Prachanda.

Published in The Rising Nepal daily on 31 March 2019. 

Saturday, March 30, 2019

Govt makes significant reforms in energy sector: Minister Pun


Kathmandu, Mar 29: Minister for Energy, Water Resources and Irrigation Barshaman Pun 'Ananta' said that the government had been devising various mechanisms to manage the risks and problems perceived and problems faced by the energy-sector players.

"Over the past couple of years, we have accelerated the pace of reforms in the sector. We have successfully unbundled the sole public utility in the sector and created Generation Company and Transmission Grid Company. Seven distribution companies are now being planned in the provinces," he said while addressing a plenary at the Nepal Investment Summit 2019 that started on Friday here.
He said that, over the past couple of years, the government had accelerated the pace of reforms in the energy-sector.

"Legal instruments are already in place for the formation of a regulator in the sector, and the Electricity Regulation Commission will become functional very soon," said Minister Pun.

In the next five years, the ministry intends to provide access to every household in the country through a mix of grid and off-grid systems. It also aims at generating 10,000 megawatt electricity for domestic consumption along, with another five thousand megawatt for cross-border trading.
"These targets can only be met with the involvement of and investments from the private sector, a good part of that is expected to be of foreign origin," said Minister Pun.

He also said that the government was interested on promoting the Public-Private Partnership model in various forms, and has announced 'People's Hydropower Programme' to develop significant number of projects with a modality that ensures public participation.

"As we are offering attractive power purchase rates for peaking power, proponents willing to invest in peaking run-of-river or reservoir projects must find good prospect for return on their investments," he said.

Executive Chairman of Hydro Solutions Gyanendra Lal Pradhan said that Nepal is a country with lots of potential untapped.

"We are trying to find the replacement of petroleum oil and gas, the domestic market is growing, agreements have been signed for the cross-border energy exchange, Bangladesh wants to buy about 9,000 mw from Nepal and idea of energy banking is being materialised by 2020. All these progresses create a sound market for energy investments in Nepal," he said.

Secretary of Central Electricity Regulatory Commission (CERC) India Sanoj Kumar Jha said that the growing demand of electricity in India has created prospects for energy development in Nepal.

General Manager of Power China Song Dongsheng said that China was ready to export its capacity and technology to Nepal to support the latter in energy-sector development.

"We want to support Nepal with this supply-side capacity," he said.

Member of National Planning Commission Dr. Krishna Prasad Oli said that the government had come up with 25 years strategy in electricity development.

Executive Director of the Nepal Electricity Authority Kulman Ghishing said that the power sector regulator would play its role as a facilitator of investment in energy projects.

Senior Divisional Engineer at the Ministry Sagar Raj Gautam said that the government would offer any model favourable for the investors in hydropower development.

Increasing job opportunities: Minister Yadav

Minister for Industry Commerce and Supply Matrika Prasad Yadav said that the government aimed at increasing job opportunities through industrial development.

"The government is ready to protect the intellectual property and trademarks. We want to be a part of the global market," he said.

He said that the country needed the Foreign Direct Investment (FDI) to meet the economic, social and industrial growth target.

Minister Yadav assured the foreign and domestic investors that he and the Ministry would be available to them to facilitate them in their investment and business initiatives.

Vice-President of the Federation of Nepalese Chambers of Commerce and Industries Shekhar Golchha said that the government has made significant policy reforms but challenges are still there for their implementation.

"One of the major challenges is transport infrastructure. But, its an opportunity as well," he said.
Vice-President of Huaxin Cement Xu Gang said that the money and technical knowhow brought in by the foreign investors can help to enhance the capacity of the country.

Secretary of the Ministry of Industry, Commerce and Supplies Yam Kumari Khatiwada had presented a paper on the investment prospects in the industrial sector in Nepal. She said that the one-door system, newly announced incentives such as concession in income tax, customs duty and Value Added Tax, and facilities at the Special Economic Zones would have positive impact on the domestic as well as foreign investors.

Managing Director of Surya Nepal Abhimanyu Poddar urged the foreign investors to have patience since the Nepali market was profitable in the long term.

Likewise, Managing Director of the Panchakanya Group Pradeep Kumar Shrestha appreciated the recent efforts of the government in creating favourable investment climate and ease the doing business.  


Published in The Rising Nepal daily on 30 March 2019. 

Nepal Investment Summit kicks off


Nepal is a virgin land for investment: PM Oli  

Kathmandu, Mar. 29: 
 The government and the main opposition stood together to welcome the foreign investors at the Nepal Investment Summit 2019 that kicked off in capital on Friday.

They echoed the same voice for the protection of investment and creation of business-friendly environment in the country.

 Prime Minister KP Sharma Oli said that the government would continue to put endeavour to create better investment climate while the Central Committee member of the Nepali Congress, the main opposition party in the parliament, and former Finance Minister Dr. Ram Sharan Mahat, on behalf of his party, extended full support in attracting the Foreign Direct Investment (FDI).

The 2-day summit is being organised by the Office of the Investment Board with the support of concerned ministries and private sector organisations.

The government aims to introduce Nepal as a promising land of opportunities for private investors, to apprise of major policy, procedural and structural reforms made recently to make the country as an attractive investment destination, showcase potential investment projects and to make negotiations between the interested investors for the viable projects.

It is showcasing 77 projects, including 27 from private sector, of about 60 billion US$ at the summit, attended by more than 600 foreign investors and delegates from 40 countries.

Prime Minister Oli said that Nepal was almost a virgin land for investment, and investment in every sector in every field is profitable.

"This summit has brought us together for a genuine cause: consolidating friendship and fostering partnership for our mutual benefit. Through this partnership, Nepal will get the desired development outcomes with your substantial investment with good return," he said.

Stating that political stability, which is a key prerequisite to country's economic growth, was absolutely fulfilled now, PM Oli assured the foreign investors attending the summit that the country has now policy consistency along with political stability.

 "Legal, institutional and procedural reforms, which were long overdue, have gained speed under my leadership. We have drafted many new laws translating the provisions of the new Constitution into legal and institutional framework. The new frameworks have also created conducive environment for foreign direct investment, among others," he said.

According to the PM, the central task before the government was to undertake rapid economic transformation.

"If we could successfully steer country's historic political transformation, we can do the same in economic realm as well," he said.

He stated that the current government was mindful that investment required transparent and responsive governance and rule of law. 

He also said that in the past few months the government had made substantial progress in improving investment climate in the country and established a sound regulatory framework with the enactment of two key legislations – Foreign Investment and Technology Transfer Act (FITTA) and Public-Private Partnership and Investment Act (PPPIA).
"The PPPI Act provides one stop service for any foreign investment of over Rs. 6 billion or a hydropower project over 200 MW capacity. The new FITTA ensures national treatment for any foreign investment," said the PM.

Stating that the government has started online registration and payment system, he informed that the country would actively pursue bilateral investment protection agreement with friendly countries that would further ensure protection of foreign investment.

"We will also pursue negotiations on avoidance of double taxation with interested countries to provide further incentives. The next reform cycle would involve policies and comprehensive legislation in the field of intellectual property rights," said PM Oli.

The PM also tried to allure the investors by inviting them to get huge demographic dividend as the country has about 57 per cent population of working age, and there was a competitive and low labour cost.

He counted on round the clock electricity supply, increasing road connections, cross-border connectivity, strategic locations between the world's two largest markets, compelling incentive for investment and preferential treatment in many development countries, to present the competitive advantage of the country.

Dr. Mahat extended full support to the investors and urged the investors to invest with full confidence.

"Nepal has several areas of comparative and competitive advantage. It has hardworking people, natural resource endowment, energy potential, increased purchasing power and better market opportunities in the region and beyond," he said. "We can be a small market but our two neighbours are the fastest growing economic powers. We want to attract investment with these huge markets in mind, taking advantage of our resources and human resources," he added.

According to him, Nepal has high FDI prospects as it has been receiving FDI about 0.4 per of the Gross Domestic Product (GDP) which is much lower than its neighbours which are receiving FDI of about 2 per cent of the GDP.

"We need a huge investment to lead the country in the path of the economic growth. But as the domestic investment is not sufficient for accelerating the growth, Nepal needs more FDI," said Dr. Mahat.

Minister for Finance Dr. Yuba Raj Khatiwada said that while encouraging investment in several areas of private sector attraction, the government was coming forward to work hand in hand with the private sector in different models of PPP.

"The tax system is transparent and predictable; corporate tax rates are competitive; foreign exchange regime is liberal; and pegged exchange rate regime provides a cushion to foreign exchange market volatility," he said.

The Finance Minister also said that the government was focusing on forward looking macroeconomic and sectoral reforms, also with the support of the development partners.

Several regulatory and operational reforms in the areas such as industry, energy, forest and land management, environment, airlines industry, financial services, public procurement, and labour market have already been undertaken in the last one year, he said.

Vice-President of the World Bank Hartwig Schafer extended full support to Nepal in pursuing its development agenda and said that the prospects of the present government in executing its visions were good.

He recommended to make the civil servants capable and smart as the facilitator.
"Give projects to the private sector if it can do it. If any financial technical support is needed, the WB is ready to offer. We stand ready to provide support to Nepal," he said.

Vice-President of the Asian Development Bank Shixin Chen said that there was high prospect in infrastructure development in water supply and sanitation, energy, transport and telecommunication.

Union Minister for Investment and Foreign Economic Relations of Myanmar U Thaung Tun said that the countries like Nepal and Myanmar needed responsible investors, those eying for long-term profitability.

Minister for Foreign Affairs Pradeep Kumar Gyawali said that investment related laws were created or amended to provide better investment services.


Published in The Rising Nepal daily on 30 March 2019. 

Nepal Investment Summit today


Kathmandu, Mar. 28:
The Nepal Investment Summit 2019 will be inaugurated by Prime Minister KP Sharma Oli on Friday in the capital.
To tell the world that Nepal is the best investment destinations and promote its investment-friendly policies in various sectors with an aim of attracting investment in large infrastructure and business projects, the Investment Board of Nepal (IBN) is organising the summit with the support from the concerned ministries and private sector.
The IBN will showcase 77 projects, ranging from Rs 640 million to Rs. 350 billion, of seven different sectors for investment. The government has given priority to physical infrastructure, energy, tourism, agriculture, information technology, industry, health and education sectors. The Private sector is proposing 27 of the projects at the summit
More than 600 investors from 40 countries will attend the mega-event that aims at obtaining the investment commitment of about Rs. 3 trillion, an amount equal to the country’s Gross Domestic Product (GDP). The highest number of delegates, 265 investors and other representatives, will come from China.
The country desperately needs massive investment in infrastructure projects in order to meet the high growth trajectory needed to be a middle-income nation by 2030. It needs about Rs. 900 billion infrastructure investment everywhere while its annual infrastructure budget is below Rs. 400 billion.
Similarly, the country will welcome 120 business delegates from India, 21 from Japan, 19 from Myanmar, 17 from South Korea, 13 from Omann, 12 each from United Arab Emirates and Malaysia, 10 each from Canada, Sri Lanka and the United States of America, nine each from Germany and the United Kingdom and 79 from other countries.
Likewise, high-level government officials, representatives of Kathmandu-based diplomatic missions, development partners, Nepali private sector and Non-Resident Nepalis will participate in the two-day conference.
According to IBN Chief Executive Officer Maha Prasad Adhikari, this summit would be different from those held in the past as it will try to not only offer the projects but also offer insights in the country’s plans, initiatives for long-term development and policy reforms made to enhance the doing business environment.
With an aim of strengthening investment climate and attract more foreign and domestic investment, the government has enacted Public Private Partnership and Investment Act, Foreign Investment and Transfer of Technology Act, Labour Act, Company Act, Industrial Enterprise Act, Special Economic Zone Act and amended many other laws related to business, infrastructure development, Environment Impact Assessment and business registration.
The IBN has said that it had received many positive responses from the foreign investors.
Meanwhile, the World Bank Group has said that its investment risk insurance arm – Multilateral Investment Guarantee Agency (MIGA) was actively seeking opportunities to support foreign private sector investment into Nepal.
The WB currently supports 25 active projects in the country with 2.6 billion US$.
“Nepal has been a rising star in South Asia with foreign direct investment flows reaching a record high in 2017, and likely to remain an important investment destination in the region. This confirms Nepal’s efforts to improve its investment climate and become a competitive investment destination for multinational companies that want to have an impact,” said Keiko Honda, Executive Vice-President and CEO of MIGA.
Along with Honda, Vice-President of WB South Asia Hartwig Schafer and VP of International Finance Corporation Hans Peter Lankesh will attend the summit and will discuss bank’s support for Npeal with PM Oli and Finance Minister Dr. Yuba Raj Khatiwada.
Likewise, Union Minister for Investment and Foreign Economic Relations of Myanmar U Thaung  Tun, Vice President of Asian Development Bank  Shixin Chen, Vice-president of Asian Infrastructure Investment Bank Dong Lee and high level representatives of the world renowned companies are attending the summit. 
 Published in The Rising Nepal daily on 29 March 2019. 

Reforms Underway To Lure Investors


 It won’t be an overstatement to say that Nepal holds unique investment and business potential when compared to its neighbours and global peers. However, it has been unable to perform well in terms of attracting Foreign Direct Investment (FDI) while some of the large-scale manufacturing industries in the country failed to prosper with a few meeting untimely death.
The country has so far failed to capitalise on its advantages of having one of the world's largest market access across the border in the south – two Indian states Bihar and Uttar Pradesh have 350 million people.
It has the facility of duty-free entry of hundreds of products to China, India and European Union and enjoys the Generalised System of Preference (GSP) in the market of the United States of America. Being a Least Developed Country (LDC), it also enjoys other trade facilities as well.
Nepal also, probably, has the finest FDI case studies like Unilever, Dabur Nepal, Surya Nepal, Ncell and Standard Chartered. For Dabur and Unilever, Nepal is one of the best markets globally.
At the same time, the purchasing power capacity of Nepali people improved significantly which created a base for the supply of luxury goods like vehicles, electronics, branded clothes and other facilities. With about 30 million people, the country itself is a market to reckon with.
Still the country has been unable to receive desired amount of foreign investment. The prolonged political instability which contributed to policy uncertainty, decade long armed conflict followed by prolonged transition, and energy crisis resulted in investors shying away from Nepal.
In order to change the investment rhetoric, in 2017 the government organised Nepal Investment Summit which was able to draw the investment commitment of about 14 billion US dollars, one third of which is in the phase of realisation, according to the Investment Board of Nepal (IBN).
With the implementation of the federal constitution three and a half years back and a government with two-thirds majority in place, Nepal began to draw the interest of foreign as well as domestic investors. To build an investment climate and increase the confidence of the investors, the government has made some major legal reforms in the last few years. Endorsement of the Public Private Partnership and Investment Act, Foreign Investment and Technology Transfer Act, Industrial Enterprise Act, Company Act and Labour Act is an effort to attract more investors to the priority areas like agriculture, information technology, tourism, infrastructure and energy. 

 Public Private Partnership and Investment Act, 2019
Recently formulated PPP and Investment Act sets the way for the formation of an autonomous body to facilitate mega infrastructure projects with FDI, and separate units of PPP and Investment. The IBN is mandated to deal with the investment of over US$ 5.2 million and hydropower projects of over 200 megawatt installed capacity.

Foreign Investment and Technology Transfer Act, 2019
The FITTA has revised the definition of 'foreign investment' and included lease financing and investment in listed securities in secondary market. Foreign investment can be made individually or collectively or by opening a branch office or establishing a venture capital fund and contract manufacturing. It has also paved the way for one-window service to the investors and reduced the negative list.

Company Act 2017
The Company Act has robust mechanism to protect trademarks that refuses to register any company with a name that is identical to a registered trademark. According to the act, a public company can hold 100 percent shares of private company and vice-versa without conversion. A Nepali citizen can be appointed as an agent or authorised representative by a foreign company at its liaison or branch office in Nepal. It also has the provision to buy back its own shares to protect itself from any hostile overtake or to remove uneconomic units of shares.

Labour Act 2017
Labour Act gives flexibility in hiring for different terms as per the employer’s requirements and adopts 'No work, no pay' principle. It has simplified the provision for work permit to foreign nationals in executive and other positions. This law has mandatory provisions of employment contracts for all types of employment, and sets minimum wage per month at Rs. 13,450. Employers are required to have accident insurance and health insurance policies for all employees.

Industrial Enterprises Act, 2016
The Industrial Enterprises Act has implemented 'No work, no pay' and restricted illegal strikes. It has classified industries on the basis of size of fixed asset investment and nature of business and allows import of goods from foreign parent company for market development of new goods and employment of foreign nationals in high-level managerial position. 
This Act offers 20 per cent exemption in income tax for manufacturing industries and 40 per cent discounts on income tax for industries with investment in construction of roads, bridges, tunnels, ropeways, railways, trams, trolleybuses, airports, industrial structures and industrial complexes. Similarly, manufacturing industries other than that producing brandy, cider & wine from fruits established in underdeveloped, undeveloped and less developed regions are entitled to 90 percent, 80 percent, and 70 percent exemption respectively on income tax for the first ten years from the date of operation.
Manufacturing industry established with capital investment of at least 1 billion Nepali rupees and providing annual direct employment to more than 5 hundred individuals is entitled to full income tax exemption for the first five years from the date of operation and 50 percent income tax exemption for an additional three years.
Likewise, there is incentive for the generation of energy, excavation and exploration of petroleum or natural gas, tourism industry with fixed capital of over NRs. 2 billion, software development, data processing and digital mapping industry and export-oriented manufacturing industry. Any industry that exports Intellectual Property (IP) created and registered in Nepal is entitled to a 25 percent exemption on royalty income from export of such property.
The Act has exemption facilities and concessions for Value Added Tax (VAT) and customs tariff for the export-oriented industries, import of machinery and other industrial device. It also has a provision to not to levy local taxes including Unified Property Tax on industries operating inside the Industrial Districts (IDs) and additional facilities to industries established inside the Special Economic Zones (SEZs) of IDs.

Special Economic Zone Act, 2016
Private sector is allowed to establish, operate and manage the special economic zone upon obtaining of a license. Based on the nature of the industry, the maximum validity period of the license is 30 years and can be renewed for another 10 years if the industry is utilizing over 30 percent of its capacity. Documentation like preliminary environment examination, economic and commercial viability is not needed to establish an industry in the SEZ. Foreign workers or employees working in the industry shall take 70 percent of its total remuneration in convertible currency outside Nepal instead of 60 percent.
Likewise, industry using up to 60 per­cent of domestic raw materials is entitled to receive 50 percent exemption for the next 10 years while the others will get 50 percent exemption for the next 5 years. Any industry that exports products or services, or sells its products and raw materials to other industries in the SEZ will get zero VAT facility. There are incentives for renting land and importing raw materials.
One-window facility will be established at the SEZ which will include industry registration, approval of foreign investment, company registration, provision of services and facilities as per the SEZ Act, registration of Personal Account Number (PAN), provision of certificate of production, passport processes, and work permit approval. Strikes and protests are strictly prohibited within the SEZ. The government has announced various incentives and concessions for the establishment of industries in the SEZ in hilly and mountain districts.

Environment Protection Act, 1997
Proposed projects cannot be implemented without getting Initial Environmental Examination (IEE) or Environmental Impact Assessment (EIA) approved by concerned body (in case of IEE) or Environment Ministry (in case of EIA).
Final IEE shall be approved by concerned body within 21 days of receipt of complete report. In case of EIA, concerned body shall forward the report to Environment Ministry which shall then approve EIA within 60 days (additional 30 days if required) of receipt of report. Projects must obtain pollution control certificate from the government.
In recent reforms, the government has scrapped the Supplementary EIA guidelines and some of the criteria are relaxed. The criteria regarding change in number of trees for determining the need for SEIA is removed. Similarly, duration of disclosure of SEIA for public comments by Ministry was reduced from 30 days to 15 days.

Hydro Related Laws
The government has unveiled Nepal Electricity Regulatory Commission Act, 2017 that envisions regulatory authority to regulate electricity generation, transmission, distribution and cross-border power trade. It has floated Power Purchase Agreement (PPA) rates of Ron of the River (RoR), Peaking RoR and storage projects, including PPA in dollar currency for foreign investment projects.
The Memorandum of Understanding (MoU) on BIMSTEC Grid Interconnection and with Bangladesh for the cooperation in power sector has created more business potential. A Power Trade Agreement (PTA) signed between Nepal and India in 2014 has promoted government-to-government cooperation on a number of power sector activities including transmission interconnections, grid connectivity, power exchange and trading.
There is income tax holiday for hydro, solar, wind and bio-fuel projects that start production, transmission or distribution within April 12, 2024. Only 1 per cent VAT and customs duty will be charged on import of construction equipment, machineries and raw materials.
Published in The Rising Nepal on 29 March 2019. 

Bank branches reach 711 local levels


Kathmandu, Mar. 27: Banks and financial institutions (BFIs) have established 1080 new branches across the country in the first seven months of the current fiscal year 2018/19.

The number of branches of 157-BFIs by the end of the last fiscal year was 6,651 which increased to 7731 in mid-February this year, said the Nepal Rastra Bank (NRB).

Among the BFIs, microfinance companies established the highest number of branches – they expanded their services through additional 1,115 branches while the finance companies' branches decreased by two in the same period.

Class 'B' institutions (development banks) added 22 branches to make 1,181 while commercial banks added 33 branches.

Meanwhile, of the 753 local levels, 711 have at least a branch of a commercial banks with facilitates of banking transactions as well as government fund transfers in a hassle-free way.

 Of the seven States, Karnali has the highest local levels, 15, without the presence of commercial banks. Likewise, State 1 has eight local levels without the access to the commercial banks, Sudurpaschim six, and Gandaki three local units. Similarly, three, five and two local units in State 2, State 3 and State 5 respectively lack the access to the commercial banks.

Presence of Commercial Banks
State
Number of
Local Units
Local Units with
Bank Branch
Local Units without
Bank Branch
Province 1
137
129
8
Province 2
136
133
3
Province 3
119
114
5
Gandaki
85
82
3
Province 5
109
107
2
Karnali
79
64
15
Sudurpaschim
88
82
6
Total
753
711
42
Source: NRB


Published in The Rising Nepal daily on 28 March 2019. 

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