Newly appointed Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel has said that the government will focus on building the confidence of not only the general public but also the private sector. In a meeting with a delegation of the Federation of Nepalese Chambers of Commerce and Industry on Wednesday, Minister Paudel mentioned that there are many economic issues that need to be addressed but the most important is to build the confidence of the private sector.
In the meeting with the office bearers of the Federation of Nepalese Chambers of Commerce and Industry, Deputy Prime Minister and Finance Minister Paudel urged the business people to carry on with their businesses without any apprehension. He said he is aware that market demand has gone down along with production and exports but there is a solution to these problems. Minister Paudel reiterated the government’s commitment to address all the issues whether it be the dedicated feeder and trunk line issue or the delay in the payment of the construction contractors.
During the meeting, Chandra Prasad Dhakal, President of the Federation of Nepalese Chambers of Commerce and Industry, mentioned that the economy is facing a problem at present and economic recovery hinges on boosting the morale of the private sector. He added that there needs to be collaboration between the government and private sector to improve the economy.
Dhakal apprised Deputy Prime Minister and Finance Minister Paudel about the lack of coordination among economic bodies at present and that an economic reform commission or any other such mechanism is needed with the participation of the private sector to improve the economy.
Dhakal also urged Minister Paudel to resolve the dedicated feeder and trunk line issue at the earliest. He said that this particular issue has been affecting industries in a major way and manufacturing activities have contracted. Industries have not been able to function according to their capacity, he said.
Dhakal also mentioned that since the economy had contracted it had also hit employment generation in the country. He also stated that data from Nepal Rastra Bank shows that inflation has dropped to 4.17 percent but in reality it has been rising at a rate of 7 percent since the Covid pandemic. As a result, the purchasing power of the people has decreased, he said, adding that this has further resulted in market demand dropping. Dhakal urged Minister Paudel to introduce policies that will help increase market demand so that economic activities also rise.
Dhakal also informed Minister Paudel that though the interest rate on loans has gone down industrialists and entrepreneurs are not willing to make more investments. Hence, the money that has come into the country through remittance has piled up in the banks and financial institutions. He added this shows that low interest rate is not the only incentive for making investments.
Dhakal informed Deputy Prime Minister and Finance Minister Paudel that not only are established businesses not making any investments but even new entrepreneurs are scared to make investments. This is a result of the wrong policies that we adopted in the past, he added, urging Minister Paudel to create an investment friendly environment through policy reforms.
