KATHMANDU, Sept 4: The government has announced a revival package for entrepreneurs affected by the devastating Bhotekoshi floods, offering customs duty waivers, concessional loans, and debt restructuring facilities. The measures, endorsed by the Cabinet on Thursday following a proposal from the Ministry of Finance (MoF), are aimed at easing the financial burden on businesses and supporting long-term recovery.
According to the MoF, commercial and transport vehicles damaged beyond repair or swept away by the floods will have their registrations cancelled. Entrepreneurs re-importing replacement vehicles will be granted full duty exemption at customs points.
The same provision applies to plants, machinery, devices, and equipment destroyed in the disaster. Duty exemptions will be available for imports of replacement assets, provided their value does not exceed that of the damaged items.
Dashain aayo (again)
Special arrangements have also been made for goods cleared earlier at the Rasuwa Customs Office but destroyed before reaching their destination during the August 26 floods. Importers of similar goods within six months will be allowed to adjust previously paid duties, ensuring businesses are not penalized twice for losses caused by natural calamities.
The Cabinet has introduced a one-year concessional loan facility for all borrowers affected by the floods. Interest rates will be capped at the bank’s base rate plus a 0.5 percentage point premium, or the existing premium rate, whichever is lower.
Borrowers will be allowed to restructure or reschedule loans once, extending repayment deadlines for both principal and interest. This measure is expected to benefit industrialists, traders, and small business owners whose income streams have been disrupted but who remain liable for regular installments.
For loans tied to goods imported through Rasuwa Customs but destroyed by floods, banks will permit rescheduling based on the nature of the business, extent of damage, and insurance claims.
The package goes beyond debt management. Banks will be authorized to provide additional loans to revive industries, sustain trade, and safeguard employment. Officials said this measure is crucial to prevent closures and layoffs in flood-affected districts.
Entrepreneurs whose vehicles, machinery, or equipment were damaged will be eligible for concessional loans to purchase replacements. Banks will review the loan-to-value ratio for such financing, with interest rates set at the minimum premium above the base rate.
The government emphasized that these monetary relief measures will come into effect only after Nepal Rastra Bank issues necessary directives and guidelines. The central bank is expected to provide detailed instructions to commercial banks and financial institutions to ensure uniform application of the relief package.
The Bhotekoshi floods of August 26 caused widespread damage to transport networks, industrial assets, and trade flows, leaving hundreds of entrepreneurs grappling with destroyed vehicles, machinery, and goods. The Cabinet’s decision is expected to provide immediate financial relief while also opening avenues for long-term recovery.
