KATHMANDU, OCT 17: The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) on Monday drew the attention of Nepal Rastra Bank (NRB) to come up with appropriate policies to address the problems seen in Nepal’s financial sector.
In a meeting with Acting Governor of NRB Neelam Dhungana, the FNCCI delegation urged the central bank to take special initiatives to address the ongoing problems that appeared in liquidity management, interest rate stability, external sector management and price stability. According to the umbrella organization of the private sector, both these internal and external factors are posing multidimensional impacts in the entire economy.
Revised interest rate corridor system introduced
FNCCI President Shekhar Golchha said the private sector has been going through one of the most difficult times at present. “Through annulling the new provision of working capital loans among others, the central bank can make the economic activities more vibrant,” he said.
Due to an increase in interest rate, the cost of capital has largely increased. Surges in prices of petroleum products, among others, have raised the market prices. With a slowdown in economic activities, the government’s revenue collection has also declined by around 20 percent, according to the FNCCI.
The umbrella organization has urged the central bank to maintain interest rates at a single digit, while checking excessive hikes in premium interest rates. Revising credit-deposit (CD) ratio, increasing capital expenditure, allowing banks utilize 50 percent of the unused government fund, facilitating private sector and banks to take external commercial borrowing and restructuring and rescheduling of bank loans taken by private sector are among the suggestions put forth by the FNCCI to the central bank.
