Top Economic news for this week – 25th Baisakh to 31st Baisakh

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Jestha 1, 2073- This week's main events that provide insight into current Nepalese economic environment have been briefly presented below:

Insurance market regulators of South Asia are meeting in Kathmandu next week in a bid to enhance insurance outreach through regional cooperation. Fatta Bahadur KC, chairman of Beema Samiti, said that the conference aims to enhance cross border cooperation and knowledge sharing on good insurance practices among South Asian countries.

Though the government included 'increasing production and replacing import of agricultural products' as its slogan in fiscal policies of at least past five years, it has failed to get desired results. Agricultural production has seen falling with every passing year. Government officials are including the same slogan in the budget for the new fiscal year which begins in mid-July.

Ncell has paid Rs.9.96 billion capital gains tax to the government. The telecom operator informed about the payment of the tax by organizing a press meet in Kathmandu on Sunday.

The government has announced that it will observe 2018 as 'Visit Nepal Year' with a target of welcoming on million tourists to the country. The announcement has come in the wake of slump in tourist arrivals due to devastating earthquakes of 2015 and border disruptions. The Policy and Programs for 2016/17 states that the government will launch different promotional programs prior to the Visit Nepal Year 2018.

American business magazine Forbes has published a list of “The 20 best value cities for budget travelers” placing Pokhara, a popular tourist destination in western Nepal, at the top.

The government has said that it will create job and employment opportunities in reconstruction and new construction areas. The Policies and Programs for 2016/17 unveiled on Sunday states that the government will work to expand agriculture, tourism, industry and service sectors. The government has claimed that dependence on foreign labor markets for employment will be gradually reduced by generating sufficient employment opportunities at home.

The government has vowed to make supply of food items and petroleum products more productive in the coming year. The government's Policies and Programs for 2016/17, which was presented to the parliament by President Bidhya Devi Bhandari, states that supply of food products and fuel will get high priority. The document states that it will make supply arrangement more effective for food security in remote and inaccessible areas, including Karnali zone.

Putting an end to confusion surrounding execution of the much-awaited Kathmandu Tarai-Madesh Fast Track, the government in it Policy and Programs for Fiscal Year 2016/17 unveiled on Sunday announced to build the 76-kilometer expressway by mobilizing internal resources. This road project is said to crucial to facilitate north south connectivity.

The government is taking initiative to become self-reliant in agricultural products and medicines, and focus on trade diversification to reduce trade dependence on a single country. The Policies and Programs 2016 unveiled on Sunday has taken an approach of sustainable, self-dependent economy, learning lessons from supply disruptions along Nepal-India border creased, it is still very low to meet the demand.

The 13th Handicraft Trade Fair and 11th Craft Competition concluded on Monday recording Rs.60 million worth of transactions and participation of around 250,000 visitors.

Ncell has said that it contributed approximately Rs.129 billion to the national treasury. Issuing a statement on Tuesday, Ncell said that the financial contribution to this extent until the date has been made in the form of fees, royalty and taxes. In addition to that, Ncell has unveiled plan to invest US$ 120 million (approximately Rs.12 billion) for the development of telecommunications infrastructure in Nepal this year. Issuing a statement, Ncell said it will be the largest capital expenditure undertaken by it so far.

International Consortium of Investigative Journalists (ICIJ), a nonprofit organization based in Washington, on Monday night published names of seven Nepalese who are shareholders of offshore companies. According to the Panama Papers, the seven Nepalese are Upendra Mahato, Nawang Dolma, Uma Devi Singhania, Arun Kumar Chaudhary, Survansh Kumar Chaudhary , Karan Kumar Chaudhary and Shila Chaudhary.

Experts have long been saying that outdated laws and policies, some of which date back to 1990s, are constraints to country's economic growth. But the government's Policies and Programs for 2016/17, unveiled on Sunday, is silent on economic reforms.

The government has directed Nepal Oil Corporation (NOC) to immediately introduce 'consumer card system' for distribution of liquefied petroleum (LP) gas. Ministry of Supplies issued the direction last week after stakeholders – gas bottlers, dealers and consumer rights bodies – told the government that consumer card system is the best way to control black market of cooking fuel and make its distribution mechanism effective.

Manufacturing sector, victimized by politics and energy crisis, has been further damaged by the government's equal treatment to raw materials and finished products.

The government has been encouraging deindustrialization by levying equal customs duty on raw materials and finished products, according to business fraternity. The government levies equal tax on most of the raw materials and finished product which is discouraging the industrial sector, according to Haribhakta Sharma, president of the Confederation of Nepalese Industries (CNI).

Nepal and Bangladesh have agreed to eliminate technical trade barriers between the two countries. The two South Asian neighbors signed a Memorandum of Understanding (MoU) to this effect during trade secretary level talks held Dhaka on Wednesday. According to news reports, Bangladesh has sought duty free access to 56 items in Nepal, while offering similar facility to 108 Nepali products.

Work of Postal Highway, which is also known as Hulaki Rajmarg, has been affected because of the delay in getting consent for selection of contractors from the Indian government nine sections. Delay in budget release by the Government of India has also affected the project, according to government officials. However, some sections of the project are being executed with the Indian government grants.

With the news of Melamchi Water coming in Kathmandu Valley by the end of 2016 AD, Asian Development Bank, Nepal Residential Mission (ADB-NRM) has intensified its site visit in different location of Kathmandu Valley in coordination with Project Implementation Directorate/Kathmandu Upatyaka Khanepani Limited (PID/KUKL).

Nepal Stock Exchange (Nepse) benchmark index gained 9.25 points this week to close at-1,481.94 points on Thursday, the last trading day of the week.

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