Kathmandu. The High-Level Economic Reforms Suggestion Commission has submitted a suggestion report to Finance Minister Bishnu Prasad Poudel. Commission Chairman Rameshwor Prasad Khanal submitted the report to Deputy Prime Minister and Finance Minister Bishnu Prasad Poudel at the Ministry of Finance.
The report mentions urgent matters that need to be done to make the economy more dynamic and strong. These include paying government liabilities and other arrears, facilitating real problematic borrowers in the financial sector, and enacting laws to regulate commercial lending.
Similarly, the report suggests addressing the problems seen in problematic cooperatives, increasing capital expenditure during the remaining period of the current fiscal year, accelerating the reconstruction of physical infrastructure damaged by disasters including the Jajarkot earthquake, accelerating the distribution of compensation for land acquisitions initiated by the government or for which the process has been finalized, and providing further facilitation to Indian tourists coming via the route.
It is suggested to prioritize the payment of completed construction works without entering into new contracts in the current fiscal year, and to include new projects in the budget for the coming year only if the budget can be made available by fulfilling the obligations created by entering into multi-year contracts. It has also been suggested to consider the availability of resources based on the impact of subsidies provided by the government in various sectors on production and employment and to review the interest subsidy program for concessional loans.
It is suggested to increase health insurance premiums and increase the co-pay ratio. The Commission suggests issuing a law to establish an asset management company in a public-private partnership in the context of a business that was in good condition before Covid and is currently in trouble but will improve later, and to provide an opportunity for loan rescheduling for one year, and in the context of a sluggish real estate market and increasing non-banking assets of banks.
To solve the problems seen in the cooperative sector, the report suggests making legal provisions to prevent the scope of work of savings and credit cooperatives from exceeding the geographical area of one local level, prohibiting cooperatives from making companies or any organized organizations members, and allowing only natural persons to be members. Suggestions have been made, such as making a legal provision for a single loan limit in savings and credit cooperatives like in financial institutions, and for the time being, making arrangements to prevent the total loan amount from one or more than one bank to a single person from exceeding ten percent of the total share capital of the investment institution.
The commission has suggested that all projects with an allocation of more than ten million rupees should be regularly monitored to increase capital expenditure during the remaining period of the current fiscal year and that a team with authority should be mobilized to solve the problems on the spot. The government had formed a high-level economic sector reform suggestion commission in the third week of Asoj last year to make suggestions on the economy.
The high-level economic suggestion commission had started its study work from the second week of Kartik 2081 as per the mandate given by the Government of Nepal. Previously, the commission had submitted an interim report on 24 Poush 2081, covering the issues that needed to be addressed immediately.
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