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काठमाडौंमा वायुको गुणस्तर: १४४

"Private sector investment should be increased in the infrastructure sector"

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From what we hear now, the exterior is very good. Even though the liquidity in the bank was very available, the loans could not be disbursed. The morale of the private sector is very low. Reality is never unreal. Looking at the data, imports have decreased.

The National Bank had to take expanded policies after Covid. The budget also increased. This was the demand of the time. As a result of this, the ratio of loan disbursement was 80 percent of the gross domestic product (GDP) in South Asia. Nepal is still in the situation where it is 110 percent. There is no lack of expansion in our trade. The throat has come. It's just that it didn't come up. Credit is expanding. Now deposits in banks are increasing at around 14 to 15 percent. Loans are increasing by 4 to 5 percent. Why is the rate of credit expansion low when the GDP rate in South Asia is 110 percent.

is already very high. After the earthquake and covid-19, the policy of expansion came. That credit expansion did not go to the productive sector. After the financial crisis of 2008, credit expansion in western countries also increased along with increased financial access. In Nepal, the credit expansion that came after the earthquake and covid went to real estate. The profit from that was also reinvested in real estate. Some went to the financial sector. It went down in the area of ​​production. Now when the policies are being tightened a bit, the non-banking assets due to bad loans are also increasing in the banks due to the inability to recover the loans that went to the real estate and infrastructure sectors.

Therefore, it is natural that there is a relaxation in the expansion of credit loans in a situation where the rate of loans and GDP by banks is already high and the non-banking assets due to credit loans are increasing. Imports have decreased due to some strict policies. Due to some strict policies, our imports have decreased. Nepal Rastra Bank's policies have also played a helpful role in this. Sadly, declining imports is not a bad thing. It seems to have an impact on revenue. Political instability has also become a problem. Policies should be permanent. The problem is that tax rates are based on research and not a long-term industrial strategy.

Now let's hope that the budget will be improved. The industrial and construction sector is not functioning now. But the tourism sector has done well. But we need to think about it. Services are imported to support the tourism sector. This is more than the income from the tourism sector. Therefore, it is important to focus our attention on how to increase the use of domestic products in the tourism sector.

Agriculture, education and health are also good in the field. Therefore, the whole area is not devastated. Some areas have economic laxity while some areas are doing well. We should move forward by supporting the areas that will be better in the future.

If GDP growth continues to be negative for 6 consecutive months, we are in a recession. So technically we are in recession. Industries have also collapsed. It is necessary to go to the productive sector when the credit is made operational. Even if there is a little economic relaxation, the production sector should move towards increasing the gross domestic product. Investment should be made towards strengthening the real sectors of the economy.

The innovation of some things will happen from the private sector. There is no profit without innovative ideas in this field. The private sector is always 10 steps ahead of the policy makers. Therefore, it is the responsibility of the private sector to criticize the government for the need for reform. It was not forgotten that our country went to federalism in 1972. Now our country has three levels of government. We are discussing this before the federal government brings the budget. There are provincial and local governments. The union government will come up with a budget by combining it all. It was also seen that there was no coordination between the union, state and local governments. There is a tendency in all three levels of government to implement plans based on written notes.


There should be a professional role in all three levels of government, the Ministry of Finance, the Nepal Rastra Bank, and the National Planning Commission, which formulate policies. This is not happening yet. Still, depending on what a political person says, the plan will come to all three levels of government. Regarding the revenue of the local level, there is a very big problem of river-borne construction materials.

The local level contracts to extract construction materials. Local level gets 60 percent of its revenue. 40 percent goes to the state government. It was found that there was a lot of politics in it. There is also a problem that needs to be addressed regarding conditional grants. Still, due to the conditional grant, the central government has advanced some smaller plans than the local level. Therefore, it was seen that the issue of how to improve the conditional grant should be thoroughly studied and researched. There is a lot of ambiguity regarding the common and individual rights of the union, state and local governments.

has not yet become the policy rules of the central government. The state is facing the central government and the local government is protecting the state and the central government. It has been seen that laws, policies and regulations to be made to implement (implementation) of the constitution should be made quickly. It was seen that the political instability of the central government has affected the state government as well. There is also a problem of shortage of staff at the state level due to the desire of employees to remain in the union. When the multi-year contracts are increasing, there is no room for new plans and annual plans. Public procurement regulations are also not localized.

It is known from research that all three levels of governments are facing various problems in planning and budgeting due to these various problems. Capital expenditure is mainly in the infrastructure sector. As the capital expenditure is high, it affects various sectors. It is necessary to increase private sector investment in the infrastructure sector. It seems that how to link bank loans to infrastructure should come from budget to monetary policy. The budget should include things that facilitate the private sector rather than restricting it. The budget coming from donor agencies is not being spent now. .

Attention should be paid to how expenses can be increased. It is very important to think about startups and IT sector. Revenue collection is decreasing. There is a situation where we are not using the resources from outside properly. It is necessary to strengthen the economy by mobilizing the infrastructure sector and the Global Fund through the private sector.

प्रकाशित : जेष्ठ ३, २०८१ २१:१७
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