'Money laundering provisions have generated unnecessary fear among businesspeople'

KATHMANDU: Business leaders urged the government to create an environment that will boost investor morale, saying policy stability and clearer regulations are needed to expand economic and business activity.

The appeal came at an interaction with the finance minister organised by the Nepal Chamber of Commerce (NCC) on Wednesday on making Nepal more investment‑friendly and addressing contemporary economic issues. Industrialists and businesspeople raised concerns about legal and administrative hurdles that they say are undermining private sector confidence.

At the interaction, NCC President Kamlesh Kumar Agrawal said an investor‑friendly climate is essential to strengthen the national economy. He said cooperation with the private sector is crucial for effective implementation of the budget for upcoming fiscal year 2026/27. He warned that current legal provisions on money laundering have generated unnecessary fear among businesspeople and stressed the need to ensure policy stability and investment security.

"Prior to the implementation of the Money Laundering Act in 2064 BS, there could never be any certified basis (record) from the state mechanism for property legally acquired for centuries through industry, trade, agriculture, and ancestral transfer," Agrawal said. He urged the government to avoid sudden policy changes without prior notice or consultation and cited the automobile sector's difficulties after the halt of public vehicle registration.

Speakers at the programme called for stock market reform, adoption of a single ISIN system, an overhaul of the tax system, increased capital expenditure, and better coordination among regulatory bodies. They also emphasised the need for effective alignment between fiscal and monetary policies.

NCC immediate past president Rajendra Malla recommended legalising cultivation of non‑narcotic cannabis. He questioned the requirement that non‑resident Nepalis present a national ID to invest and suggested a PAN card be required when issuing citizenship. He urged policies that enable proper use of natural resources.

NCC Advisory Council Chairperson and former president Rajesh Kazi Shrestha warned that a country that does not respect the private sector cannot achieve economic prosperity. He criticised attempts to misrepresent the finance minister over the budget and electric vehicle imports, and highlighted problems caused by traffic management, tax provisions, and administrative complexities.

NCC Senior Vice President Deepak Kumar Malhotra and former president Suresh Kumar Basnet reiterated concerns that the Money Laundering Prevention Act and provisions related to organised crime have created an atmosphere of fear among investors. They said excessive taxation on real estate and ancestral property transactions is inappropriate.

Responding at the event, Finance Minister Dr Swarnim Wagle said the government has adopted a strategy to accelerate economic reforms while creating a private sector‑friendly environment. He pledged to work with entrepreneurs to resolve problems arising from past policy and administrative complexities and said the government plans to make the tax system more systematic, expand digital systems, and prioritise investment‑friendly measures.

Minister Wagle added that the government will exempt income up to Rs 1 million from tax, seek to make electricity sector tax provisions end‑consumer‑friendly, and run targeted programmes in education and nutrition through social responsibility initiatives. He said efforts are underway to create a transparent, middleman‑free system and that the government takes private sector concerns seriously.