National 3 (Spotlight Weekly)

High Expectations

Governor Dr. Tilak Rawal is confident that the new monetary policy will help to flourish export

By KESHAB POUDEL

"We did not announce the monetary policy expecting commendations from the business community nor did we wish to sell dreams to them. The monetary policy reflects what the country's reality is," said Dr. Tilak Rawal, governor of Nepal Rastra Bank (NRB), addressing journalists, businessmen and senior banking officials at an interaction program.

Dr. Rawal : Prescriptions for prosperity

Organized by the Society of Economic Journalists - Nepal (SEJON), various speakers discussed about the challenges in the implementation of the policy." I have not seen negative comments on the monetary policy and I don't think any body will criticize it in the days ahead. We have announced monetary policy to provide some relief to the business communities even amid the difficult economic situation of the country," said Dr. Rawal, the governor of the central bank.

With the objective of providing monetary stability, Nepal Rastra Bank announced a national monetary policy last month. One of the aims of the policy is to control the inflation level. Nepal Rastra Bank wants to see the inflation level below 5 percent.

Business leaders see the new monetary policy as a positive step to provide relief to the industries, which have been passing through a very difficult time. "Although Nepal Rastra Bank has its limitation, it has taken courageous step announcing new monetary policy. It will give some relief to the businesses and industrial sector," said Binod Bahadur Shrestha, newly elected president of Federation of Nepalese Chamber of Commerce and Industry (FNCCI). "The central bank has also worked out a plan to give certain relief to the sick industry."

Along with offering some new packages including allowing the business on the basis of credit card in foreign currency, the Monetary Policy has also suggested some positive steps including a cut in the interest rate.

"Our monetary policy is a small package but we have tried our best to address the economic problems faced by the country," said Rambabu Panta, deputy governor of Nepal Rastra Bank.

Others, too, expressed that there require a strong commitment to implement the policy. "Announcement of new monetary policy is one of commendable jobs of Nepal Rastra Bank since it will help small and medium entrepreneurs," said Rajesh Kaji Shrestha, president of Nepal Chamber of Commerce. "We hope that the policy will be implemented in accordance with its spirit."

Under the new monetary policy, Nepal Rastra Bank has also announced a package of 1.5 billion rupees to provide relief to the country's sick industries. Following the resurgence of Maoist movement, industrial sector was badly hurt and many hotels are running out of cash.

"I don't believe that announcement of policies and programs are not good but one cannot comment on the situation without looking at the implementation side," said Shrestha.

At a time when large number of industries are yet to pay the debt to bank and amount of inactive loan continues to increase, the monetary policy focuses on quick recovery of loans.

"There is growing tendency among the businessmen not to pay interest to the public banks. They are also creating trouble in the banking reform program," said Rajan Singh Bhandary, chief of Banking Department.

Announcing a new monetary policy, Nepal Rastra Bank has shown its concern to address the growing economic problems of the country and now the time has come to see how the business communities support its successful implementation.