Industrialists, bankers put forward budget wish listIndustrialists and bankers on Monday urged the government to bring programmes to boost agriculture and small and medium industries and promote exports through its budget for 2018-19.
Industrialists and bankers on Monday urged the government to bring programmes to boost agriculture and small and medium industries and promote exports through its budget for 2018-19. The farm sector accounts for 27 percent of the country’s gross domestic product. Similarly, small and medium industries create a large number of jobs in the country. Although the government has been giving priority to these sectors in the past, its efforts have failed to yield the desired results.
Speaking at a pre-budget discussion organised by Nepal Rastra Bank (NRB), Executive Director Nara Bahadur Thapa said that achieving desirable growth in agriculture has been a challenging task for the government. “The budget needs to introduce new programmes to increase employment opportunities by promoting small and medium industries in particular,” Thapa said.
Most of the participants pointed to the need for the central bank to intervene to maintain stability in interest rates as they have been fluctuating widely in the past few years. They also asked that the threshold on refinancing facility be increased. NRB is supposed to address these issues through the monetary policy.
Shekhar Golchha, senior vice-president of the Federation of Nepalese Chambers of Commerce and Industry, said fluctuating interest rates had led to unpredictability in the business world. Golchha also urged the government to introduce a special package for the promotion of small and medium enterprises.
“Reducing transit costs, developing infrastructure, retaining capable manpower in the country and reviewing the challenges that the country has been facing after joining the World Trade Organisation are among the issues which the government should address through the budget.”
Likewise, Rewat Bahadur Karki, chairman of the Securities Board of Nepal (Sebon), urged the government to facilitate the launch of new credit instruments to boost the country’s capital market. “As the country has entered a federal system, the initiative could help ease the dearth of capital,” Karki said.
Former National Planning Commission member Govinda Nepal said that the government should ensure that farmers have timely access to adequate agricultural inputs such as seeds and fertilisers.
He stressed the need to ensure easy availability of funds and increase market access for small and medium enterprises besides developing a mechanism to include their products in the international value chain.
Durga Bikram Thapa, president of the Nepal Pashmina Industries Association, urged the government to slash the import duty on raw materials to 1 percent from the existing 5 percent. The cash incentive should be increased to at least 10 percent from the existing 2 percent and the cumbersome process to claim the money should be simplified, he said.
Likewise, bankers stressed the need for timely disbursement of the capital expenditure budget to resolve liquidity problems seen in the banking sector. Increasing the refinancing amount by at least Rs100 billion and waiving taxes on the bond market and long-term loans and deposits are among the priorities of bankers.
Gyanendra Prasad Dhungana, president of the Nepal Bankers’ Association, said that there was a need to address the asset-liability mismatch in the financial sector with regard to long-term funding. “The problem can be solved to a large extent if the government waives taxes on long-term financing,” Dhungana said.