Kathmandu, April 6

The government has appointed Maha Prasad Adhikari as the 17th governor of Nepal Rastra Bank.

A meeting of the Cabinet today decided to appoint Adhikari to the top post of the central bank from among the three candidates that the governor recommendation committee led by Finance Minister Yubaraj Khatiwada had suggested to the Council of Ministers.

Along with Adhikari, the committee had also recommended incumbent deputy governor Chinta Mani Siwakoti and former secretary Keshav Bhattarai as candidates for governor.

Regarded as a trusted aide of Khatiwada, Adhikari had previously served as deputy governor at NRB when Khatiwada was the NRB governor. Following his retirement from the deputy governor’s post in 2015, Adhikari was appointed as the chief executive officer of Investment Board Nepal.

Adhikari’s term at IBN was set to expire on June 22.

Adhikari was also recommended for the governor’s post in 2015 after Khatiwada had completed his tenure as the central bank governor.

However, the government then appointed Chiranjibi Nepal as the governor. Nepal completed his five-year tenure at NRB on March 18 following which the governor’s post had remained vacant.

Adhikari, a chartered accountant, has more than 30 years of experience in the banking sector. He served in the central bank alone for more than 25 years in different positions, including executive director and deputy governor.

Adhikari successfully hosted mega investment summits in 2017 and 2019. Adhikari is also credited for the decision taken by the central bank to raise the paidup capital of commercial banks by four times to Rs 8 billion in 2015, when he was serving as the deputy governor.

As Nepal is facing a turbulence triggered by the coronavirus pandemic, which has locked down cities worldwide, rendered millions jobless and sent economies into a tailspin, Adhikari has become governor in one of the toughest times for the economy historically, opines Shekhar Golchha, senior vice-president of the Federation of Nepalese Chambers of Commerce and Industry.

“The new governor and the entire government should not look beyond reviving businesses and boosting the morale of industrialists.

If we fail to properly revive businesses and the economy, the country will have to face a disaster,” said Golchha.

Besides the challenges to recover businesses and the economy from the devastation of coronavirus, Adhikari also faces the daunting task of ensuring stability of the financial market in Nepal, say economists.

“A major problem that the central bank has failed to address so far is the instability in interest rates which is killing the entrepreneurial spirit,” said Biswo Poudel, an economist. He added that the central bank should ensure stability in interest rates and use the Monetary Policy as a mechanism to do so.

Poudel also suggested that the new NRB leadership should give less priority to radical policies in the bank and financial sector and focus on effective implementation of existing policies and enhancing monitoring mechanisms and database in the central bank.

Meanwhile, bankers expect the central bank under Adhikari’s leadership to bring out a comprehensive strategy to pull different sectors, including banking sector and the entire economy, out of the coronavirus quagmire.

“We do not have any clear and comprehensive strategy to cope with the situation due to the pandemic.

As almost every sector has been hit by the coronavirus pandemic, the need today is to coordinate with all stakeholders and bring out a comprehensive strategy that will address the concerns of every sector,” said Anil Shah, former president of the Nepal Bankers’ Association.

READ ALSO: ‘Recovering the economy from COVID-19 will be my top priority’

A version of this article appears in e-paper on April 07, 2020 of The Himalayan Times.