Himalayan News Service

Kathmandu, March 31:

Industrialists, businessmen and traders from eastern Nepal have asked the government not to put ‘wilful defaulters’ and ‘defaulters by circumstance’ in the same sack, while carrying out action and blacklisting. Representatives of Morang Traders’ Association (MTA) and Morang Industry Organisation (MIO) today said that the government has failed to segregate wilful defaulters and defaulters by circumstances, while financial institutions, especially commercial banks, have initiated action against both of them. They have also demanded an appropriate definition and classification of wilful defaulters and non-wilful defaulters. “Commercial banks, especially public sector banks like the Rastriya Banijya Bank and Nepal Bank Ltd, have initiated blacklisting without proper appraisal on both kinds of defaulters,” said Kishore Pradhan, president of MIO, at a press meet, today.

“Despite repeated requests, the government seems not serious to promote and protect industries. At the same time, banks are getting full support of the government,” he said.

According to Pradhan, more than 500 industries out of a total of 1,200 along the industrial corridor of Morang and Sunsari have been already closed or have become sick. The remaining ones are operating either at a loss or at an under-capacity. Jeevan Nepal, president of MTA, said that the government should set up an independent commission to investigate loan defaults. “There is no doubt that wilful defaulters must be brought under severe legal actions, but those defaulters by circumstances should be given time for rescheduling of their loans,” he said. He also stressed the need of a Proportionate Distribution Act in case of a bankrupt company, which will ensure the creditors’ share from the remaining assets. Nepal also lamented that NRB, despite being a central bank, failed to monitor loan disbursement in the past.