The decision to bring NIDC under the wings of finance ministry was taken during the High Level Finance Sector Coordination Committee meeting, chaired by Finance Minister Barsha Man Pun, on Friday.[break]
Earlier, NIDC was under the control of the Ministry of Industry (MoI).
“Since MoI has not expressed any objection, the process of handing over the financial institution will begin soon,” a reliable MoF source told Republica.
The latest decision to bring the two entities under one ministry is expected to ramp up the merger process, which will provide ailing RBB a much needed capital boost to turn its negative net worth into positive.
The meeting also decided to form a team comprising officials of the MoF, Department of Customs and Nepal Rastra Bank (NRB) to assess the effects of supply glut of paddy, soybean, ginger and betel nut on local farmers. This decision was taken after the government found that farmers were not getting fair prices for the agricultural products due to rise in their production as well as imports.
“The team will discuss ways to provide cushion to farmers, who have seen abundance of these products in the market, making them unable to fetch relatively good prices,” the source said, ruling out possibilities of imposing ban on imports of the identified products.
In addition to this, the government is also forming another team comprising representatives of the MoF, the Ministry of Commerce and Supplies, NRB and private sector to conduct studies on ways to smoothen supply of petroleum products in case of shortage of fossil fuel in the international market and subsequent price hike.
The government´s decision to form a team comes at a time when the European Union is all set to put an embargo on oil produced by Iran to control the country´s nuclear program. Although the sanction does not come into effect until July, it has started affecting oil trade in Asia, Europe and the Middle East, according to Reuters.
The government is also believed to have taken the decision to form a team as Indian Oil Corporation (IOC), the sole supplier of petroleum products for Nepal, is under stress for selling petroleum products at subsidized rates. IOC´s total liability toward entry tax on crude oil and natural gas for 13 years is estimated at Rs 175.46 billion (IRs 109.66 billion), as per The Times of India.
“If we face supply constraints due to these problems, over which we have no control, we have to be prepared to ensure smooth supply of oil in the country,” the source said.
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