The President of Federation of Nepalese Chambers of Commerce and Industry, Anjan Shrestha, has said that the country’s economy cannot make a progress unless the upcoming monetary policy brings real relief for the private sector.
Speaking at a meeting of the Finance Committee of the House of Representatives, President Shrestha said that the private sector have very high expectations from the upcoming monetary policy. He mentioned that the monetary policy must cover the issues that the budget failed to address in order to improve the struggling economy. He believes that without policy reforms to revive the market, the economy cannot gain any speed.
Need for Supporting Domestic Production
President Shrestha highlighted that the monetary policy should focus on boosting domestic production, encouraging investment, and creating new jobs. He pointed out that both the government and the private sector are blamed for not creating enough jobs in the country. However, he claimed that the private sector actually provides about 86 percent of the total employment in Nepal, while the state contribution is very low.
Because the state have not supported industries and the manufacturing sector properly, imports in Nepal are rising rapidly. He shared that Nepal currently imports about 70 percent of its goods and produces only 30 percent locally. He suggested that the state must think of ways to produce 70 percent of goods inside Nepal. He said about 20 percent of imports are petroleum products. Currently, petrol exploration is going on in western Nepal, and there is talk of gas in Dailekh, which might solve the energy issue in the future. But for the remaining 50 percent of goods, the country must plan to produce them locally to replace imports and change the face of the economy.
Policy Stability and Banking Challenges
He also expressed that people often complain about the private sector putting money only in land instead of being innovative. But he explained that to doing business, people are forced to keep land as security to get bank loans. This makes them invest in land. He said that the private sector wants to be creative, but they need stable policies, clear intentions from the government, and a friendly environment for investment.
Lastly, he mentioned that the frequent changes in state policies have put the private sector in trouble. He requested the central bank to bring a monetary policy that helps to increase credit flow in the market to revive business activities.
AI Disclaimer: This article was originally published on https://bajarkochirfar.com. It has been translated with the help of AI. For the best understanding and accurate facts, we recommend reading the original Nepali version.
