‘Judiciary plays key role in reforms’

Kathmandu, November 18:

Supreme Court has played a significant role in the Nepali banking and financial sector reforms, said experts speaking at a review seminar on ‘Legal and judicial environment for financial sector development’, organised by Nepal Rastra Bank (NRB) and the World Bank (WB) here today. Bijaya Nath Bhattarai, governor of the NRB, said that the concerned sectors coordination can accelerate the pace of legal and judicial reforms of financial sector. “Nepal Rastra Bank Act-2002, Debt Recovery Act-2003, Bank and Financial Institution Ordinance-2004 are some of the achievements of the financial sector reforms,” he said adding the need to employ our available instruments, to put appropriate legal and institutional in place, and to legalise world-wide trend of high-tech electronic financial transactions in the present context.

“The right-sizing of Nepal Bank Ltd, RBB and NRB is the efforts aimed at making our banking system more professional and result-oriented,” he said.

Surendra Man Pradhan, executive director of NRB, highlighted the role of legal system in the operation of financial markets. “A competitive business and corporate sector is built on a solid legal foundation,” he said, “An effective judiciary applies and enforces laws and regulations impartially, predictably and efficiently.” Presenting a paper on ‘Legal and judicial environment for financial sector development,’ Nagavalli Annamalai, lead counsel of the World Bank, underlined current problems in the legal and regulatory framework and future reforms required for the effective development of the Nepali financial sector. She pointed out the issues like assessment of past and current reforms, legal and regulatory framework for supervision and governance of banking and capital market and creditors’ rights.

Annamalai not only presented the current problems in her paper — need of micro-finance policy, problems in judiciary system — but also suggested some recommendations to solve these problems. Dr Ram Krishna Timilsina, acting registrar of the Supreme Court, presented a paper on ‘Judicial initiation for developing corporate and financial sector justice system in Nepal. He presented the concept of justice in economic scenario, the role of judiciary for economic development and social justice, and corporate and financial reform through competent system of justice. “Establishment of commercial bench in designated courts, rights to appeal to the Supreme Court and providing special procedure for commercial cases are the immediate needs to move forward,” he pointed out.

Craig McAllister, CEO of NBL, Sashin Joshi, CEO of NIC Bank Ltd, Bharat Upreti, a corporate lawyer, Diwakar Golchha, first vice-president of FNCCI, Radha Krishna Poudel, banking member of DRT, K B Manandhar, deputy governor, Kenichi Ohasi, country director of the World bank and Sukhwinder Singh, resident representative of IMF commented on the papers.