It is suggested to give priority to the payment of completed works without making a new contract in the current fiscal year, and if the budget is available, it is suggested to keep a new project in the next year.
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The High Level Economic Reforms Suggestion Commission, which has been given the responsibility of making suggestions for improving the sluggish economy, submitted its initial report to Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel on Wednesday. The high-level reform commission formed under the chairmanship of former finance secretary Rameshwar Khanal last October made various suggestions to make the sluggish economy more viable and strong.
Since the economy has not been viable for a long time, the private sector has slowed down. At such a time, on the one hand, government finances (revenue collection, capital expenditure, foreign aid and subsidies, etc.) are also weak, and on the other hand, the government has not been able to pay the mandatory obligations such as interest subsidy, insurance fee subsidy, construction business etc.
The report pointed out that when the economy is sluggish, the government should increase spending to make the economy viable and encourage the private sector to invest more.
'Since this is a preliminary report, not many things are covered, although various suggestions are included here on how to make the slack economy run immediately,' said a member of the commission. Desperation is everywhere, it needs to be crushed. The report will address those problems.' According to the Ministry of Finance, in the
report, the issues that need to be done urgently to make the economy more dynamic and strong have been mentioned. In this, the tax administration of Nepal should be made agile and sound, and for that, the double tax system should be removed, and the tax administration should be reduced.
The Commission has suggested that a 'law relating to lending business' should be formulated for the regulation of lending business. In recent years, there has been a trend of business houses borrowing goods from suppliers but not paying them on time. It is seen that it has caused problems in the business, so it seems necessary to regulate the lending business," said a member of the commission. Sources have informed that the Commission has prepared a draft of the "Law on Borrowing Business" to solve this problem.
The Ministry of Finance has stated that making the company registration process easy and single-door, paying liabilities and other outstanding amounts, facilitating real problematic debtors in the financial sector, and creating laws to regulate commercial lending. Addressing the problems seen in the problematic cooperatives in the
report, increasing capital expenditure during the remaining period of the current financial year, expediting the reconstruction of the physical infrastructure damaged by catastrophic events such as the Jajarkot earthquake, expediting the distribution of compensation for land for which the government has taken action for land acquisition or the process has been completed, and through It has been suggested to facilitate the coming Indian tourists.
In recent months, more and more tourists from India are coming to Nepal. The conclusion of the commission is that more tourists can be brought in if Indian tourists can be encouraged due to neighboring countries, open borders, visa not required etc.
It is suggested to give priority to the payment of completed construction works without entering into a new contract in the current fiscal year, and to keep the new project in the next year's budget only if the budget is available by fulfilling the obligations created by entering into multi-year contracts. Based on the effects of subsidies provided by the government in various sectors on production and employment, it is also suggested to review the availability of resources and to review the interest subsidy program for subsidized loans.
Increasing health insurance premiums, giving an opportunity to reschedule loans for one year if the business that was in a good condition before Covid is in trouble now but will improve later, property management company in public private partnership is established in the context of slack real estate market and increasing non-banking assets of banks. The commission recommends issuing the necessary laws. In order to solve the problems seen in the cooperative sector in the
report, make legal arrangements so that the area of operation of savings and credit cooperatives does not exceed the geographical area of a local level, prohibit a company or any organized organization from being a member of a cooperative, and arrange that only natural persons can be members. It has been suggested that a single loan limit be legalized in savings and loan cooperatives like in financial institutions, and that the total loan to a single person from one or more tamsuks should not exceed 10 percent of the total share capital of the investment institution. is.
The Commission has suggested that all projects allocated more than 100 million rupees should be regularly monitored and an authorized team should be mobilized to solve the problems on the spot to increase the capital expenditure during the remaining period of the current financial year.
