Kathmandu. In a recent meeting with the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), newly appointed Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel emphasized the government’s commitment to restoring confidence among both the general public and the private sector. Paudel acknowledged the numerous economic challenges facing Nepal but underscored that boosting private sector morale is paramount.
Minister Paudel encouraged business leaders to continue their operations without apprehension, acknowledging the declines in market demand, production, and exports, and assuring that solutions are being pursued. He reiterated the government’s dedication to resolving critical issues, such as the dedicated feeder and trunk line problems and delays in construction contractor payments.
Chandra Prasad Dhakal, President of FNCCI, highlighted the current economic difficulties and stressed the importance of collaboration between the government and private sector to foster economic recovery. Dhakal pointed out the lack of coordination among economic bodies and proposed the establishment of an economic reform commission with private sector participation.
Dhakal urged Minister Paudel to promptly address the feeder and trunk line issues, which have significantly impacted industrial production. He noted that the contraction in the economy has adversely affected employment generation and that, despite official data from Nepal Rastra Bank indicating a 4.17 percent drop in inflation, the actual rate has been around 7 percent since the COVID-19 pandemic. This discrepancy has led to reduced purchasing power and decreased market demand.
Moreover, Dhakal mentioned that although loan interest rates have decreased, industrialists and entrepreneurs remain hesitant to invest, resulting in remittance funds accumulating in banks and financial institutions. He emphasized that low interest rates alone are insufficient to spur investment and called for policy reforms to create a more investment-friendly environment.
Dhakal concluded by urging Minister Paudel to introduce policies aimed at increasing market demand and stimulating economic activities, ultimately fostering a more conducive atmosphere for both established businesses and new entrepreneurs to invest confidently.