Kathmandu, September 12, 2006

Despite tremendous growth potential and resources available in the country, the banking sector has not grown as per the expectations, thanks to weak banking culture in the country.

Bankers today said that of the total population, only 15.1 per cent people borrow from banks and the rest take loans from individuals or relatives that means majority of people continue to depend on traditional ways.

Bankers also urged the government to take action against defaulters who are not willing to repay loans taken from banks.

Finance minister Dr Ram Sharan Mahat said that after the liberalisation of the banking system in 1990s, the financial system of the country has improved and a number of market instruments have been launched.

The disappointing story is that banks have limited themselves to urban centers, said Dr Mahat. He expressed concerns that agriculture on which the majority of the people depend for their survival, gets nothing from private sector banks despite.

Banking experts also should fulfill social accountability and identify potential economic sectors for further investment, said Mahat. Kenichi Ohashi, country director of World Bank, stressed on the need to look at the defaulters’ issue as this demonstrates that the Nepali market system offers a crooked playing field.

Ohashi showed concerns that the poor have no access to credit, other than what they get from merciless money lenders at exorbitant rates.

Nepal for interim statute by mid-Oct

CPN-UML General Secretary Madhav Kumar Nepal today said the process to finalise the interim constitution should be completed in all respects by mid-October to pave way for the crucial elections to the constituent assembly by March or April.

Speaking at an interaction organised by Bagmati Special Bureau of the All Nepal National Free Students Union (ANNFSU), Nepal said it was crucial to complete all the processes regarding the formation of interim constitution by mid-October at the latest as the polls have always been conducted either in October-November or March-April.

He added that the delay would only give an opportunity to the royalists to become more active. He said he was taking up the issue of naming a new Chief Election Commissioner who would streamline the election process.

“I have already told the Prime Minister to appoint a new CEC,” said Nepal. He added that the eight-party joint meeting would be held to iron out differences to finalise the interim statue.

Regarding the increasing bitterness between the alliance and the Maoists, he said it was but natural to criticise each others’ wrong moves.

“The alliance between the seven parties and the Maoists should not snap now,” said Nepal, appealing the ANNFSU to strictly follow the ideological stand.