Mon, May 20, 2024

Govt's policies and programmes aim to strengthen financial sector, boost investment

B360 May 14, 2024, 4:27 pm
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KATHMANDU: The government plans to take necessary steps to address the issues observed in banks and financial institutions (BFIs), microfinance, and cooperatives.

Presenting the government's annual policies and programmes for the fiscal year 2024/25, President Ramchandra Paudel stated that necessary initiatives would be undertaken to resolve the issues observed in the financial sectors.

The President presented the government's policies and programmes at the joint session of both lower and upper houses of the federal parliament today.

The government will adopt a policy to implement legal and policy arrangements, as well as some new arrangements, to address the problems of BFIs. "By strengthening regulation and supervision, the financial sector will be made healthy, competitive, and reliable. The suggestions obtained from the studies conducted at different times will be implemented gradually to solve the problems. Loans of microfinance borrowers will be rescheduled and restructured," it is stated in the government's policies and programmes. "Cooperative organisations will be operated according to the purpose of establishment. The cooperative policy will be updated.”

The policies and programmes mention that a specialised regulatory body will be established for the intensive supervision and regulation of cooperative organisations. Similarly, it is stated that the savings and investments of the cooperative sector will be protected through the Cooperative Savings and Credit Security Fund, Cooperative Credit Information Centre, and Cooperative Debt Recovery Tribunal.

"Arrangements will be made such that cooperative organisations must be affiliated with the cooperative and poverty management information system. Arrangements will be made to merge cooperatives owned by the government. Savings and credit cooperatives will be encouraged to merge," it is stated in the government's annual policies and programmes.

The government has also adopted a policy to boost the morale of industrialists by creating a business-friendly environment within the country. The policies and programmes mention that private investment companies will be encouraged to implement large projects by pooling scattered small capital and operating and managing closed industries.

"Gorakhkali Rubber Industry (GRUL), Butwal Spinning Mills, Hetauda Garment Industry, and other factories, which are competitors of the private sector and closed and defunct public institutions, will be managed and operated through public-private partnership (PPP) or other appropriate models based on feasibility," President Paudel announced while presenting the policies and programmes.

The topic of making revenue distribution equitable, balanced, and predictable is also included in the policies and programmes. Similarly, it is stated that financial transfers will be done based on expenditure needs and revenue capacity.

"Conditional grants will be transferred based on objective criteria. An integrated law will be formulated for the mobilisation and distribution of natural resources, determination of the share of investment and returns, and dispute settlement between the three-tier government. The public finance management will be strengthened by maintaining interconnection between the three levels of electronic systems," it is stated in the government's annual policies and programmes.

It is stated that additional legal and structural arrangements will be implemented to enhance the domestic and foreign investment environment and expand the investment area. The government has adopted a policy of utilising the latest tools for financial development, with supplementary legal provisions to attract private capital.

"Facilitation will be provided to introduce grants and other mixed forms of foreign investment that are globally prevalent. In the forthcoming fiscal year, the country rating of Nepal will be finalised. By implementing an autonomous digital system, the approval process for domestic and foreign investment will be made straightforward, effortless, and predictable," it is stated in the annual policies and programmes.

At the start of today's joint session of both houses of the federal parliament, Prime Minister Pushpa Kamal Dahal presented the policies and programmes to the President. It is customary for the President to present the government's annual policies and programmes in a joint session of both houses of the federal parliament, 15 days before the budget presentation.

Vice President Ram Sahaya Prasad Yadav, Chief Justice Bishowambhar Prasad Shrestha, former Chairperson of the Council of Ministers, Khil Raj Regmi, former Speaker Agni Prasad Sapkota, heads of constitutional bodies, Government Chief Secretary Baikuntha Aryal, Chief of the Army Staff, Prabhuram Sharma, representatives of diplomatic missions in Nepal, civil society leaders, and media sector individuals are in attendance at the meeting as special guests.

Speaker Devraj Ghimire, National Assembly Chairperson Narayana Prasad Dahal, Deputy Speaker Indira Rana, NA Vice-Chairperson Bimala Ghimire, Minister for Law, Justice and Parliamentary Affairs, Padam Giri, among other officials, greeted President Paudel upon his arrival at the Federal Parliament Building in New Baneshwor. A contingent of the Nepali Army accorded a guard of honour to the President on this occasion.

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