Nepal | June 03, 2020

NRB to bring relief package for businesses next week

Himalayan News Service
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Govt plans stimulus package for businesses through budget

Kathmandu, April 27

Nepal Rastra Bank is preparing to bring the second phase of stimulus package next week to provide relief to businesses hit by the coronavirus pandemic.

Deputy Governor Chintamani Siwakoti said the assessment of the impact of coronavirus across different sectors was in the final stage and would be completed in a few days. “Discussion is under way on the nature of relief that the central bank needs to offer to different sectors and the assessment being carried out by NRB is in the final stage,” he said, adding that some relief packages would be announced next week for sectors hit hard by the pandemic.

According to him, the relief this time will be sector-specific and basically be inclined towards further relaxation on repayment of loans for businesses and the public. The central bank introduced a few measures two weeks ago aimed at offering relaxation on repayment of loans for businesses and the public. However, as businesses have been completely shut for more than a month and the lockdown has prolonged, NRB is preparing to introduce the second phase of relief measures.

Addressing the 65th anniversary of NRB yesterday, NRB Governor Maha Prasad Adhikari had disclosed that the central bank would adopt flexible measures in loan and interest payment of the fourth quarter of this fiscal as well. The first relief package of NRB had primarily offered businesses and the public relaxation on repayment of loans that should be cleared within the third quarter. The bank had deferred the collection of monthly or quarterly instalments (that were to be collected by mid-April) from borrowers till mid-July.

The NRB is expected to further defer loan repayment period for businesses from mid-July.

“The tourism sector and small and medium enterprises have been hit really hard by the pandemic. NRB is more serious towards offering relief to such sectors,” added Siwakoti.

According to him, NRB is also discussing with the Ministry of Finance about the nature of relief to be provided to businesses by the central bank.

Meanwhile, the MoF, which was also expected to bring the second phase of stimulus package to revive businesses, is unlikely to do so anytime soon as discussion is under way to address concerns of businesses and the economy through the upcoming budget for fiscal year 2020-21, which is just about a month away.

“As coronavirus has not been contained and we are still unsure how it will evolve, we are facing difficulties in carrying out an assessment on the level of losses faced by businesses due to the pandemic. Thus, the plan is to address all key issues related to businesses and the economy through the budget,” said an official at MoF, seeking anonymity.

The business community has been asking the government to adopt short- and long-term measures to revive businesses and the economy.

A version of this article appears in e-paper on April 28, 2020 of The Himalayan Times.

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