Kathmandu, June 27:

A visiting mission of the International Monetary Fund (IMF) thinks that the inflation in Nepal that is inching towards double digits is ‘still’ under control and manageable. “Nepal has a disciplined budget policy for the last couple of years,” Brain J Aitken, deputy division chief, Asia and Pacific Department said, adding that as long as Nepali currency that is pegged with Indian currency (IC) is maintained, inflation would not create any trouble. IMF has predicted eight per cent average inflation.

He, however, stressed on the adjustment of oil prices. The government has adjusted prices recently and it is one of the major reasons behind the rising inflation. “But it will not be unmanageable,” he said. “The introduction of an automatic pricing mechanism to allow adjustment of prices to world levels would help depoliticise the elimination of oil subsidies,” Aitken suggested without elaborating the model of such a mechanism.

It is the regular visit of the IMF mission. Every year, an IMF mission visits Nepal before the budget to interact with the government. “The current visit focused on the budget for the coming fiscal year,” he said, adding that despite the political turmoil, the macro-economic outlook had remained stable. Led by the service sector and agriculture, the output growth for this year could rise to 4.75 per cent, according to the IMF. “In the coming year, it could rise to 5.5 per cent,” Aitken said.

ADB team, Maoist brass parley

KATHMANDU: A visiting delegation of Asian Development Bank (ADB) — led by director Sebastian Paust — met senior leaders of the Communist Party of Nepal-Maoist here on Friday. Maoist chairman Pushpa Kamal Dahal and his deputy Baburam Bhattarai held discussions with six board members of the ADB team that arrived here on Monday. Nepal is a founder-member of ADB and, till December 31, 2007, cumulative lending to Nepal by the

ADB had reached $2.3 billion, with investment grants amounting to $183.9 million and technical assistance of $127.6 million. — HNS