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Chandra Prasad Dhakal, President of the Federation of Nepal Chamber of Commerce and Industry, has said that the increase in the informal sector has not resulted in an increase in production and revenue. In the program on 'Progress and importance of formalization in the context of Nepal' organized by the federation in Kathmandu, he said that if the informal sector is formalized, the competitiveness will also increase.
"Increasing the informal sector has not led to an increase in production and revenue." After our informal sector becomes formalized, competitiveness will also increase," said Dhakal, "but many businesses do not want to come under the scope of regulation because the business registration process in Nepal is complicated and expensive." In the
program, Joint Secretary of the Ministry of Labour, Employment and Social Security, Pradeep Kumar Koirala said that informal sector workers could not be brought under the scope of social security fund and domestic workers could not be formalized. But since the employer of informal sector workers cannot be identified, they have not been formalized, he said.
Former Secretary Mahesh Dahal said that the informal economy of developing and underdeveloped countries is a problem. "Informal sector contributes 39 percent to the gross domestic product," he said, "while 7.1 million people are employed, 6 million are in the informal sector."
International Labor Organization (ILO) National Program Coordinator Saurabh Shah said that there are more women in the informal sector. "Some incentives should be given to formalize the informal sector," he said.
The government has been giving special emphasis through periodical plans and policies and programs to ensure the right of social security while gradually transforming the labor of the informal sector into the formal sector. Likewise, a national strategy has been formulated and implemented to formalize workers working in the informal sector. But the results of these efforts have not been seen as expected. According to a study by Tribhuvan University, about 42 percent of the economy is in the informal sector.
As an effort to formalize workers in the informal sector, the National Formalization Program is currently underway. The International Labor Organization (ILO) is also supporting this program, which is progressing with the cooperation of the government and the private sector in order to completely convert the labor market of Nepal into a formal sector.
