Entrepreneurs seek cheaper loans
KATHMANDU,JUNE 6:
Entrepreneurs have urged the central bank to make loans cheaper for cottage industries and the agriculture sector in the next budget.
During a pre-budget interaction programme organised by Nepal Rastra Bank (NRB) here today, entrepreneurs asked the central bank to make a provision for interest-free or minimal interest loans to cottage industries to promote its growth. They also suggested simplifying agro loans so that investment in agriculture can be propelled and the sector becomes more professional and scientific.
Participants in the interaction included representatives of the private sector, bankers, entrepreneurs, traders and economists. Microfinance bankers expressed the need for incentives for microfinance institutions to opt for mergers.
They also requested the government to prepare policies that will transfer losses incurred by financial institutions while providing micro finance services in the mountainous region to the government. Likewise, they also suggested the government to tie-up its institutions and organisations active in providing capacity building and training services in rural areas with microfinance institutions.
The central bank was asked to conduct programmes on financial literacy in coordination with the government among the rural populace along with giving them training regarding skills development. In order to utilise incoming remittance, stakeholders suggested about introducing a separate remittance banking system that will channel remittance to productive sectors.
NRB was asked to determine the share of money exchangers in total foreign exchange reserve along with making a provision for keeping foreign currencies earned by money changers at the central bank. In order to promote the housing market in Nepal and provide homes to civil servants, the government was requested to frame policies to provide them with apartments at a concessional rate.
Likewise, the participants expressed the need for reducing interest rates for loans floated to tea and coffee plantation and processing firms to promote the sector that has high potential for exports. Similarly, tourism entrepreneurs and hoteliers also asked for tax concessions to cope with the high the cost of running businesses due to loan shedding and high wage rates.
Governor Dr Yubaraj Khatiwada assured that NRB will take up the issue with the ministry and the committees that NRB is involved with.
Double digit growth?
Caretaker finance minister Barshaman Pun asked banks and financial institutions to prepare the base for double digit growth. Addressing the anniversary of NIDC Development Bank here in the valley on Tuesday, he also claimed that the government is planning to bring a budget that will support double digit growth. “Political changes can only be institutionalised on the basis of economic growth,” he said, stressing on the need for economic prosperity for peace and stability in the country. The caretaker government is preparing the budget for fiscal year 2012-13 but due to the absence of a parliament, it might have to be brought through ordinance.
