Internal loan increased 10 percent

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KATHMANDU, Sept 15 - Propelled by the ever increasing budget deficit mainly due to the huge mismatch between the real realization of the revenue and the expenditure, the government’s domestic outstanding has registered an increment of more than 10 per cent in the last fiscal year.

According to the statistics of Nepal Rastra Bank, the total outstanding for the domestic borrowings in the last fiscal year has increased to Rs 56.15 billion compared to Rs 50.70 billion in the previous year.

During the last fiscal year, there has been a significant increase in total outstanding for development bonds from Rs 4.26 billion to Rs 5.96 billion - a soar of 39.88 per cent. Similarly, the outstanding for the Treasury Bills has also shown a significant increment of 31.21 per cent that increased from Rs 21.02 billion to Rs 27.61 billion last year.

In the like manner, the government has total domestic loan of 12.47 billion on National Savings Certificate that increased by 8.24 per cent from previous year’s outstanding of Rs 11.52 billion.

Despite the increase in total borrowings, there has been a noticeable decline of 27.29 per cent in the special bonds. The outstanding with the special bonds declined from Rs 13.89 billion in the previous year to Rs 10.10 billion in the last year. The total liability of special bonds declined last year because there was a repayment of Rs 3.47 billion in the special bonds, said Dr Govinda Bahadur Thapa, a public finance expert.

According to the statistics, during the last fiscal year, government issued national savings certificates worth Rs 2.1 billion, development bonds worth Rs 1.7 billion and treasury bills worth Rs 1.7 billion. In addition to these borrowings, the government had taken the overdraft of Rs 5.57 billion from the Central Bank.

Domestic borrowing is government’s one of the important machinery of deficit financing because of being relatively easier to collect and are reliable. As an international practice, Nepal Rastra Bank, on behalf of the government, issues three different monetary instruments to collect the internal loans for domestic borrowings.

Out of the total outstanding, around 85 per cent is owned by the banking and the financial sector, while the remaining 15 per cent by the individuals.

Stock market slips by 11.69 pts

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KATHMANDU, Sept 15 – In yet another strong indication of weakening confidence of the stock investors, the index of the Nepal Stock Exchange (Nepse) recorded another double-digit tumble during this week throwing cold water on the renewed expectation of the speculative investors.

In the wake of series of double-digit plunge on Nepal Stock Exchange (Nepse) index, the marginal decline on the index last week had created a ray of hope of the revival of the share market.

According to the stock information compiled and disseminated by Nepse, the index, during the transaction this week, slumped by 11.69 points and settled at 265.22 points on the closing Friday from 276.91 points recorded on the opening Monday. The index had recorded a marginal slump of 1.43 points last week and touched 280.40 points from 281.83 points whereas the market had plunged by 14.13 points in the previous week.

The main cause of sliding confidence of the share investors is the ongoing political instability and the confusion created by the intensified activities of the Maoist affiliated sister organizations.

In the group-wise manner, the index of commercial banks declined by almost 6 points and remained at 260.75 points from 276.06 points against a marginal revive recorded last week. Similarly, the index of Manufacturing and Processing group also tumbled by over 10 points and settled at 304.16 points from 314.85 points whereas the group had recorded a marginal slump last week.

In the like manner, trading group’s index also fell by over 10 points to touch 100.14 points from 110.37 whereas no share transaction was recorded for the trading group last week.

Insurance and finance group also recorded similar decline of around 3 point and remained at 310.97 points from 313.03 points. The index of others remained unchanged at 166.09 points whereas it was declined by over 11 points last week. Similarly, the index of hotel also remained unchanged at 265.93 points.

In the group-wise market participation, the commercial bank group continued to capture its lion’s share of 79.85 per cent to secure the first position. During the transaction last week, the group had captured 60.07 per cent of the total transaction, while the group had captured 86.35 per cent of the share transaction two weeks ago.

During this week’s transaction, the participation of finance group, which has surged significantly to capture 34.89 per cent of the total transactions last week declined to capture 13.95 per cent and retained its second position. Such participation two weeks ago was just 10 per cent of the total transaction.

The participation of manufacturing and processing group, hotel group and insurance group was 0.49 per cent, 2.68 per cent and 1.56 per cent respectively. Similarly, the participation of other group and trading group were 0.13 per cent and 1.34 per cent respectively.

In terms of number of transaction, during this week, Nepal Merchant Banking and Finance Company topped the list with 119 transactions whereas, in terms value of transactions, Bank of Kathmandu was ranked in the top with the share trading worth Rs 3.90 million.

In this week 35,613 units of shares were traded in 627 transactions worth Rs 14.5 million whereas, last week, Nepse market witnessed a trade of 55,415 units of shares valued at Rs 22.9 million.

The trading floor at the Nepse was open for all five days of the week. The company whose shares were traded for all five days include Nepal Merchant Banking and Finance Company Limited, Bank of Kathmandu Ltd., Himalayan Bank Ltd., Everest Bank Limited, and Nepal Industrial and Commercial Bank Limited.

Concern expressed over fake, low quality drugs

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KATHMANDU, Sep 15 - Pharmacists and government officials have expressed their deep concern over the growing penetration of fake and low quality medicines in the market and have warned that it can bring catastrophic consequences if not checked on time.

According to the officials of the Pharmaceutical Marketing Executive Association of Nepal (PEAN), various kinds of counterfeit and different quality of medicines are sold in the Terai region, which has created a serious threat to the public health. "In some places of the Terai region, counterfeit medicines are even used in the lab, while in others, expired stuffs are relabeled and sold openly in the market," said Rajesh Man Pradhan, President of PEAN.

Bimal Man Shrestha of Department of Drug Administration (DDA) said, "Due to a lack of trained manpower, the department has not been able to control sale of such medicines effectively." There are four DDA officials in Biratnagar, seven in Nepalgunj and Birgunj, and four in the Center, he informed.

He further said that there has never been any increment in the number of employees in the DDA to monitor the inflow of counterfeit drugs. However, he denied naming such drugs but admitted that they are openly sold in the markets in the Terai.

According to the understanding reached by the government, private pharmaceuticals are allowed to manufacture 50 percent of the drugs required by the country. It has resulted in the manufacture and marketing of cheap drugs privately under a variety of names and new brands.

The price of the same tablet sometimes vary from Rs five to fifteen when it is re-produced under a different brand name.

The pharmaceutical manufacturers are required to obtain a GMP (Good Manufacturing Practice) certificate from the World Health Organization (WHO) after going through the process of product test.

Parasmani Baral, Central Chairperson of the PEAN said instead of reliable and affordable medicines, counterfeit medicines in their new brand names are sold in the market which when unchecked would affect the public health.

Inaugurating the 4th annual general body meeting of the Pharmaceuticals Marketing Executives Association of Nepal (PEAN) Dr Som Nath Aryal, Senior Physician and Secretary at the Ministry of Health said that a variety of drugs are coming into Nepal with different names and brands and some of them are counterfeit. There are 35 pharmaceutical manufacturing companies in Nepal and five more companies are going to be opened soon.

‘Development of construction business hindered’

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KATHMANDU, Sept 15 – Top construction businessmen gathered at a programme have said that the continued government indifference towards the construction business has hindered the development of the business.

Addressing a program organized here to mark the second Annual General Meeting (AGM) of Lalitpur Contractors’ Association (LCA), they also urged the government to put the business in the priority list and take concrete steps by formulating necessary policy and program to enhance capability of the domestic construction companies.

Speaking on the occasion, Shree Krishna Shrestha, President of LCA highlighted various activities of the Association and added that the construction businesses have played an important role in generating employment opportunities, particularly for the lower section of the society.

He also stressed the need to formulate strategic work plan to overcome the various challenges emerging in the development of the construction business and said that the government should be serious in sorting out the problems that are hindering in accelerating construction business.

"The government should come forward in minimizing the problems of the sector, which alone absorbs more than 60 per cent of the development expenditure allocated in the annual budget." He also urged the government to review its tender awarding process and to simplify the procedures of income tax clearance.

Addressing the gathering, Jip Tshering Lama, President of Federation of Contractors’ Association of Nepal shed light on the various activities of the Federation to protect the interest of the contractors and urged the government to take appropriate steps for the development of the business.