If the governor's recommendation process does not go ahead, the Rashtra Bank will be under permanent leadership from March 25, a legal provision to appoint a governor one month before the position becomes vacant.
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Although political consensus has been reached on the appointment of the new governor of Nepal Rastra Bank, the meeting of the recommendation committee chaired by the Minister of Finance has yet to be held. The committee formed on March 11 by the decision of the Cabinet has not held a single meeting after a month has passed. The post of governor is vacant after March 24.
According to the National Bank Act, a new governor must be appointed one month before the vacancy of the governor post.
Before the term of the then Governor Mahaprasad Adhikari ended, the government formed a recommendation committee under the coordination of Deputy Prime Minister and Finance Minister Vishnu Paudel with former Vice Chairman of National Planning Commission Vishwa Paudel and former Governor of Rashtra Bank Vijayanath Bhattarai as members. But since the recommendation process did not go ahead, the government has given permanent responsibility to Deputy Governor Neelam Dhungana since March 25.
There has been a delay in the appointment of the governor due to the disagreement between the ruling Congress and the UML. But the leaders say that Prime Minister KP Sharma Oli and Congress President Sher Bahadur Deuba have agreed on the name of the new governor last Tuesday. But the committee has not received a name. While waiting for the order of the leaders, the recommendation committee has become useless," said an official of the Ministry of Finance.
Executive Director Gunakar Bhatt has resigned before the Permanent Governor Dhungana of Rashtra Bank last Friday. However, the resignation has not been accepted. A writ was filed in the Supreme Court while there was talk of Bhatt being appointed as the governor. On Sunday, the bench of Justices Hariprasad Phuyal and Nityanand Pandey put this writ on the list of not being sent for viewing. Another payment is scheduled for Monday.
A former governor commented that the reputation of Rashtra Bank was tarnished by not meeting the recommendation committee for a month. The recommendation committee will select the best three people and send them to the Council of Ministers. This means that all three are the best, appoint the one whom the government thinks is appropriate,'' he said, 'but a committee was formed to show it here. Not being able to hold a single meeting of the committee is extreme politics. This raised questions about the decision-making capacity of the committee's coordinators and members.' Paudel, an expert member of the recommendation committee, said that the committee coordinator is responsible for calling the meeting. The leadership is responsible for calling the meeting of the committee. "It has not been called yet," he said, "The Deputy Prime Minister and Finance Minister have said that they will call a meeting soon." Bhattarai, another member of the
committee, said that he did not know the reason why the meeting of the committee was not held. "According to the information received from the media, it is said that the meeting was not held because the two parties did not agree," he said, "Since we are members, the meeting will be called by the coordinator. There is no news yet.'
Among the regulatory agencies in Nepal, the National Bank is relatively strong. The coordination between the Ministry of Finance, which formulates and implements the financial policy, and the National Bank, which formulates and implements the monetary policy, has always been questioned. On top of that, since the government is delaying the appointment of the governor, there is a suspicion that there will be some manipulation here as well.
Former governor of Rashtra Bank Chiranjeevi Nepal says that the more the delay in the appointment of the governor, the more negative the impact on the economy. He says that even though the Act gives the recommendation committee the task of choosing the governor, the government interferes in it and chooses it by itself. The government has been making the role of the committee useless. The governor is being made like the director general of a public institution," he says. "The government will appoint the governor from the list of three people made by the committee. But not being able to recommend it is strange .'
Although the role of the governor is important in solving the problems of the economy, economists say that the government is not sensitive in the appointment process. According to them, the most important role of the governor is to get Nepal out of the "grey-list" of FATF, an international organization that monitors money laundering and terrorist activities.
The National Bank Act stipulates that the governor must have a high moral character, have work experience in economics, monetary, banking, finance, commerce, management, public administration, statistics, mathematics or law and have a master's degree.
