Nepal Rastra Bank unveiled the Monetary Policy for fiscal year 2020-21 on Friday. The Himalayan Times caught up with some private sector representatives for their feedback on the Monetary Policy. Excerpts:
The monetary policy has addressed most of our demands. Provisions on refinancing and loan interests, among other policies, will surely provide relief to small and medium industries, along with the tourism sector.
Debt restructuring and rescheduling will support industrialists to revive their businesses during this crisis created by the COVID-19 pandemic. Moreover, the policy has also created a platform to attract investments specifically in the agriculture and hydropower sectors. The Monetary Policy has prioritised agriculture and energy sector this year, which is appreciable.
However, the policy needs strong execution for effective results.
- Shekhar Golchha, senior vice-president of Federation of Nepalese Chambers of Commerce and Industry
Transportation industry has faced a huge loss due to the lockdown and even after the government allowed public transport operators to resume operations, the business is likely to take at least a few months to normalise.
Against this backdrop, the Monetary Policy has provided relief to us to some extent. Moreover, provisions announced through the Monetary Policy regarding refinancing and loan instalments are the positive aspects. Nevertheless, much depends on its implementation modality. If the announced policies remain limited on paper, we the entrepreneurs still have reasons to be concerned.
Around 50 per cent of public vehicle entrepreneurs have taken loans from cooperatives, thus the government has to bring very precise and effective modality to implement these policies. We appreciate Nepal Rastra Bank for addressing our issues through the Monetary Policy.
- Bijay Swar, vice-president of Federation of Nepalese National Transport Entrepreneurs
The Monetary Policy has delighted the tourism sector, which is one of the sectors hardest hit by the COVID-19. Even though the private sector had been trying from their side, we need the government’s support as well. And the Monetary Policy has largely addressed the concerns that we had presented to the government since the last four months.
Actually the industry had been facing problems even before the lockdown. The Monetary Policy has provided relief to the private sector and now the NRB should effectively implement this policy as soon as possible. Along with that, banks and financial institutions (BFIs) need to be a bit liberal while implementing the provisions.
It will take at least two years for the tourism sector to revive, hence the BFIs need to be patient towards our industry regarding loans, loan interests, instalments and payments.
- Binayak Shah, vice-president of Hotel Association Nepal
For the first time in the history of the Monetary Policy, the central bank has highly prioritised small and cottage industries.
Economic crisis and lack of raw materials for our products had created difficulties for us. In this regard, the Monetary Policy has extended the deadline to pay our loans by one year.
Moreover, the provision of refinancing will save a lot of industries from collapsing.
Small industries with small investments are in danger of going bankrupt due to the lockdown. The refinancing facility will help those industries to revive. Likewise, loans at five per cent interest rate is another supportive step of the government for the sector. Implementation and monitoring of policy execution are equally important to make this policy successful.
- Umesh Prasad Singh, acting chairman of Federation of Nepal Cottage and Small Industries
A version of this article appears in e-paper on July 18, 2020, of The Himalayan Times.