Capital market a key to change: FM

Kathmandu, March 19:

Finance Minister Dr Baburam Bhattarai today tried to boost the confidence of investors saying that the government was committed to the development of the capital market. “Capital market is the key to industrialisation,” Dr Bhattarai said during his first visit to the Nepal Stock Exchange Ltd (Nepse) — the sole secondary market.

“However, the dominance of financial institutions should be reduced and more real sectors need to be listed,” added the Maoist finance minister. Contradicting popular belief that he is not serious about the development of capital market, the finance minister paid a visit to the secondary market that is considered a fast-track to capitalism.

On the occasion, acting revenue secretary Krishna Hari Baskota said that a few players have a monopoly of the market. “Despite the huge number of investors, it is only a few people who still have a hold over it,” he added. “The capital market can be a tool for poverty reduction,” said Shankar Man Singh, general manager of the government-owned Nepse. “It needs to be expanded to the rural areas,” he added.

At a time when two other stock exchanges are in the pipeline, the government should be serious about developing Nepse. “Nepse is an example of how a government-run institution can fare better, if run in a transparent manner” said Dr Narayan Prasad Poudel, Nepse chairman.

Established in 1993, Nepse has seen a sea change in its technology and development over the last one-and-a-half decades but still the number of brokers is small and the delay in transfer of share certificates is one of the hurdles pulling back market development.