Directed by the Board of Directors Committee to the Report Implementation Action Plan Committee to implement the report prepared under the coordination of former Deputy Governor of Rashtra Bank Chintamani Sivakoti.
The Nepal Securities Board has started additional work regarding the distribution of licenses for new stock exchanges with private sector investment. The Securities Board Board of Directors has instructed the report implementation action plan committee to implement the report prepared by the committee chaired by Rashtra Bank director and ex-deputy governor Chintamani Sivakoti regarding the license distribution of the new stock exchange.
The Board of Directors meeting held last Thursday decided to give instructions to the said committee to submit the report.
The process for distributing new licenses started when Sher Bahadur Deuba was the Prime Minister and Janardan Sharma was the Finance Minister. The then Chairman of the Board, Ramesh Kumar Hamal, formed a Report Implementation Action Plan Committee under the coordination of Phaninder Gautam, who represented the Securities Board Board of Directors from the Ministry of Law. Currently, Vinod Kumar Bhattarai is representing the Ministry of Law in place of Gautam. The board has appointed Bhattarai, the coordinator of the report implementation action plan committee, and instructed him to submit the action plan.
Hamal, the former chairman of the Securities Board, started the license distribution process by making policy arrangements for the distribution of licenses of private stock exchanges. But the then Prime Minister Pushpa Kamal Dahal ordered to stop the process in 2080 Baisakh after opposition in the parliament saying that the licensing of the stock exchange was rigged. The arguments of the MPs were that it is not appropriate to distribute new licenses to the private sector despite the fact that there is a government stock exchange (NEPSE).
It was the then Prime Minister Dahal's Council of Ministers that instructed to stop the license distribution process and formed a study committee under the coordination of Rashtra Bank director and former deputy governor Sivakoti to study and recommend whether a new stock exchange is needed or not. In the report, the committee suggested that the new stock exchange could be given a license along with the structural reforms of the current stock exchange.
On December 5, the cabinet meeting decided to send the report of the previously formed study committee to the Ministry of Finance regarding the granting of a license for the operation of the securities market. Based on the same decision, in the first week of January, the Ministry of Finance sent a letter to the Nepal Securities Board. On the basis of the same letter, in the second week of January, the Securities Board formally discussed the matter of the new exchange in the Board of Directors for the first time. Although there was only a discussion, the meeting did not take any decision on the matter in the first meeting. The meeting held last Thursday instructed the committee to submit an action plan regarding the implementation of Sivakoti's report.
Earlier, since the government had stopped the process, the Securities Board did not proceed further with the new license of the exchange, saying that Fukuwa should also be released. Now, citing the decision of the Council of Ministers, the board has formally started the discussion regarding the license of the stock exchange after coming from the Ministry of Finance.
Chairman of the main opposition party Maoist Dahal, former finance minister Barshman Pun and others, while speaking in the parliament last week, alleged that there is a large amount of money involved in the distribution of licenses for the new stock exchange. Political parties including RSVP have said that they will protest.
