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Kathmandu Tuesday February 12, 2002 Magh 30, 2058.
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Govt to announce tourism, export as ‘sick
industries’
By Satyendra Timilsina
KATHMANDU, Feb 11: In a fresh bid to revive the dwindling
tourism and export industry, the government is preparing to announce these industries as
"sick industries" and would provide them refinancing facility at subsidised
rates.
According to a high level source at the Ministry of Finance
(MoF), Nepal Rastra Bank, the Central Bank, has proposed to declare tourism, carpet,
garment, pashmina and other export based industries as sick industries and has forwarded
the proposal to the MoF for final approval.
After being announced as sick industries, these sectors will
receive subsidised soft loans from the commercial banks to revive their down-falling
business. And the Nepal Rastra Bank would compensate it by refinancing the loans at three
per cent to the commercial banks.
As per the newly developed methodology to measure sickness of
the hotels, the government would consider their room occupancy rate to find out those
hotels, which are financially weak and needs restructuring of loan and further financial
support to save them from complete collapse, informed the source. The specified room
occupancy rate will vary according to the standard of the hotels.
Similarly, in case of identifying the extent of sickness of
the export-oriented industry, the new methodology has taken the gross profit ratio as a
key indicator to sort out such companies that are in need of financial aid under the
privilege of sick industry.
However, both the ailing hotels and export-oriented
industries have to submit their valid income statements to the MoF to receive the
benefits. "The companies would not receive any loans if they fail to submit their
income statement," the source said.
The current economic slow-down throughout the world has also
affected Nepal’s tourism and export industry. The number of incoming tourists into
this Himalayan Kingdom fell by 21 per cent in 2001, as compared to last year.
Similarly, the business of the major export-oriented
industries is also going down since last year. The figures for the first five months of
this current fiscal year are even discouraging. Plagued by the global economic recession
combined with internal disturbances mainly due to the Maoists activities, total export,
according to the latest report, has declined by 8.2 per cent recording a heavy plunge in
the exports of the woollen carpets, readymade garments and pashmina.
Earlier, the Ministry of Industry, Commerce and Supplies had
announced to provide restructuring facilities on the loans invested on the tourism
industry by the banking system. And even had announced to prepare a fund of Rs. 500
million to restructure the bank loans taken by the tourism industry.
Narendra Bajracharya, president of Hotel Association of Nepal
(HAN), told The Kathmandu Post that the government is yet to implement its earlier plan to
restructure loans of the hotels industry. "We are still waiting for the government to
take necessary action."
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