APP moving in a snail’s pace

-By Dinesh Wagle

KATHMANDU, Jan 16- Agriculture Perspective Plan (APP) implemented with an aim of improving the poor economic state of the country is not moving towards its goal as expected. 

The achievement of the ambitious 20-year plan, which aims at bringing down poverty rate to 14 percent from 49, during the last two and a half year is far from satisfactory.

The involvement of private sector in the marketing of fertilizer and rise in shallow tube well installation are the only achievements of the plan which is running in the third year. Since the private sector has entered in fertilizer business, fertilizer availability has increased from 54.4 thousand tons nutrient in 1997/98 to 84.8 thousand tons nutrient in 1998/99 due to increase in supply of urea.

Similarly, shallow tube well installation in 1998/99 has increased to 5,124 compared to 1,809 installed in 1997/98, well over the target of 4,800 for fiscal year 1998/99.

“A single year is not enough to judge the outcome of such a plan”, says Hari Shankar Tripathi, Member of the National Planning Commission (NPC).

“Technically speaking, only a year and a half has passed. The plan came into effect at the end of the first year of implementation”, he elucidated.

The plan has identified four priority areas : irrigation, fertilizer, technology and infrastructure (agricultural road and rural electrification).

It expected to take them as a unified package to certain pocket areas. APP aims at increasing the 2.5 percent of average annual  growth in agriculture sector to 5 percent . The same rate of growth is expected in the non-agricultural sector as well. 

Many more organizational structures imagined by the APP are still to take shape. Those of being in the existence are either inactive or have no authority.

 Budget deficit is another factor behind the slow pace of the plan.

“Budget earmarked for the plan is not sufficient”, says Dr Champak Pokhrel, Chief of the Independent Analytical Unit (IAU), a monitoring body of the APP.

Agriculture road, one of the most important programmes of APP, is the most neglected sector in terms of budget allocation. APP proposed to construct 6,200 kms of the agriculture road . As per the interim APP, 2,232 kms road will be built during the Ninth Five Year Plan. But only 49 kms of road has been built in the last two and half years so far.

Agricultural  road programme was initiated in 16 districts during the FY 1998/99. Of the total 70 million budget allocated, 50.1 million was spent because of the late release of the budget.

For the running fiscal year, government has appropriated Rs. 150 million contrary to the APP recommendation investment sum of 1189 million rupees.

According to Prem Kumar Paudel, Director at the Department of Local Infrastructure Development and Agriculture Road (DoLIDAR), only Rs  30 million has been released and remaining sum is not released yet.

“The remaining sum is to be released under Agriculture Loan Programme of the Asian Development Bank (ADB)” he says. Certain conditions of the Bank are still to be fulfilled by some ministries. After that, the sum is expected to be released. Six months of the fiscal year has lapsed, but the budget has not been released yet.

The APP suffered from the late release of the budget last year and it is most likely to repeat this year too.

While districts are required to play prime role in APP implementation, training to the district office chiefs and local political representatives has remained very weak.

“This is the main problem APP is facing. It is not easy to continue the plan without giving training to district level officers and politicians”, says Dr Pokhrel. Training could not be provided due to lack of budget, he said.

Last year, District Agriculture Development Committee (DADC) and Programme Execution Committee (PEC) were formed for executing APP at the district level which recommends the center for programme implementation.

But the problem with them is that they don’t know how to discuss and make plan. If training is given to them, the problem will be solved, says Dr Pokhrel.

“Steps are not following the APP spirit”, says Dr Devendra Chapagain, APP formulation team leader.

It took two years to prepare the nationally agreed prime agenda for economic development and poverty alleviation. All the successive governments after the restoration of democracy have strongly agreed to implement the plan.

Ninth Plan (1997-2002) has taken APP as a major vehicle to alleviate poverty through accelerated growth in agriculture. Target of first five year of APP has been incorporated in the Ninth Plan.

According to IAU, immediate attention should be paid towards meeting resource gaps, pushing agricultural research and extension directly into the APP priority commodities and components. It says there is a challenge to meet the physical target of lagging inputs and effective monitoring of the output track.

Nepal to join South Asian Federation of Stock Exchanges

-By Sanjay Kumar Shah

DHAKA, Jan 16 - Nepal is participating in the Chittagong meeting taking place from Sunday to be a member of South Asian Federation of Stock Exchanges.

The move to form South Asian federation of stock exchanges has been taken by the Chittagong Stock Exchange (CASE).

Talking to The Kathmandu Post, Chairperson of CASE and Member of Parliament of Bangladesh Amir Khosru Chowdhury said small countries in South Asian region can overcome their investment limitations at the national level through cross-border listing and trading of shares.

While addressing a press briefing held at CASE premises in the south-eastern port city Chittagong ahead of the two-day conference of South Asian stock exchanges, Chowdhury said the stock exchanges of different regions of the world are now operating on the basis of mutual cooperation and understanding.

Federations of stock exchanges like the African Stock Exchanges Association (ASEA), East Asian and Oceanic Stock Exchanges Federation (EAOSEF), Federation and Euro-Asian Stock Exchanges (FEAS), Federation of European Stock Exchanges (FESE) and Ibero-American Federation of Stock Exchanges (FIABV) have been formed in greater regions of the world, he said.

In order to observe the meeting of SAARC countries, CASE contacted all the 31 stock exchanges in the member-states of all the member countries, and it has said that positive response
has been received for the conference.

Nepal, Pakistan, India, Bhutan, Sri Lanka and Bangladesh have already confirmed the participation.

“Various rules and regulations of Bangladesh often spark off debate and we often find limitations in the existing rules and regulations. But we feel we can share experiences with the neighboring countries, avoiding such unnecessary debates. The CASE has expanded stock trading from local to national level through automation,” Chowdhury pointed out.

Federation of International Stock Exchanges has hailed the CASE initiatives and its Secretary General Gerrit De Marez Oyens has confirmed his attendance at the conference.

Four basic objectives of the proposed federation of South Asian stock exchange are to foster cooperation among the members in order to promote development of their respective securities market, to represent the members in the international forums, to encourage development of an integrated international stock trading system in the region and offer listing and to emphasize on issue of common interests.

It is learnt that business, research, information dissemination, development of human resources through mutual cooperation would be attained through such association.

Govt to take action against tax evaders

-By a Post Reporter

BIRATNAGAR, Jan 16 - Finance Minister Mahesh Acharya has warned of taking severe action against businessmen who are evading taxes.

Although Value Added Tax (VAT) is the main source of revenue to the government, the activities of many businessmen are contrary to the provisions laid by it, Acharya said, while talking to pressmen here today.

He said, “Businessmen are not issuing proper bills to the consumers. To end such activities and to effectively collect revenue, the government has started taking severe action.”

Acharya admitted although VAT collection on imports is satisfactory, the internal collecting system has loopholes. He said, “The government is trying to raise awareness among the consumers about the success of VAT.”

Informing that the country’s economy has grown by 6 percent, he said that the government is committed to promote the major exporting items like pashmina and readymade garments with a view to improve the overall economic condition of the country.

He said that compared to the previous years, the trade deficit has decreased, the economic balance has strengthened and the foreign currency inflow is higher. “The government at present is paying attention towards strengthening the economy, in which the government is succeeding,” he said.

Highlighting on the need to create a favourable environment for investment inspite of the availability of adequate funds in the financial sector, he informed that the government is aiming towards improving the present interest rates.

He expressed his commitment to monitor commercial banks, cooperatives and finance companies working in a competitive environment and to mobilise the funds of the financial sector to productive use.

Economy, finance and market

-By Supa Upadhyay

Domestic money market:
Despite having liquidity in the banking sector, the AWDR of 91-day TBs further improved by 24 basis points to 4.72 percent. The NRB had received 32 bids worth NPR 1270 million against the notified amount NPR 750 million. The rupee was traded higher at 98.89 and lower at 98.80 for 91-day. In the weekly auction, the NRB is going to issue 91-day TBs worth NPR 760 million and 364-day TBs worth NPR 500 million on January 18, 2000.

Domestic capital market:
The stock market witnessed a encouraging trend on the back of improving economic indicators. On the NEPSE, some banking scrips further scaled new peaks. Nepal Grindlays, Himalayan Bank, Everest Bank and Bank of Kathmandu touched an all-time high while Nepal Indosuez Bank was a great loser on its recent big embezzlement. The brokers had quoted the prices of 52 companies in the trading board but only 36 companies were traded. The NEPSE index-100 touched an all time high and closed for the week at 269.88, netting a smart gain of 200 points over the previous week’s close.

This week, the index of Commercial bank, Insurance and Finance sector and Hotel groups improved while productive sector dipped down. Business groups and other groups remained unchanged. Commercial bank groups alone shared 75.11 percent of the total trading amount.

This week, altogether, 22072 shares amounting NPR 7.5 million were traded in three working days. Nineteen companies improved while only ten companies lost. Other seven traded scrips remained unchanged at their previous prices. Harisiddhi Brick & Tile, Universal Finance and Capital Market and Bank of Kathmandu registered first, second and third most traded company trading 5380, 4000 and 2980 shares respectively. Share of Nabil Bank, Nepal Indosuez Bank, Nepal Grindlays Bank, Himalayan Bank, Nepal SBI, Nepal B’desh Bank, Everest Bank, Bank of Kathmandu, Nepal Lever and United Insurance were able to trade in all three working days.

Forex round-up:
This week, the dollar ended unchanged against the sterling while it strengthened against the euro. The yen slipped modestly against the green back over the week. Recently an official of Finance Ministry for International Affair commented that it would be bad if the yen strengthens beyond 100 yen to the dollar and Japan should intervene to push the dollar up towards 110.

The INR and the NPR remained unchanged over the week against the dollar.

NEPSE Trading (Closing prices in NPR)

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