Finance Minister addresses White Paper; National Treasury almost empty

On the representative assembly held on Chaitra 16, 2074, Finance Minister Dr. Yubraj Khatiwada shared insights on few highlights of the White paper published by the Ministry of Finance (MoF). The white paper gives an overview of our country’s current economic status. The major topics he focused on were: Stock market: After the appointment of Dr. Khatiwada as the Finance Minister, the NEPSE index has been continuously falling down. Might be a mere coincidence or some underlying reason. Whatever it may, Dr. Khatiwada proceeded addressing this issue by shedding light into the increasing supply of shares into the market. He mentioned that, when the supply of share increased, the horde of people wanting to sell dominated the number of buyers, which by normal rule of market pushed down the index. In addition to that he also emphasized on the fact that most of the listed companies in our bourse are Banking and Financial Institutions (BFIs). After the liquidity shortage among the BFIs and the drastic increment in the interest rates, the funds got diverted from stock market into the bank vaults, affecting the prices of shares. He also attributed the fluctuations in NEPSE index to the lack of institutional investors in our stock market. Lack of real time and accurate information, long-term vision and insufficient financial literacy among the individual investors has led to further fluctuations in the index. National treasury: Dr. Khatiwada mentioned that our national treasury is almost empty now, putting our economy in a challenging situation. The main cause, as expressed by him, is our tendency to spend now based on what we might receive in the future. Foreign Direct Investment (FDI) has been given paramount importance in the development of our country. However as Dr. Khatiwada mentioned, we haven’t been able to attract that huge an amount. Since we haven’t been able to generate enough revenue to cover our budget deficit, the Treasury has reached its low level. However. According to an article published on Chaitra 13, 2074 on The Himalayan Times the Foreign Investment pledges in Nepal have increased by a whopping 230 percent in the first eight months of the ongoing fiscal year. If these pledges were to materialize, we can expect to get ourselves out of the ditch that our Finance Minister stated.