Top Economic news for this week- 23rd Magh to 29th Magh

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Falgun 01, 2072- Last week's main events that provide insight into current Nepalese economic environment have been briefly presented below:

  • The Samyukta Loktantrik Madhesi Morcha (SLMM) has decided to call off their programmes of strike, border blockade and protest. A meeting of the SLMM in Kathmandu on Monday decided to postpone the protest programmes in view of what it called “citizen’s suggestion”.
  • With the blockade being lifted from Saturday, the revenue collection in Birgunj has gone up. The customs has collected Rs.8.5 million on last Friday and Rs.38.5 million has been collected on last Saturday.
  • The Foreign Employment Promotion Board is to provide free training to 10,000 youths willing to go for foreign employment.  The training is being provided to the youths as most of them are unskilled and hence face difficulty in course of employment abroad. Previously, the FEPB had been organizing such training to around 3,000 youths annually and now is extending with a target to reach to 10,000 youths.
  • Around 18 months of the destruction by the Jure landslide and further aggravation by the April 25 earthquake, the 2.6 megawatt Sunkoshi Hydropower Project has started producing electricity. It has started generating up to 1.2 megawatt power after the water level receded significantly.
  • Nepal Bangladesh (NB) Bank Ltd.'s CEO Gyanendra Prasad Dhungana has been felicitated with 'Manager of the Year-2015' award. The award was handed by President Bidhya Devi Bhandari at a function held on Friday. The award was provided for his managerial roles in reestablishing the NB Bank as a best bank.
  • Citizens Investment Trust (CIT) and Rastriya Beema Company Ltd (RBCL) have signed an agreement to administer pension fund scheme. The agreement aims to make the pension distribution process for the current and retired staff of the insurance company easier.
  • The government, on Sunday, announced nominal cut in public transportation fare which is unlikely to benefit commuters. Ministry of Physical Planning and Transport (MoPPT), on recommendation of Department of Transport Management (DoTM), slashed transportation fare by 2.53 percent on Sunday. The new fare will come into effect from Monday. As per the new adjustment, minimum fare in local routes remains unchanged at Rs.13. Similarly, fare distance of up to 16 kilometers also remains unchanged. Fare for trips between 16 and 24 kilometers will come down by Re 1. Similarly, passengers will have pay Rs.5 less for every 100 kilometers.
  • Commercial banks disbursed a whopping Rs.19 billion in loans in the second week of January, raising suspicions that the banks might have tapped the relaxation that Nepal Rastra Bank (NRB) recently provided to bank and financial institutions (BFIs) to capitalize a huge interest amount from the borrowers hit by the recent turmoil.  While 30 commercial banks were floating an average of around Rs.3 billion in loans in the earlier weeks, their credit disbursement jumped suddenly by Rs.19 billion in the second week of January to Rs.1,175 billion.
  • Nepali handicraft entrepreneurs have sought support of the government for promotion of their products in the global market. At an interaction on 'Role of World Craft Council (WCC) in Handicraft Promotion', former president of Federation of Handicraft Associations of Nepal (FHAN) said Nepal, which became of WCC in 1990, has not been able to take benefit from membership of WCC despite being rich in culture and tradition and have requested the government to help in globalization, marketing and promotion of Nepali handicraft products.
  • According to expedition operators, the government's failure to take decision on a proposal to extend climbing permit of mountaineers, who abandoned their expedition last spring because of the devastating earthquake, could hit the expedition business this spring. They say many climbers were still waiting for the government decision, while some have already canceled their trips.
  • The Raxaul-based depot of the Indian Oil Corporation (IOC) has finally begun loading fuel onto Nepali tankers following IOC's instruction to its Raxaul depot for the same. The development comes following the reopening of the Birgunj-Raxaul border point from last Friday.
  • Nepal Stock Exchange (Nepse) is setting new records in recent weeks, as euphoria grips the stock market investors. Market analysts, however, say that the market is solely guided by speculations rather than solid macroeconomic fundamentals of the country. The benchmark index inched up 0.93 points to close at a record high of 1,263.75 points on Monday. Analysts say rise in stock market based on speculations will put investors in risk as such growth is highly prone to a sudden fall.
  • A taskforce headed by former vice-chairman of the National Planning Commission (NPC), has suggested allowing the establishment of an infrastructure development bank to finance infrastructure projects having a fixed capital of Rs500 million or more. The potential infrastructure development bank should have an authorized capital of Rs.100 billion, issued capital of Rs.50 billion and paid-up capital of Rs.20 billion. The bank is necessary to invest in energy, irrigation, railway, airport and tourism and urban infrastructure.
  • With Prabhu Bank Ltd all set to start joint operation after merger with Grand Bank Nepal Ltd from this Friday, the number of commercial banks in the country coming down to 29 from 30. The merger of Prabhu Bank Ltd with the ailing Grand Bank Nepal Ltd is the third merger among commercial banks in the country.
  • At a press conference, Gas Dealers Federation Nepal Chairman said the unsound reasoning made by the Nepal Gas Company and distributing gas cylinders from its premises encouraged black market trading at a time when the people have been reeling for long under the shortage by the blockade of transit routes which has now been lifted. The Federation has also appealed to the distributors to purchase the gas cylinders provided from the company's premises in regular rate fixed by the government and not take it with additional price attached.
  • Finance minister Bishnu Prasad Paudel has sought additional assistance for development of two hydropower projects from India. Minister Paudel sought grant assistance to develop a reservoir project of 250 MW and line of credit to build a project of 500 MW capacity.
  • Bhawan Bhatta has been nominated as the new chairman of Nepal Purwadhar Bikash Company Limited (NPBCL). A board meeting held to decide on the resignation of President Kush Kumar Joshi on Wednesday evening approved Joshi's resignation and nominated Bhatta as the company's chair unanimously, informed Nugal Vaidya, a board member of the company.
  • In one of the largest voluntary retirement schemes (VRS) in the history of Nepali state-owned enterprises, Nepal Telecom (NT) will be giving a golden handshake to as many as 796 employees following a board decision on Wednesday. A total of 822 employees had applied to join the plan after it was opened. Most of those who chose to leave under the VRS have been with the institution for 25 years or more.
  • With the demand declining at the international market, farmers are compelled to sell their cardamom at the lowest price in two years in the district. According to local traders, the price of cardamom, popularly known as black gold, has fallen to a two-year-low of Rs.80,000 per 40 kg which was previously traded for Rs. 120,000 per 40 kg last year.
  • Nepal was one of the key attractions at the International Mediterranean Tourism Market (IMTM) 2016 organized in Tel Aviv, Israel, from February 9 to 10. The golden Everest was the highlight of the Nepal counter at the IMTM. Furthermore, the Nepal stall also showcased adventure and cultural experiences where the participants and other international counterparts were intrigued by Nepal.
  • Global IME Bank Ltd has invited application for subscription of its 80 million units of mutual fund under ‘Global IME Samunnat Scheme-1’.  The minimum limit is 100 units and the face value of the scheme is Rs.10 per unit. Global IME Capital is the fund manager of the close-end scheme that has maturity period of seven years. The CEO of the Global IME capital stated that fund size can be stretched by 1.25 percent to Rs.1 billion if the scheme is oversubscribed. The fund collected will be invested on various instruments including shares, equities and initial public offering (IPO), among other market instruments, to ensure better return to unit holders.

"This summarized news has been written on the basis of news published on The Kathmandu Post and My Republica during the week"