Employment scheme gets stuck
Kathmandu, March 9:
The foreign employment scheme, initiated by the government targeting the ‘disadvantaged group’ especially youths a year back, has got stuck due to lack of budget and low recovery of loans from job holders.
Loans without collaterals were made available by the government to job seekers going to foreign lands under the Youth Self-Employment and Employment Training Programme (YSEETP) through the Ministry of Labour and Transport (MLT).
A total of 705 people have gone abroad for jobs in Malaysia and Gulf countries under this scheme. 118 people from conflict-hit section, 251 from Dalit community and 335 from Janjatis and one woman have gone abroad to work, said ministry sources.
The lead banker for this foreign employment scheme, as per the understanding with the government, was the Bank of Kathmandu (BoK). BoK and other financial institutions have invested on 555 people from the Dalits, conflict-hit people and Janajatis, said ministry sources. Nabil Bank has given loans to 150 people under the government’s guarantee of Rs 65,000 per person.
Under the leadership of BoK, other financial institutions invested their money on foreign employment hoping that foreign job holders will repay the loans along with a good interest which stands at five per cent for a year.
The government had formally planned to invest Rs 50 million on foreign employment for the excluded sections of the society such as conflict-hit people, Dalits and Janjatis.
The government had set aside 10 per cent quota received by Nepal government for the scheme. Till today, the government has invested Rs 4,59,20,000 as seed money, taking it from various financial institutions under the guarantee of the government.
About four million rupees is being invested only on conflict-hit people. However, funding for Dalits and Janjatis has to be stopped due to financial constraints, revealed the source.
However, the government has not announced anything so far on the ‘break down’ of the contract with Nepal Bankers’ Association (NBA) which is headed by Radesh Pant of BoK, as president. The banks are now tightening the screws for recovery of loans, said sources.
However, of the total 705 persons who had gone abroad, some 50 had to pay additional amounts as per their salary structure abroad, said the official at the ministry of transport, on conditions of anonymity.
The problem in the scheme is that banks provided loans to foreign job holders taking the government as custodian but ‘loans recovery’ has been very negligible, coming to less than 25 per cent of the total amount. This is ‘troubling’ bankers to a great extend.
Due to their inability to recover loans given to foreign job holders, Nabil Bank has recently written a letter to the Ministry of Transport and Labour to take initiatives for fast recovery of loans, said the source. However, the government has not responded yet in this regard. Out of the total 705 people, only seven have repaid their loans.