Onus on govt to revive trade sector or it may die: FNCCI

Kathmandu, November 26:

“Hotels here are in strike mode in the peak tourist season but the government is silent even though it is aware of the impact on tourist arrivals,” said Federation of Nepalese Chambers of Commerce and Industry (FNCCI) president Kush Kumar Joshi here today while delivering a talk on ‘Global Financial Crisis and Its Impact in Nepal,’ organised by the Centre for Economic Development and Administration (CEDA).

According to Joshi, “The colour of the local environment plays a vital role in any country and if similar unruly activities continue and the government remains dumb, the internal crisis will have a worse impact than will the global financial crisis.”

He also said that Nepal does not have a diverse economic hold in the international arena, and so the global financial crisis would have less of an effect here than would the mounting internal crisis impact.

According to Joshi, the country has very little investment in industrial sector while everyday more and more industries are shutting down due to threats and growing insecurity.

He added that unless there is sustained peace and assured security in the business and industrial sector, no one would feel encouraged enough to invest in that sector.

Blaming the government for its inertia and fauilure to create an ivestor-friendly environment, Joshi said there was an urgent need to create an environment for mega investment in clean energy and added, “The resources are there but there is no atmosphere for investment. Instead of short term we should make long term investment, such as in the hydropower and tourism sectors. These sectors have great potential.”

Speaking on the occasion, Nepal Rastra Bank (NRB) acting governor Krishna Bahadur Manandhar said, “Bankruptcy is not an unusual phenomenon, but the present financial crisis is not due to bankruptcy.

The economy of Nepal is not as open in the international arena as that of the US and European countries. Therefore, the international crisis will not have such a deep impact on Nepal, but if financial crisis grows in India it will have a direct effect here.”

Finance secretary at the Ministry of Finance (MoF) Rameshwor Khanal said till date there has been no decline in the profit earned by the real sector.

Revenue collection has increased by 33.8 per cent within the first four months and eight days of the current fiscal year and it is expected that it will not go beyond 20 per cent, on an average.