Traders can only buy up to one kilo of gold at a time, if implemented on a tax-paid basis, traders with high turnover can get more than two kilos.
After the distortion in gold quota and recommendation system, businessmen are advised to give gold based on daily sales or tax paid. The committee formed under the coordination of Rebati Prasad Nepal, head of foreign exchange management department of Nepal Rastra Bank, has given this suggestion to the government. A committee consisting of representatives of Ministry of Commerce and Supply, Ministry of Finance, Bankers Association and Federation of Nepal Industry and Commerce was formed.
"After the increase in corruption, the gold import and sale distribution procedure 2068 had to be revised and made up-to-date. Therefore, a committee was formed under the coordination of Rashtra Bank to study and make suggestions," said a member of the committee. "After studying and discussing, the committee has prepared suggestions to the government. The first priority is to give gold on the basis of daily sales. The committee concluded that providing gold to businessmen on the basis of daily sales would be the most transparent. It is suggested that gold can be given on the basis of taxes to be paid to the government. It has also been asked to remove the system of giving recommendations for
gold purchases. At present, commercial banks are allowed to import only 20 kg of gold per day. Businessmen also get to buy 20 kilos a day. According to gold import and sale distribution procedure 2068, 50 percent of the daily quota (now 10 kg out of 20 kg gold) has been set aside for Bagmati zone of Savik.
In Bagmati, the Nepal Gold and Silver Traders Federation gets to recommend 50 percent of the daily quota. Tejaratna Shakya, a jeweler, said that the remaining 50 percent is only on the recommendation of three organizations (Gems and Jewelry Federation, Handicraft Federation, Nepal Art Professionals Association).
is separated. Among them, Shakya said that 65 percent of gold and silver business federation, 25 percent of gem and jewelry business federation, 7.5 percent of Nepal Art Business Association and 2.5 percent of handiwork federation have the right to recommend. Businessmen say that distortions are increasing in the jewelery sector due to having to refurnish from various organizations.
In the past, a fee of 1000 rupees per kilo was charged for recommending. Now it has increased to 6 thousand rupees. However, Shakya says that the businessman does not get the quota on time. After submitting the sales evidence to the Bankers' Association, the association will recommend one of the banks. Jewelers get gold based on the recommendations of the Bankers' Association," said the member, adding, "The process is the same for distribution in terms of taxes. According to the Rashtra Bank, the foreign currency exchange reserve has been continuously making new records for the past 30 months. As of last January, the country's total foreign exchange reserves have reached 23 trillion 69 billion. Rashtra Bank argues that even if the reserves have increased now, what to do when they decrease. That is the reason why the member is silent on gold import quota.
The committee has submitted a report with recommendations to the Ministry of Industry, Commerce and Supply to improve the condition of the gold market. The ministry has said that it will take further decisions after discussing with the stakeholders (jewellery businessmen). The report submitted by the committee has reached the Minister of Industry Damodar Bhandari. The minister has said that he will revise the procedures after discussing with the jewellers,' Shakya said, 'Based on the suggestions given by the committee, the amendments will be implemented.'
