Promises of Tea Party

Whether Nepali tea industry can cash on it or not, the recent international tea fair in Kathmandu concluded on a highly promising note. A delegate from Japan promised to buy 250 MT of tea from Nepal each year till 2010. Similar promise to buy about 200 MT of Nepali tea each year was made from Pakistan, the largest tea importer of the world.

According to Mohammad Hanif Janoo, a senior member of Pakistan Tea Association, although Pakistan is growing tea in 6,000 hectare, still there is an import market for 185,000 kg. of tea in Pakistan.

If translated into reality, this combined promise of 450 MT comes out to be a rally huge quantity. In 1999-2000, Nepal’s total tea export stood at 81.6 MT only of which substantial portion went to Japan, Hong Kong and Germany.

The Tea Policy-2000, announced by Nepali government towards the end of the last year, has targeted to increase tea production in the country to 46111 MT per year within five years.

The three-day tea fair, called "Agro Business Interface 2001: Tea Event", was jointly organized by Nepal Tea and Coffee Development Board, Agro-enterprise Center, Nepal Tea Producers Association, Nepal Tea Association and Himalayan Orthodox Tea Producers Association. Participants from tea industry sector of countries like India, Bangladesh, Germany, UK and Sri Lanka attended the event.

Special Program for Indian Tourists

In a bid to woo Indian tourists, Nepal Tourism Board (NTB) has launched a special campaign entitled ‘Festival of Life’.

Targeting the peak season for Indian arrivals during May-June, NTB is issuing Privilege Cards, the holders of which are entitled to special benefits and attractive discounts in hotels, restaurants, cable car, department stores and the like.

According to NTB, the program is being carried out in collaboration with numerous tourism operators of the country as well as travel agents and airlines in India.

NTB also informs that it will involve popular India TV channels, like Zee and Star, as well as the print media for publicity of the campaign which, it hopes, will revive inflow of Indian tourists into the country that had slackened owing to the Indian Airline plane hijack in December, 1999.

Generally, over 30% of tourists in Nepal are Indian nationals. Though Indian Airlines resumed its flight to Nepal long ago, Indian tourist arrival by air in the month of April 2001 was only 35,325 as compared to 37,390 in the same month last year, according to the latest data compiled by NTB. The number was 41,087 in 1998 April.

 FNCCI has Green Cell

The apex chamber of the country, FNCCI, has set up "FNCCI Environment Cell" in its secretariat.

Set up as an environment service center with assistance from DANIDA, a Danish development agency, the FNCCI green cell is to provide information on environment to the entrepreneurs and general public through various programs and to forward suggestions to agencies concerned for necessary reforms in the policy and rules relating to environment.

More Nepali Cos Receive ISO

Pioneer Electro Cables Pvt. Ltd. and Pioneer Wires Pvt. Ltd. have joined the club of ISO certified Nepali companies by receiving ISO 9002 : 1994 certificate from Det Norske Veritas (DNV) of The Netherlands. ISO 9002 is awarded as management system certificate.

Affiliated to Sarda Group, the companies were provided the certificates in January 2001 by New Delhi office of DNV, but the fact was revealed by the companies only recently.

Meanwhile, Premier Wires (P) Ltd., another company of Sarda Group and Hama Iron and Steel Industries (P) Ltd., have received ISO 9001 : 2000 certificate from the TUV CERT certification body of Germany.

ISO certification is increasingly becoming a must for Nepali companies to compete in the international market and also in domestic field where clients prefer to go for products from ISO certified companies.

So far some Nepali companies in liquor, electricity transformer, steel rods, paints, pharmaceuticals, electricity cables and telephone cables have acquired ISO certification.

NCC for Lower Income Tax

The 48th AGM of Nepal Chamber of Commerce (NCC) has recommended His Majesty’s Government to raise the ceiling of non-taxable income to Rs 100,000 for individual and Rs 150,000 for family.

Pointing out that businessmen were also required to pay import duty for goods destroyed during shipping because of not being able to claim insurance due to lack of a proper system, NCC has demanded that a system be put in place to facilitate businessmen to prove that particular goods were destroyed during shipment and are therefore not subject to duty.

Among its other recommendations, NCC has asked for relaxation on the existing rule that requires the firms to preserve books of accounts for six years. NCC says, it will be practical to preserve the books for three years only. It has also demanded that the requirement to deposit the income tax amount assessed by Income Tax Department before going for appeal against the department’s decision should be scrapped.

Devt Credit Bank’s 100 Days

Collecting Rs. 350 million as deposits and investing Rs. 270 million during its first 100 days of operation, Development Credit Bank Ltd (DCBL), the youngest national level development bank of the country says, it has registered a net profit of Rs. 1.2 million before provisions for loan loss. The loan commitment figure from the bank has reached Rs. 310 million.

According to Sudhir Khatri, President (CEO) of the bank, such a high profitability within so short a period is a record in Nepal’s financial sector companies. "The secret lies in selection of good projects for investment, observing economy in operational expenses and maintaining low pre-operating cost", he adds.

The bank has so far financed agriculture, manufacturing, construction and service sectors, and plans to go for housing, IT and nursing home in the near future as a venture capital investor.

An application of the bank seeking permission to float Development Bond of nearly Rs. 150 million is presently under consideration of Nepal Rastra Bank. DCBL is also preparing to float its 30% shares to the public before mid-January next year. Before distributing shares to the general public, a development bank cannot open branches, according to the prevailing rules.

Of the company’s total issued capital of Rs. 160 million, 51% is held by individual promoters. Out of the 19% shares set aside for institutional shareholders, Pan-World International is to take 5%, informed Khatri.

New Boss in Insurance Board

Dr.Kafle
Lava Prasad Sharma has resigned as Chairman of Insurance Board, the regulatory body of the country’s insurance business. Meanwhile, the government has appointed Dr. Prafulla Kumar Kafle, a former Deputy Governor of Nepal Rastra Bank, to take Sharma’s place the Board.

Sharma worked as the chairman of the board for nearly nine years. He has cited health reasons for his resignation.

Carpet Initiative

What should you do if you lose your market? Turn to domestic market. This is the answer thatNepali Carpet industrialists have come up with as shown by Central Carpet Industries Association (CCIA) which has recently set up Carpet Center and Carpet Training Center at Pulchock of Lalitpur, in cooperation with Export Promotion Committee of HMG.

The initiative comes at a time when the country’s number one export item overseas two years ago has been experiencing an ever dwindling international market. Efforts to diverify international market for Nepali carpets in USA and UK have not been successful to compensate the loss of German market on which Nepali carpet industry has been heavily dependent traditionally.

The highest quantity of carpets exports from Nepal was achieved in Fiscal Year 1993/94 (3.325 million square meters worth Rs. 9.52 billion) and employment provided by the industry that year was for about 500,000 persons.The exports swooped down to 2.5 million square meter (Rs. 9.65 billion) in 1999/2000, according to CCIA. The downward trend is still continuing and the total exports of carpets during the first nine months of the current fiscal year is recorded to be 1.67 million square meter only.

The board has been under investigation by parliament’s Public Accounts Committee and the Commission for the Investigation of Abuse of Authority.

Insurance business in Nepal has become an attractive sector to invest in as evidenced by a large number of applications waiting permission from the Insurance Board. The proposed companies include Laxmi Life Insurance, Kantipur Life Insurance, Jeevan Dhara Life Insurance, Himalayan Life Insurance and Global Life Insurance. Similarly, in non-life insurance sector, the aspirants are NB Insurance, Yeti Insurance, Prudential Insurance, Reliable Insurance, Lumbini Insurance and Binny Insurance.

Clearing these applications is going to be the challenge to tackled by the new Chairman.

Business news | Legal side | Column | Corporate | Cover Feature | Tourism | Economy & Policy | Sectoral | Personality | Showbiz | Interview | Last Word | Management | Marketing | World Trends | Stock marketing | Main |

Send your feedback to the editor: bizline@mos.com.np 1999 © Mercantile Communications Pvt. Ltd. P.O. Box 876, Durbar Marg, Kathmandu, NEPAL. Tel : 977 1 220 773, 243 566 . Fax: 977 1 225 407. Reproduction in any form is prohibited without prior permission. No part of the articles which appear in the internet version on BUSINESSAGE may be reproduced without the permission of Mercantile Communications Pvt. Ltd. For reprinting rights, please write to us.  Send us your feedback:contact us . This site is best viewed at : 800 X 600 resolution