Bihar mill surge eating into Nepal rice industry

THE number of rice mills in Birgunj has drastically dropped because of the surge in the number of ultramodern rice mills in bordering Indian territory in the recent days. Around 100 big and small mills were in operation until a couple of years ago, out of which only 20 are in operation today. Bihar Chief Minister Nitish Kumar on Thursday inaugurated Ripuraj Rice Mills established at Aamodehi, Raxaul in April. Rameshwor Prashad Gupta, director of mills, said the factory besides supplying its products to different Indian states will also export to 10 countries. The Bihar state government has proposed to invest IRs 150 million in the Raxaul area to operate food plaza. Nabin Kumar, chief secretary at the Industry Department of Bihar government, and Rashmi Burma of Finance Department from the central government flouted the proposal to this effect on June 8 during their site visit of the Ripuraj Mills. Around a dozen rice industries with a daily capacity ranging from 200,000 to 300,000 tonnes have opened in the vicinity of Raxaul. This has also led to the closure of around 75 percent of mills in Bara and Parsa districts in Nepal. Even a major of the factories around are struggling to operate in full capacity. Tara Kalawar, director of Om Food Industry based in Allau, Birgunj, said the factory’s production has come down by 50 percent. The Bihar government has offered incentive and tax exemption for establishing such industries. Kalawar said a number of industries producing rice were established after the Indian government imposed a ban on rice exports a few years ago. The relaxed provision on the Indian side of the border has pile pressure on the Nepali factories. “The industrialists are now facing difficulties to pay interest on their loans,” said Kalawar. Officials at the Birgunj Chamber of Commerce and Industry said the domestic industries are facing challenges to survive as the government dœs not have different customs policy on the import of paddy and rice. The government charges five percent agriculture tax on the import of paddy and rice. The local industrialists said higher quality rice is being imported under low quality brands to evade tax. “We have asked the customs office to evaluate the rice as per its families,” said Ashok Vaidhya, president of the Birgunj chamber. Customs chief Ramhari Aryal said his office will revise the customs valuation rate of rice within a month. “We are discussing the problems of local industrialists. We will soon revise the customs valuation rate,” he said. Rice worth Rs 1.49 billion and paddy worth Rs 3.99 billion was imported through the Birgunj customs.

Nepse logs 3.33 points gain in a week

NEPAL Stock Exchange (Nepse) gained 3.33 points last week to close at 551.44 points. It was the first time that the benchmark has crossed 550 points in the last six months. The upward movement of the stock market has gained momentum in the recent days with the companies listed on the Nepse showing good profit margin. Ram Chandra Bhattarai, director at Aryatara Investment _ Securities, attributed the recent gain to people’s hope that they would get good profit given that a majority of the companies are publishing their financial results of the last fiscal year. “The market is expected to go up until the companies announce book closure.” Of the nine groups categorised, six registered gains in their respective indices. hydropower companies topped the list with a gain of 98.22 points, followed by hotels, manufacturing, development Banks, ‘others’ and finance companies. Bhattrai said the expectation of investors that Chilime Hydropower would provide a heavy bonus share and cash dividend helped soar the hydropower sector’s index. Only two trading groups— Insurance Companies and Commercial Banks—witnessed a fall in their respective indices last week. The index of ‘trading’ group remained stable at 172.23 throughout the weekdays. The sensitive index that measures the transaction of the class ‘A’ companies increased by 0.59 points to close at 138.55 points. Among the individual companies, Nepal Bangladesh Bank topped both in terms of the number of shares and transaction amount. The bank witnessed a turnover of Rs 174.04 million through transaction of 489,899 shares over the period. According to stockbrokers, the bank’s higher equity transaction was fueled by the news that the ICFC, a Bengali group is on the verge of taking over the shares of NB Group in the bank. Chilime Hydropower Company, Nepal Credit _ Commerce Bank, Everest Bank and Kumari Bank are other companies that hit the list of top transaction amount. The capital market observed a 37.44 percent rise in the transaction worth during the review period. The total turnover of the market amounted to Rs 872.1 million, up from Rs 634.5 million in the previous week. However, the number of shares traded declined to 2,621,917 units as against 2,709,302 units. Transaction of ‘A’ category companies amounted to Rs 392.3 million, which was 44.99 percent of the total transaction amount. up after US growth data

System of collecting land taxes through banks to be extended

THE Department of Land Reform and Management (DoLRM) has been preparing to extend the system of collecting taxes through banks to another 15 Land Revenue Offices (LRO) across the country after it became a resounding success in the Kathmandu valley. Nepal Bank Limited and Rastriya Banijya Bank have been providing the service at the five LROs in the valley since the past eight months. Under the system, property owners can pay their land taxes and other fees at the offices of the two banks. According to the DoLRM, LRO offices in Sunsari, Bhadrapur, Biratnagar, Dhanusha, Parsa, Makwanpur, Chitwan, Kavre, Rupandehi, Kaski, Dang, Banke, Bardia, Kailali and Kanchanpur will come under the system in the near future. The department has made budget allocations to implement the scheme and asked its offices to make room for the bank outlets. “We have written to the Prime Minister’s Office (PMO) to call a meeting to discuss the plan. Since numerous government agencies are involved, we will have to get their approval to implement it,” said Kamal Prasad Timalsina, under secretary at the DoLRM. According to him, the DoLRM will have to acquire permission from the Office of the Attorney General, Ministry of Finance and Nepal Rastra Bank before launching the system. As the tax money collected by the LROs has to be shared with the district development committees and municipalities, coordination with them is necessary, said Timalsina. “This process takes two to three months. For this reason, we are serious about holding talks with the concerned authorities,” added Timilsina. According to him, the Citizens Charter, which requires compensation to be paid for failure to provide service, is in effect at the 20 LRO offices planned to be brought under the new scheme. “The system is already in place at the five LROs in Kathmandu,” he said. The implementation of tax collection through banks has many benefits for service vendors as well as service seekers. Amid growing complaints about financial fraud in the LROs, the move is likely to bring financial transparency and give some respite to the general public. “It is a convenient method for both the employees as well as the service seekers,” said Timilsina. “Due to lack of awareness, even neat and clean transactions in the offices have been mistaken as fraud. This system will bring such problems to an end.”

Disputes, lack of coordination among agencies hit road projects

DISPUTES over alignment, heavy demand for compensation and lack of coordination among government agencies have emerged as major problems facing implementation of road projects. Seti Highway, Postal Road, Mid-Hill Highway, Kathmandu-Tarai Fast Track road are some of the projects facing such problems. At a recent annual project review meeting at the Ministry of Physical Infrastructure and Transport (MoPIT), DoR officials said that it has been two years since they sought Department of Forest’s permission to cut down the trees and make way for alignment along the Tikapur- Achham stretch of the Seti Highway but without success. The highway links Achham, Bajura District and Bajhang and meet border of China. Tulasi Prasad Sitaula, secretary at the MoPIT, said problems in the Seti Highway and Postal Highway had emerged as the projects’ work was pushed in haste without completing the Environmental Impact Assessment (EIA). The delay in clearing the space for alignment falling in forest areas in eastern Kailai has prevented the contractors from opening a track of the Postal Highway. “Alignment dispute and land acquisition have become tough issues when implementing projects,” said Arjun Jung Thapa, deputy director general of the DoR.

Nepal maintains sixth place in world lentil output: FAO

NEPAL has retained its position as the world’s sixth largest producers of lentils in 2012 after it logged 0.64 percent rise in production to 208,201 tonnes, according to the Food and Agriculture Organization (FAO) of the United Nations. The FAO statistics show that Nepal’s production accounted for 4.57 percent of the world’s lentils in 2012. In terms of production, Nepal is behind Canada, India, Australia, Turkey and the US. The world lentils output grew by 3.32 percent to 4.55 million tonnes in 2012. Meanwhile, the area under lentil cultivation rose to 207,630 hectares last year from 207,591 hectares in 2011. It was cultivated in 187,437 hectares of land in 2010. Despite the increase in production, Nepal’s lentil export has fallen significantly and its price has gone up. The Trade and Export Promotion Centre (TEPC) statistics show that lentil export in the first 11 months (mid-July to mid-June) of 2012-13 dropped by 24.55 percent to 21,209 tonnes year on year. According to the TEPC statistics, the lentil price on an average rose to 121 per kg in 2012-13, against Rs 77 per kg in 2011-12. Nepal exported lentils worth Rs 2.57 billion in the first eleven months of the last fiscal year as compared to 33,151 tonnes worth Rs 2.67 billion it had exported in 2011-12. Bangladesh alone procured 29,579 tonnes of lentils worth Rs 2.45 billion while exports to India stood at Rs 193 million. Bangladesh is the largest buyer of Nepali lentils followed by India, Singapore, the UAE, and Bahrain. In 2008-09, Nepal made a record high lentil export of 56,767 tonnes worth Rs 5.66 billion. Lentils is among Nepal’s top 10 export commodities. Lentil traders and importers said spiralling price in the international market coupled with supply crunch as a major reason behind the rise in price of Nepali lentils. They warned of further rise in the lentil price because of the growing market demand. “Nepali traders are unable to fulfill lentil demand in Bangladesh,” said Ajay Parajuli, executive secretary at the Association of Nepalese Rice, Oil and Pulses Industry. “Although 80 percent of the total lentils produced in Nepal are exported, the existing output is too low to meet the international demand.” Lentils are produced in all the districts in the country except Manang and Mustang. Commercial production, however, is concentrated in the Tarai. More than 90 percent of lentil is grown in the region because of its favourable climatic and soil conditions. Masoor— with brown skin and orange gain—is the common variety grown in Nepal. TOP 10 LENTIL PRODUCERS IN 2012 Country 2011 (in tonnes) 2012 (in tonnes) Canada 1,531,900 1,493,620 India 943,800 950,000 Australia 379,659 463,000 Turkey 405,952 438,000 USA 214,640 240,490 Nepal 206,869 208,201 China 150,000 145,000 Ethiopia 80,952 128,009 Syria 112,470 115,000 Iran 98,516 100,000 (Source: FAO)

West Seti completion date pushed back further

INVESTMENT Board of Nepal (IBN) has said the much talked about West Seti Hydropower Project will be delayed by two more years, with CWE Investment, a subsidiary of power developer China Three Gorges Corporation (CTGC), demanding change in rehabilitation and resettlement modality of the project. IBN CEO Radhes Pant on Saturday said the CWE has now asked the government to take over tasks of land acquisition and resettlement of the project affected area although it had earlier agreed to carry out those tasks itself. A high-level official at the IBN said the CWE has been demanding more time—one and a half years—to complete the project. Energy Secretary Bishwo Prakash Pandit said the government is ready to take up works related to land acquisition and resettlement but the Chinese investor will have to bear the cost. As per the memorandum signed between the IBN and CWE Investment, the project is scheduled to be completed in 2019. The government will have to change the law to address the request of the Chinese investors and it will take time, said Pant. Speaking at a programme organised by GP Koirala Foundation, Pant said it would be tough to act as per the request of the Chinese company as the Nepali laws do not allow doing so. “The existing law should be changed if the government takes over the responsibility of acquiring land and managing resettlement,” he said. The existing Land Acquisition Act 1894 states that the government shall provide the land if it is under its ownership, while the private developer has to acquire the land on its own for any project development. Energy Minister Umakant Jha said as the West Seti project was the only remedy to end the ongoing power crisis, the government will make every effort, including the revision in law for the project implementation. The first memorandum of understanding (MoU) signed between the Ministry of Energy (MoE) and the Chinese company on March 1, 2012 had envisioned to initiate the project works from July 2014 and to complete by 2019. The revised MoU signed between the IBN and CWE on August 27, 2012 retained the same time frame with an understanding that the Chinese company will be given additional six months’ as compensation to make up for the time lost because of the interference into the project by then Natural Resources and Means Committee (NRMC). Pant said the IBN will soon hold a meeting with the CWE so as to discuss on a number of issues, including land acquisition and resettlement, optimitization of the project by making it a multipurpose one and to hold studies on seismic condition of the project site. “The earlier studies conducted by Australia’s Snowy Mountains Energy Corporation (SMEC) are not matured enough and separate seismological studies need to be done so as to ensure every safety of the project area,” he said, adding, “Once power development agreement (PDA) with the project is signed, both of us will have contractual obligations. So, all ground works should be cleared before signing PDA.” Pant also added that the CWE writing an official email to the IBN has asked the Board to come to China to discuss on those issues. “We will soon fix a date to hold a meeting with CWE officials in China,” he added. The IBN, however, insist that the preparations to develop the 750 MW storage-type project were under control with the possibility to implement the project successfully. “It is our mistake to realise the project overnight which has already been delayed by around two decades,” Pant said. The CWE has completed technical evaluation of the project on March 8 and financial evaluation on July 30, 2013. Speaking at the programme, Chinese Ambassador to Nepal Wu Chuntai said that the West Seti project as a milestone for Nepal-China relationship and that his government and the CWE were fully committed to realise it. He, however, stressed the need to take into account multidimensional aspects with regard to the field investigation, technical and financial evaluation and co-operation from local people. He also requested the Government of Nepal and all stakeholders to cooperate in the project implementation. “As the CWE has already asked the IBN officials to hold talks, the unsettled issues will be solved gradually,” he said. China has agreed to provide a loan worth $1.6 billion for the project development. The agreement between the IBN and CWE has ensured 10 percent equity to the local population in the Far West, allocation of 150 MW of electricity from the project to the region and multipurpose benefits from the project to the maximum extent economically possible. The agreement has also explored new possibilities of developing an industrial hub in the Far West with assistance from CTGC.

Universal, Calogi sign deal

KATHMANDU: Universal Tours and Travels has signed an exclusive distribution agreement with Calogi, the world’s fastest growing air cargo portal. The agreement provides Universal Tours and Travels access to Calogi’s range of e-freight business solutions, a statement issued by the company said. “As Nepal’s exports increase, the need for reliable, secure and simple cargo solutions will grow. Calogi’s online cargo solutions connect Nepalese businesses with freight forwarders, airlines and cargo handlers around the world, supplying the international demand for goods such as tapestries, garments, handicrafts, medicinal herbs and jewellery,” the statement said. “The Calogi portal also ensures imports into the country are managed with reliable, secure, simple, and cost-effective systems.” Calogi has 14 established distribution partnerships worldwide, and has relationships with companies in Europe, Asia and the Americas, supplying Nepal’s small-to-medium sized businesses with an expanded global reach.

Everest Bank CSR

KATHMANDU: As part of its CSR (Corporate Social Responsibility) initiative, Everest Bank has made arrangements for pure drinking water at Geta Eye Hospital situated in Dhangadi, Kathmandu. AK Aluwaliya, chief executive officer of Everest Bank, and Dr Suresh Panta, head of Geta Eye Hospital, inaugurated the new service amid a programme. The bank has said it is committed to work on several areas to increase the status of health, education and infrastructure sectors.

PRICES OF IMPORTS CLIMB ALONG WITH US DOLLAR

MARKET prices of imported products have been on an upward trajectory with the Nepali rupee sinking to all-time lows. Traders said a stronger US dollar had resulted in soaring prices of consumer goods like garments, edibles and electronics. According to Nepal Rastra Bank, the domestic currency has depreciated by almost Rs 18 in the last two months against the greenback. The Nepali rupee dipped to a record low of Rs 108.90 per dollar on Aug 29 compared to Rs 91.40 per dollar on June 29. Sachin Shrestha, brand manager at apparel store UFO, said prices of Chinese outfits had jumped 40-50 percent in the last two months. “Readymade clothes which were available at Rs 1,000 apiece now cost Rs 1,500,” said Shrestha. “Besides the rise of the US dollar, a global increment in cotton prices and hike in worker wages in China has also pushed up prices of apparels imported from China,” he added. This is the time traders place import orders for goods meant for the upcoming festive season. They said goods, particularly apparels and footwear, had started to enter the country from the Chinese market. Most of the demand for apparels and footwear is fulfilled through imports from China. Traders said that the goods imported for the festive season would be highly expensive. Meanwhile, household expenses are also swelling due to daily goods becoming costlier. Pavitra Bajracharya, president of the Nepal Retailers’ Association, said that edible oils, gram, green pea and white pea imported from third countries had become more expensive. “Big traders have started curtailing supply in anticipation of the dollar rising further,” he said. Supply constraints will lead to higher prices of essentials. The government has intensified market monitoring due to rising instances of malpractices. Sellers of electronic items have also been preparing to increase their prices. Akhil Gupta, director of SG Global, an authorised distributor of Sharp electronics, said they would be increasing prices by 5-10 percent from next week. Sales of electronic items also jump during the festive season. Meanwhile, automobile traders said that prices of vehicles imported from countries other than India were likely to go 12-20 percent.

Tourist arrivals expected to rise due to stronger dollar

THE country’s import sector may be watching the freefall of the Nepali rupee against the US dollar with hearts pounding, but the tourism industry is brimming with anticipation for a bumper season. With the exchange rate going in favour of foreign visitors, tourists get Rs 109 for US$ 1. The rate, if compared to the same period last year, means a 20 percent bonus to foreign visitors to the Himalayan nation. Travel trade entrepreneurs said that tourists would get more bang for the buck and expected higher numbers this tourist season that normally starts from mid September. The autumn-September to November-is the peak tourist season which offers highly pleasant weather for trekking and mountain views. Nepal sees 30-40 percent of the total tourist arrivals during the autumn season. “A stronger US dollar means an increase in visitors’ purchasing power. And this in turn will attract more tourists to Nepal, which has become one of the cheapest destinations for travellers,” said Hari Sarmah, chief executive officer of the Nepal Association of Tour and Travel Agents. The exchange rate was Rs 89 to the dollar during the same period last year. “The impact will also be visible on the country’s foreign exchange reserves.” According to Nepal Rastra Bank’s statistics, foreign exchange earnings from the travel trade sector jumped 11.4 percent to Rs 34.21 billion in the last fiscal year. Shibesh Shrestha, managing director of C _ K Nepal Travel and Tours, said that the appreciation of the dollar would not benefit travellers much who have already booked their trips for this season. “However, it will be a boon for free independent travellers and backpackers,” Shrestha said, adding that there would be a big surge in the number of independent travellers this season. Market watchers say it is high time to attract tourist from neighbouring countries as they are now looking for shorter trips and destinations which they can afford. AIRLINE WŒS With the onset of the tourist season, airline connectivity is likely to be a major setback. The request of the Civil Aviation Authority of Nepal (CAAN) to all international airlines flying wide-body aircraft to Kathmandu airport to restrict their take-off and landing weight is likely to be a big setback during the peak season. CAAN has issued a request letter to international airlines to restrict their payload to 196 tonnes until Sept 30 to prevent damage to the runway of the country’s sole international airport. This provision means, for example, Thai Airways which flies Bœing 777 aircraft has to offload almost 100 passengers from its aircraft to meet the aviation regulator’s obligation. “And the payload restriction request has come when the airlines’ major business season is almost at hand,” said Shyam Raj Thapaliya, managing director of Osho World Travel Nepal. CAAN has said that it has entrusted a Spanish company to prepare a runway evaluation study report by the end of Sept, and based on the report, further decisions will be taken to fix the runway problem permanently. Airlines and the travel trade sector wonder what further decision CAAN will take after the Spanish company submits its report. “An unexpected decision, if imposed, will have its impact on airline revenue and seat capacity this season,” Thapaliya said. COSTLY OUTBOUND According to tour operators, the strength of the dollar has made travellers, particularly Asians, to think twice about visiting destinations like Europe and the Americas. Suraj Vaidya, president of the Federation of Nepalese Chambers of Commerce and Industry, said it was high time Nepal launched promotional packages in India and China. “Due to the strength of the dollar, they will not prefer to travel to Europe and other long haul destinations,” he said, adding that the devaluation of the Nepali rupee would help tourism considerably if it was realized immediately. Tourism entrepreneurs said that longhaul travel is getting converted into short haul overnight, and it will benefit destinations who offer the cheapest rates.

NT launches four internet packages

NEPAL Telecom (NT) has launched four volumebased data packages under its Sky Pro service. The packages that are coming into effect from Sunday offer data service at Rs 0.23 to Rs 0.40 per MB. The packages — 500 MB, 2 GB, 5 GB, and 10 GB — will have a one-month validity period, according to NT. The 500 Mb package will cost Rs 200 excluding taxes. Similarly, 2 GB, 5 GB and 10 GB packages are priced at Rs 760, Rs 1,700 and Rs 2,400, respectively. Sky Pro service, also known as EVDO under NT’s IP CDMA project, allows customers to avail data service with speed up to 3.1 Mbps. “Packages will help customers benefit from cheaper internet service,” said Guna Kesari Pradhan, spokesperson for NT. She said Sky Pro RUIM can be used for both voice and data service in IP CDMA technology-compatible smartphones, desktops, laptops and tablet computers through a USB dongle. In a bid to promote Sky Pro, NT has also been selling USB dongle bundling with the RUIM card. NT said customers buying the bundled service get an EVDO dongle, talk time worth Rs 100 and 3 GB data with 3 months validity at Rs 2,200.

FNCCI urges CPN-UML to incorporate economic agendas in poll manifesto

THE Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has urged CPN-UML leaders to include the “common economic agendas” in the party’s election manifesto, prioritising employment and economic prosperity. The country’s apex business body had also made a similar request to the Nepali Congress (NC) three weeks ago. It plans to hold similar meetings will all major political parties, pleading them to put economic development at heart of their election manifestos. An FNCCI team, which was on Friday summoned at the party’s headquarters for their inputs to be incorporated in the manifesto, urged the UML leadership to prepare the party’s manifesto with focus on addressing unemployment, trade deficit, energy crisis, unequal development, weak infrastructure and corruption. “More than 415,818 youth left the country for foreign employment in last fiscal year alone. Migration of youth for foreign employment has caused scarcity of potential and trained manpower for industries, while agriculture development is weaker than ever,” states the 16-page FNCCI suggestion letter handed over to the party. The letter also includes short- and long-term strategies for development. The FNCCI urged the party to complete the 900-MW Upper Karnali Hydro Project in the Midwestern region; 750-MW West Seti Hydro Project in the Far-west; 600- MW Budhi Gandaki and 900-MW Upper Tamakoshi in the central region; 600-MW Upper Marsyangi Hydro project, Lower 400-MW Tarun, and 415-MW Upper Tamor Hydro projects in the Eastern region. FNCCI President Suraj Vaidya said the UML “seemed to be serious” on economic development and creation of an investmentfriendly environment. “To much relief for the private sector, UML leaders convinced that the scheduled polls will be held on November 19, and they will also fix a date of the budget presentation,” he said. UML Standing Committee member Bharat Mohan Adhikari said: “We have taken their concerns seriously and will do our best to incorporate them in our election manifesto and implement in future.” With the CA polls on the horizon, FNCCI has begun homework to convince political parties to include the private sector’s agendas in their election manifestos. In a rare gesture of political unity, top leaders of seven political parties had recently expressed their commitment to the country’s hydropower development and decided not to hinder work on any hydel projects. The political parties had made such a commitment on April 11 at the initiative of the FNCCI. “The political parties have committed promoting the economic agendas a number of times in the past,” said an FNCCI vice president. “This time, we want their commitments to be mentioned in their manifestos.”

Two foreign bourses propose working terms with Nepse

TWO foreign stock exchange companies — Korea Exchange and Singapore Exchange — have expressed interest in working as a strategic partner with the Nepal Stock Exchange (Nepse). Nepse said it is studying the proposal forwarded by these companies. Korea Exchange’s proposal seeks a 10 percent stake in Nepse. Nepse General Manager Sitaram Thapaliya said they are studying Korea Exchange’s system to know whether it will be compatible in Nepal’s case. Thapaliya, however, declined to provide details on Singapore Exchange, saying they have not yet received a detailed proposal from the company. “If found feasible in the preliminary study, we will hire a consultant and fix the ‘Terms of Reference’ for the selection,” he said, adding they plan to complete the preliminary study and issue a public notice to appoint a consultant by mid September. If a company is selected for strategic partnership, Nepse will receive the system and other technical support, while the company will take a stake in Nepse. Nepse has long been searching for a strategic partner as it has failed in terms of innovation and online trading. The existing system is not compatible even for new instruments like mutual funds, market makers, debt instruments and stock derivatives, among others. Following the government’s decision to divest its shares in Nepse, the latter has been pursuing privatisation for the last four and half years. The Ministry of Finance and the Nepal Rastra Bank have also asked Nepse to find a strategic partner so that the government could divest or transfer its shares. The government holds 58.66 percent in Nepse, while the central bank holds 34.60 percent. After appointing a strategic partner, Nepse plans to adopt a full automation system for stock trading. “Besides, it could also help introduce new products and promote bond trading, which is currently in poor state,” said Thapaliya. India’s software major Infosys recently forwarded a proposal for its stock exchange software. Thapaliya said they are holding consultations with government authorities concerned on whether to initiate talks with prospective strategic partners or purchase the system. “We are waiting a clear government policy.”

Indian company interested in equity partnership with HIDCL

INDIA’S OPG Power and Infrastructure Private Limited has expressed interest in investing in Nepal’s hydropower sector in partnership with the Hydrœlectric Investment and Development Company Limited (HIDCL). The company, which operates a few power projects in India, has committed $10 million in equity partnership with HIDCL. OPG had dispatched a letter to HIDCL on August 3 expressing its interest in investing in Nepal. OPG Director Dalip Dua also attended an international investors’ conference organised by HIDCL on August 28- 29, where he committed the investment, according to a HIDCL statement. “We agree to invest (after due diligence) $10 million in a project where HIDCL will do the syndication of fund, and be part of debt investment in a project,” read the letter signed by Dua. “We are happy to join as equity partner and can enter into cooperation agreement or memorandum of understanding.” HIDCL Chief Executive Deepak Rauniar said they will hold further discussions with OPG to determine the investment modality — “whether it wants to invest through HIDCL or as an independent partner having equity in the project”. This is the first time that any foreign private investor has agreed to join as equity partner with HIDCL. Government-owned HIDCL has been mandated to generate resources from both domestic and international markets to massively invest in the power sector. OPG is a captive power producer with an operating capacity of 270 MW. It operates three plants — 77- MW Chennai I and II and 80-MW Chennai III, according to its website. It also has investment in 25.4-MW Mayavaram and 10-MW Waste Heat Chennai. Other projects being developed by OPG are 160-MW Chennai IV, 300-MW Gujrat and 12-MW Bellary. Rauniar said other international investors also showed interest in investing during the two-day meet. The event was attended by investors from India, China, Japan, Korea, USA, New Zealand, Norway, Czech Republic, Australia, Russia and Bangladesh. Foreign diplomats, donors and Nepali government officials also participated at the meeting. The meeting was held to discuss 10 storage-type hydro projects each having capacity of more than 100 MW and generate resources for them. During the meeting, Asian Development Bank Country Director for Nepal Kenichi Yokohama expressed readiness to invest in storage- type projects. HIDCL has so far signed investment agreement for 42-MW Mistri Khola Hydropower Project and 27- MW Dordi Khola project. It is holding talks with commercial banks to inject funds into four other projects as well. The company currently has Rs 8.5 billion, most of which is deposited in banks.

NEA asks BoK for advance payment deposited by Korean contractor

THE Nepal Electricity Authority (NEA) on Friday asked the Bank of Kathmandu (BoK) to release the advance payment deposited by KHNP Consortium, a Korean joint venture assigned to carry out electromechanical and hydro mechanical work at the 30 MW Chameliya hydropower project, to it. After the Appellate Court, Patan quashed the petition filed by the Korean firm demanding that it be allowed to terminate the contract with the NEA on Friday, the government power entity wrote a letter to the BoK asking it not to release the contractor’s performance guarantee bond and to release the advance payment to the NEA. In the first week of August, KHNP had notified the NEA that it was breaking the contract one-sidedly saying that the project developer had failed to fulfil its demand. The Korean consortium had previously warned the NEA that it would walk out of the contract unless it was compensated for delays in civil works. The contractor had demanded US$ 8 million in compensation from the government as a prolongation cost. Subsequently, the company had also filed a petition at the Appellate Court, Patan asking the court to allow it to take back its performance guarantee bond and advance payment. The court scrapped the company’s petition paving the way for the NEA to seize its advance payment. “Following the court’s verdict, we have written a letter to the BoK asking it to release the advance payment amount to us and to not release the performance bond to the company,” said Lava Bahadur Ghimire, acting managing director at the NEA. Rajan Adhikary, the NEA’s legal advisor, said that as the period of advance payment would terminate automatically on Saturday, the NEA claimed the amount on Friday while the NEA will claim the company’s performance security later as it remains valid till Aug 31, 2014. The company has deposited performance security worth Rs 32.6 million and advance guarantee worth Rs 122.8 million at the BoK. Meanwhile, the NEA’s contract agreement with the Korean firm will terminate on Saturday. The company was awarded the Rs 3.8 billion (US$ 48 million) contract in April 2009 for electro-mechanical and hydromechanical works as well as the construction of transmission lines. Project chief Rajendra Manandhar, however, said the NEA was still ready to negotiate with the Korean firm to resolve the matter. “We are forced to initiate the process towards confiscating the contractor’s advance amount after it tried to prove itself innocent and secure its security amount through a court verdict,” he said. NEA acting MD Ghimire on Tuesday had written a letter to the headquarters of KHNP in Korea asking the chief to come to Kathmandu to hold dialogue by the second week of September. “We were waiting for the headquarters’ reply, but the company went to Court which prompted us to seize its advance amount,” he said. NEA officials said it was a mistake on the part of the Korean company to announce breaking the contract unilaterally and claim security of its performance and advance amount through the court at a time when it was holding dialogue with the government. After the company warned it would breach the contract in the first week of August, the NEA formed a dialogue committee under the coordination of Bibek Tated, an NEA board member. However, during the course of the negotiation, the company on Aug 14 dispatched a letter to the NEA announcing formally that it was breaching the contract giving 14 days’ prior notice. However, KHNP’s local agent said the NEA was to be blamed for the firm’s preference to walk out of the project. “Had the NEA provided the demanded prolongation cost, the firm would not have made such a decision,” he said, adding that the project has now become a subject of uncertainty. NEA officials blamed China Gezhouba Water and Power (Group), the project’s civil contractor, for the dilemma the project is facing. Civil works precede the electro-mechanic and hydro mechanical works and Chinese contractor China Gezhouba Water and Power (Group) has been engaged in the civil works. The South Korean contractor had complained that delays in the civil works had been holding them back from starting their share of the work in the project. The civil contractor is responsible for building the intake, penstock tunnel and powerhouse. The Darchulabased project, originally scheduled to be completed in May 2011, has been delayed due to the contractor’s poor performance. The project deadline, postponed till Aug 2013, was again pushed back to March 2015. NEA officials said that despite several revisions in the completion date, the Chinese contractor’s progress had been “unsatisfactory”. CHAMELIYA HYDRO PROJECT

Stock market up 7.86 points; hotels lead

NEPAL Stock Exchange (Nepse) last week rose 7.86 points to close at 548.40 points on Thursday. With the listed companies, particularly commercial banks, announcing huge profits in the last fiscal year, the stock market has witnessed increased investor interest lately. The market, which opened at 540.54 points on Sunday, maintained its upward momentum throughout the week. Stock analyst Rabindra Bhattarai said as usual, investors are expecting benefits after annual general meetings of listed companies at the beginning of the new fiscal year. “As a result, the index moved up with increase in investment,” he said. Six out of the nine groups posted growth. Hotels (up 24.88 points) led the gainers side. Others, Commercial Banks, Development Banks, Hydropower Companies and Finance Companies followed. While the trading group’s index remained stable at 172.23 points, Insurance Companies and Manufacturing registered posted losses. Bhattarai expressed hope that the market would maintain its upward trend in the coming days. He said growing number of institutional investors, such as mutual funds, has helped boost the secondary market. “However, the sustainability of the growth also depends on political changes that could take place in the future,” he said. The sensitive index that measures transaction of A category companies grew by 2.54 points to close at 138.11 points. Global IME Bank topped in terms of both the number of shares traded and transaction volume. The bank recorded transaction worth Rs 90.75 million from the trading of 709,006 shares. National Life Insurance Company, Chilime Hydropower Company, Lumbini Bank and Asian Insurance Company were among the top five companies in terms of transaction amont. The capital market, however, saw a 12.50 percent drop in the overall transaction. The market last week realized a turnover of Rs 634.5 million from the trading of 2,709,302 shares. In the previous week, the transaction amount was at Rs 676ð1 million from the trading of 2,071,930 shares. “A” category companies witnessed a turnover of Rs 271.4 million — 42.78 percent of the total transaction.

Petroleum continues to top import list; vehicles follow

NEPAL spent Rs 257.66 billion to import 10 commodities, including petroleum, vehicles and gold, in fiscal year 2012-13. These 10 commodities account for around 50 percent of the country’s total imports. As usual, petroleum continued to be the No 1 import item. In 2012-13, Nepal imported petroleum products worth Rs 107 billion — up 16.1 percent. In 2011-12, petroleum import bill was at Rs 92.25 billion. With automobile business bouncing back in the last fiscal year, import of vehicles and spare parts increased by a whopping 54.2 percent to Rs 26.29 billion. A total of 208,483 vehicles were registered in 2012-13, the highest so far in a fiscal year, according to Department of Transport Management. Vehicle registration had last crossed the 200,000-mark in 2009-10, when 201,787 automobiles were registered. Former president of Nepal Automobile Dealers’ Association Saurav Jyoti said the decline in bank interest rates on auto loans along with easy financing services helped boost the auto business, pushing up imports. Amid surge in the gold price, the country imported the precious yellow metal worth Rs 26.11 billion in 2013-

13, compared to Rs 25.77 billion in the previous year. With the establishment of more steel industries, import of MS Billet, a major raw material for steel production, has been continuously surging. In 2012-13, MS Billet imports rose by 14.77 to Rs 22.30. Imports of telecommunications equipment also posted a 59.52 percent rise amid telecom operators’ infrastructure expansion drive. Operators spent Rs 13.48 billion in the last fiscal year for the purpose. Despite an increase in the number of pharmaceutical companies and their expanded product portfolio, import of medicines continued to grow. Nepal imported medicines worth Rs 13.71 billion last year — up 28.42 percent. The official annual import data also throw some interesting facts. Reliance on cement imported from India hasn’t decreased despite growing number of Nepali cement factories. Cement imports surged by a whopping 185 percent in last year to reach Rs 9.42 billion. Among food items, rice imports almost doubled to Rs 8.45 billion, while import of vegetable surged by 75.7 percent to Rs 4.54 billion. Sugar imports saw a massive 967 percent rise. Nepal imported sugar worth Rs 1 billion last year compared to Rs 99 million in the previous fiscal year.

Petroleum sector needs competition: FinMin

WITH ensuring smooth fuel supply becoming a big headache for the government, Finance Minister Shankar Prasad Koirala on Saturday said the stateowned Nepal Oil Corporation (NOC) needs a private sector competitor. “If it is not done now, there will be more problem in coming days,” Koirala, who also holds the Commerce and Supplies portfolio, said inaugurating the 5th General Assembly of Nepal Petroleum Transport Entrepreneurs Federation. Admitting that petroleum has always been “a political commodity”, he said successive governments have not been able to address the sector’s problems due to problems like geopolitical risks and supply disruptions. Petroleum traders also requested the government to restructure the NOC by bringing in strategic partners from the private sector. They said private players are capable of investing as strategic partners if the government allows. Responding to the petroleum traders, Koirala said the government will look into those two alternatives. The government is also planning to reintroduce the Petroleum and Gas Transaction Orders to allow private players investment in oil trade. The Orders, which was scrapped earlier, is likely to be reintroduced with some amendments favouring private firms willing to invest in the petroleum business, according to government officials. On March 13, the government had published the orders in the Nepal Gazette, but it was forced to scrap it on April 6 following a flurry of criticism from petroleum traders and experts. A number of private firms, including a few big business houses, had expressed interest to invest in petroleum trade, oil processing, and exploration after the orders were issued for the first time. Nepal imported petroleum products worth Rs 107 billion last fiscal year — up 16.1 percent year-on-year. Meanwhile, despite motorists’ queues at refuelling stations since Friday, the NOC has said the market is not facing a short-supply. A senior NOC official said the “temporary” short-supply might be due to public holiday on Wednesday and Thursday. Around 700kl petrol and 620kl diesel was supplied to the market by NOC’s Thankot depot on Friday. “The NOC has not slashed supply,” the official said, but warned a “supply problem” might occur by August-end as NOC will be unable to buy sufficient fuel due to its losses. NOC’s monthly projected loss has ballooned to Rs 106.42 billion as per the tariff sent by Indian Oil Corporation on August 16. As the state-run oil monopoly has been subsidising petroleum products, its loans to the government and different banks and financial institutions stands at Rs 28.50 billion. “We have asked the government to arrange funds to finance petroleum imports to ensure sufficient supply during the festival season,” NOC officials said.

Local goons harassing contractors

CONTRACTOR Ram Sharan Deuja was starting work on developing a tourist information centre at the Pashupati Area Development Fund six months ago after being awarded the contract, but local goons disrupted the work demanding 5 percent of the contract amount — Rs 35 million. After he refused to pay the money, the thugs vandalized the settlement of workers employed for building the centre. Deuja also sought police help, but the goons were released in bail after two weeks and continued to harass the workers. Deuja was then forced to pay Rs 45,000 that the thugs had paid for bail. “I didn’t negotiate the payment with them (the goons), but they reached a deal with my subcontractor. After the payment, situation has been peaceful,” Deuja said, narrating how goons are harassing contractors. Deuja heads Shyam Sundar Nirman Sewa Private Limited. Until few years ago, goons and youth wings of the political parties would prevent potential bidders from taking part in bid to help their desired firms get contract. But after government offices adopted the e-bidding system, such a trend has largely vanished, according to contractors. The government started implementing the e-bidding system since 2007. The budget for the current fiscal year has provisioned that government authorities have to go for e-bidding for projects worth more than Rs 6 million. Not being able to influence the bidding process, the goons now are harassing contractors demanding money. “Many contractors fear exposing the goons amid the government’s failure to provide security,” said Deuja. According to contractors, if they refuse to pay the money, the goons even burn construction equipment. Federation of Contractor Association of Nepal President Jaya Ram Lamichhane said contractors have been facing harassment “heavily”, particularly in rural areas. “Usually, local goons having connection with big gangsters harass the contractors,” he said. “After the implementation of the e-bidding system, the thugs have shifted their focus on construction sites.” Deuja said contractors in Tarai and hilly areas are facing more intimidations at construction sites. Secretary at the Ministry of Physical Planning and Works Tulasi Sitaula also admitted that they have received such complaints. “Whenever we receive complaints, we have been asking the local administration to provide security to the project,” he said.

Drop in raw material imports points to industrial slowdown

THERE has been a massive decline in imports from India for which payment is made in US dollars. The drop points to a slowdown in industrial activity as US dollars are mostly used to pay for raw material imports. Nepal Rastra Bank (NRB) statistics show that such imports from India fell 34.58 percent to Rs 39.69 billion in the last fiscal year 2012-13. In the previous year, the country imported goods worth Rs 60.67 billion. The central bank has allowed payment to be made in US dollars for the import 401 products from India which it has classified as industrial raw materials. Payment for other imports has to made in Indian currency. NRB has implemented the system to permit Nepali industry to obtain raw materials at reduced rates from India as the Indian government provides incentives to exporters earning convertible foreign currency. Imports have dropped even though the central bank has enlarged the list of products that can be bought in US dollars. This is also the first time that imports against US dollar payment from India has come down in the last seven years since the peace process began. “We are surprised by the massive decline in imports from India bought with US dollars,” said Min Bahadur Shrestha, chief of the research department at the central bank. “We have not confirmed the reason with industrialists, but it may be the result of a worsening industrial environment in the country due to loadshedding, labour unrest and various other problems.” He added that reduced capacity utilization by manufacturers may be a reason why raw material imports have come down. According to the central bank’s study as of the first half of the last fiscal year, average capacity utilization by manufacturers based in eight major industrial cities was just 44.72 percent, down from 57.79 percent at the end of the previous fiscal year 2011-12. The eight major cities where the survey was conducted are Kathmandu, Biratnagar, Janakpur, Birgunj, Pokhara, Siddhartha Nagar, Nepalgunj and Dhangadhi. Economic Survey 2012-13 published by the Finance Ministry has estimated the industrial growth rate to be just 1.5 percent in the last fiscal year, a four-year low since its growth turned negative in fiscal 2008-09. Industrialists said that two factors seemed to be responsible for the decrease in raw material imports from India: One, the country’s worsening industrial environment and two, an increased tendency among industrialists to pay for imports in Indian rupees. Similarly, vice-president of the Federation of Nepalese Chambers of Commerce and Industry Pradeep Jung Pandey blamed the deteriorating industrial environment in the country for the decrease in imports. However, vice-president of the Confederation of Nepalese Industry Hari Bhakta Sharma said that besides the country’s industrial environment, a rising dollar and scrapping of the duty refund procedure (DRP) system had prompted manufacturers to import raw materials by making payment in Indian currency. “I have found many manufacturers switching to Indian rupees to pay for imports following the scrapping of the DRP system which reduced the advantage for making payment in US dollars,” said Sharma. The DRP system was scrapped in March 1, 2012. Before that, the Indian government did not charge excise duty on goods purchased by Nepali importers by paying for them in US dollars. Importers paying in IC had to pay excise duty which would be refunded later under the DRP system. Sharma said that many manufacturers also began paying for their raw material imports in Indian rupees due to fluctuations in the exchange rate of the US dollar in recent months.

MoI to forward Industrial Enterprises Act to Cabinet

THE Ministry of Industry (MoI) is all set to forward the draft of the Industrial Enterprises Act (IEA) to the Cabinet for endorsement. The government, which has accorded top priority to the umbrella act for industrial sector, plans to introduce it as an ordinance. The government plans to formulate the IEA to implement the industrial policy that was introduced three-and-a-half years ago. “The Industrial Enterprises Act will address most issues related to the industrial sector,” Industry Secretary Krishna Gyawali said. The MoI plans to send the draft to the Cabinet after incorporating opinions from all the ministries concerned and other stakeholders to the law ministry for a final word. “We plan to send the proposed Act to the Cabinet within next week,” said Gyawali. The MoI has taken feedback from ministries of Finance, Commerce, Labour and Home and the private sector. Issues incorporated in the proposed Act include facilities for sick industries to turn them around and provisions related to Special Economic Zones (SEZs). “We have also provisioned that no other Act will be applicable than this one in the industrial sector,” said Gyawali. “Such a provision was made amid complaints from the private sector about different definitions of different Acts on the same issue.” Sick industries will get relief through this Act. Two years ago, the Sick Industry Rehabilitation High- Level Taskforce headed by former National Panning Commission Vicechairman Dipendra Bahadur Kshetry had recommended the government to give easy exit measures to enterprises beyond rescue, a three-to-five-year package for rehabilitation, loans at low interest rates and tax exemptions, among other schemes. However, the government failed to implement the recommendations as they went beyond the existing Industrial Act. In the proposed Act, the government is also incorporating the issue of SEZ, although it was planned that a separate Act would be introduced for this. Earlier, the draft SEZ Act prepared by the Industry Ministry was opposed by the Finance and Labour ministries over taxation and labour relations. According to an industry ministry source, the ministry has provisioned income tax exemption for seven years inside SEZs.

NRB to study country’s gold demand in market

AMID complaints from traders that the quota imposed by the central bank on the daily supply of gold from banks is inadequate, Nepal Rastra Bank (NRB) Governor Yuba Raj Khatiwada on Friday said the central bank will conduct a study on the country’s gold market. Speaking at the inaugural ceremony of the first annual general meeting of the Federation of Nepal Gold and Silver Dealers’ Association (FENEGOSIDA), Khatiwada said the NRB study will find out the exact demand of the yellow metal and end speculations about the demands in the market. “We want the private sector to support us in conducting the study,” he said. NRB has allowed commercial banks to supply 15 kg of gold every day, while traders say the demand is over 40 kg a day. The NRB imposed the quota system in 2009 as it contributed to massive trade deficit. He, however, said the government cannot be flexible on gold import as long as the Indian government remains strict on it, given the high possibility of smuggling of the metal to India from Nepal. “The Indian government has controlled gold imports as it accounted to around 10 percent in the import volume of India,” said Khatiwada. “Under such circumstances, even allowing a supply of 200 kg a day here will not be sufficient.” Citing the upcoming festivals in the country, Khatiwada, however, said the central bank will soon increase the quota to 20 kg a day. FENEGOSIDA president Mani Ratna Shakya asked the government to allow traders to import gold as per their wish as, according to him, the current mechanism (getting it from the banks) is complicated. Although traders and individuals were allowed to import gold in the past, the central bank stopped that practice after the country’s balance of payment turned negative. Traders also expressed reservations on the government’s failure to introduce monitoring directives on gold trading. Due to protest from traders, the government had to stop monitoring the gold market, despite the fact that it had found many irregularities, including compromise on quality and sale of the metal through weighing machines that were tampered with. Vice- President of the FNCCI Bhaskar Raj Rajkarnikar urged the government to address the concerns of the traders.

1,500 visit Tata Car Mela

1,500 people participated in ‘Tata Car Mela’ organised at International Sports Council. The event which started on August 21 will run through August 24, 2013. Of the total, 700 individuals were involved in the test ride of Tata vehicles and 30 of them made bookings of several model of Tata four-wheelers. A statement issued by Sipradi Trading Pvt Ltd, the sole authorised distributor of Tata vehicles in Nepal said that the company witnessed overwhelming response and that they were bound to add one hours of time on the closing day. During the event, visitors were imparted knowledge about Tata vehicles by the trained man powers.

TELCOS, ISPS SLUG IT OUT FOR SLICE OF DATA SERVICES PIE

With the number of smartphone users growing fast, telecom companies have been aggressively pushing attractive packages in data service, making it harder for ISPs to compete in the market NCELL and Nepal Telecom (NT) dominate the country’s data service (internet) market. According to the latest report of the Nepal Telecommunications Authority (NTA), the two telecom giants hold a 50 percent and 48 percent share of the market respectively. NTA statistics show that there are around 7 million internet subscribers in the country. Easy access to GPRS service, tariff cuts, increased trend of using smartphones, social media craze among youngsters and increasing ICT knowledge have led to a significant growth in the number of data users. Ncell has over 3.4 million subscribers in data, using services like GPRS, EDGE and 3G internet in mobile. Meanwhile, NT has a total of 3.2 million customers in data service. NT’s date service is offered through ADSL, WiMax, EDVO, dial-up, GRPS, EDGE and 3G. With the number of smartphone users growing fast, telecom companies have been aggressively pushing attractive packages in data service, making it harder for ISPs to compete in the market. Ncell started an aggressive pricing and marketing strategy making it the leader in the data segment also. Ncell’s data package ranges from 3 MB to 10 GB. Of late, NT has also been moving up with the launch of WiMax. The state-owned company has also launched an offer for users of Sky Pro where customers paying Rs 2,359 can get a 5 GB package, USB dongle and RUIM card. There are around three dozen ISPs operating in the country, but their growth in the data service business compared to telecom companies is very slow. Of the total market for data, ISPs have a 1 percent share with 85,821 plus customers, as per the NTA. Meanwhile, president of the Internet Service Providers Association of Nepal Binay Bohara blamed poor infrastructure and weak access to wireless service for preventing ISPs from moving ahead aggressively. In a bid to regain the market share lost to phone companies, the country’s leading ISPs—Worldlink Communication, Vianet, Subisu Cable Net and Classic Tech—have slashed prices for internet service. ISPs that had turned mainly to the corporate segment for service expansion are now making a comeback among household customers by offering high speed and quality service at competitive rates. “With the surge in demand, many ISPs are now targeting individual users rather than focusing on corporate clients,” said Bohara. To attract new customers and take on the telecom giants, ISPs have also launched different volumebased packages for mobile internet where prices are fixed on the basis of different packages. According to the scheme, “the bigger the package bought by customers, the less the cost for data”. The new aggressiveness shown by ISPs has eventually benefited common consumers. With the new offers from ISPs, prices have declined and there are a range of services to choose from based on the size of one’s budget and the required connection speed and data volume.

Ncell launches 'Nagadhma Gadh-Gadh' scheme

Ncell has launched a new scheme called Ncell Nagadhma Gadh-Gadh, which will be effective from August 26. According to the telecom company, the scheme, which last for ten weeks, offers Ncell customers with a chance to win attractive gifts, including Rs 1 million, every week. The company further said that scheme enables 100,000 Ncell customers to win Rs 50 worth of bonus balance and another 100,000 customers to win 50 free SMS every week. According to the scheme, every week, the customer will receive a ticket number via SMS for every Rs 50 that they spend from the main balance in that week. If such weekly spending stands at Rs 100, the customer will get two ticket numbers. According to the company, the scheme is open for all Ncell prepaid and postpaid voice customers. “The new scheme is our special offer to our customers this festive season. We believe this will make using Ncell´s quality services still more exciting for our valued customers,” said Milan Mani Sharma, corporate communication expert at Ncell. The lucky winner of Rs 1 million for the week will be declared through a lucky draw which will be held live on Kantipur Television every Tuesday, said the company.

Weakening Nepali currency affects import from China

Customers are likely to be compelled to buy costlier commodities during the upcoming festive season as the import of low-price goods, especially from China, has been badly hit by the weakening Nepali currency against US dollar. The entrepreneurs involved in import of low-cost goods from Tibet and other parts of China are in the ´wait and see´ mood. The Nepali customers, especially from the low-income groups, rely heavily on the Chinese goods during the great Hindu festival of Dashain. But, the warehouses in the Tibetan border town of Khasa are empty after the Nepali entrepreneurs chose to cut the order heavily fearing a huge loss in trading in the face of the weakening Nepali currency against dollar. The import from the northern neighbor has already been cut by two-thirds as the importers are still waiting for the Nepali currency to stabilize against dollar. “We do not feel confident to place order for the Chinese goods due to the growing value of the dollar. We don´t want to risk our investment,” said Chairman of Sindhupalchowk chapter of the Federation of Nepalese Chambers of Commerce and Industries Rajendra Kumar Shrestha. The exchange rate of the dollar against the Nepali currency was fixed at Rs 103.5 on Thursday, giving continuity to the bullish trend of the greenback since the last month. With the increasing value of the dollar, the Nepali currency is also loosing against the Yuan. The exchange rate of the Yuan against the Nepali rupee now stands at Rs 17, up from Rs 13 some two weeks ago. Nepalese traders usually import the Chinese products from the cities such as Guangzhou and Shanghai besides the Tibet, and it takes about three weeks for the products from the mainland China to arrive in Nepal once the order is placed. The major products imported for Dashain include garments, shoes, cosmetics and decorative goods.

Sauraha to get a facelift

Domestic and international tourists will soon find better facilities in Sauraha as the stakeholders are chalking out a master plan for the popular tourist destination in Chitwan. Different associations such as the Regional Hotel Association of Sauraha, the Restaurant and Bar Association of Nepal (REBAN), Sauraha chapter, and the locals are working on the ´Sauraha Tourism Master Plan´, which is estimated to cost around Rs 45 million to Rs 60 million. “The master plan includes widening of the roads by two meters on each side, development of tourist bus park, effective drainage to keep roads dry during the rainy season, development of green belt on both sides of the roads and installation of streetlights, among others,” said Narayan Bhattarai, president of the Hotel Association. Currently, the locals and the hoteliers have jointly collected the money and the association said that it will now seek help from different private and the governmental organizations. According to Suman Ghimire, general secretary of the association, of the total estimated budget, around Rs 5 million will be spent for the green belt development alone as tourists have always been attracted by the greenery of Sauraha. “We have already spent around Rs 800,000 for the development of the green belt,” said Ghimire, adding that they aim to carry out plantation of 200 plants before the great Hindu festival of Dashain. Most of the hoteliers and locals of Sauraha have provided their private land to widen the road by two meters on each side which has made the road widening work easier, said the association. REBAN, Sauraha chapter has taken the initiative for installing the streetlights in 1.5 km road section, which is rather dark and difficult to walk during the nighttime. According to Ghimire, around 16 streetlights will be installed 100 meters apart. “For the time being the REBAN plans to operate the streetlights using inverters, but in the near future we will be using solar power to cut down the cost,” said Ghimire. Besides the ongoing development activities, people visiting Sauraha will also get to see new hotels and resorts. A two-star hotel named ´Seven Star´ is coming into operation at the beginning of September. Likewise, four more new hotels are coming up by October, according to the association. Green Park, Landmark, Sutanchuli and Central Park are the new hotels which are all set to begin operation from October. With the addition of new hotels, Sauraha will have around 90 hotels altogether. As Sauraha is mostly focused on safari-based tourism, hoteliers are hopeful that the new changes in Sauraha will help lure more tourists.

Many US companies interested in Nepal's hydro sector

Embassy of the United States in Kathmandu has stated that many American companies have expressed interest to invest in Nepal´s hydropower sector. Although challenges remain, US Ambassador Peter Bodde, during a conference call with the American businesspersons, pointed out that Nepal has the second-largest hydropower resources in the world and that less than one percent potential has been tabbed so far. According to a press statement issued by the embassy on Friday, Ambassador Bodde had conferred with the US businesspersons on energy and infrastructure sector and had given an overview of the economics and business climate in Nepal. Then he took participants´ question, including queries about upcoming hydropower summits in Kathmandu. Independent Power Producers´ Association, Nepal and Hydroelectricity Investment and Development Company Limited are organizing separate power conferences next week to draw the attention of the investors to Nepal´s largely untapped energy sector. Twelve participants, representing energy and infrastructure industries, including some with a history of investing in Nepal, had participated in the conference call. The US Embassy also pledged of the assistance to the American companies interested in investing in Nepal.

Toyota Etios hits Nepali road

United Traders Syndicate (UTS), the authorized distributors of Toyota Cars in Nepal, have launched their latest global car - Toyota Etios- in the Nepali market.

Amid a program in the capital on Friday, Suraj Vaidya, president of UTS and Koji Nagata, general manager for the Middle-East division of Toyota Motor Corporation jointly launched the new product. According to the company, Toyota Etios boasts the comfort of the rider with premium interiors, ergonomic steering wheel, superb suspension, comfortable seats and virtually anything that one may expect in a segment defining a car. Vaidya said that the company has always taken pride in bringing the best and latest products for its customers. “For that, we have brought in Toyota Etios, which has all the latest features and values you associate with Toyota,” Vaidya said. According to Nagata, the new Etios is the result of core investigation of customer´s need in different kinds of roads in different urban settings. “The new Etios delivers the high quality for which Toyota is famous at a very affordable price,” said Nagata. According to Nagata, Etios leads its class in both fuel efficiency and acceleration. Nagata added, “As Etios incorporates family safety features, one can enjoy their ride safely.” According to the company, the engine specifications of Toyota Etios are same for Nepal and India. The new vehicle incorporates 1.5- liter four-cylinder DOHC petrol engine, producing peak torque of 90 PS @ 3000 rpm. The Etios´ 1.5-Lt engine will be mated to the 5- speed manual transmission and its fuel efficiency is 16.78 Km/L, said the company. The Etios that features 185/60 R 15- inch alloy wheels, ABS and dual airbags is priced at Rs 34,45,000 in the Nepali market.

Extend income tax holiday period: Large power developers

The developers of four mega hydropower projects have sought five-year extension to the grace period for income tax holiday and VAT rebate on three construction materials -- penstock pipe, steel and cement. SN Power, GMR and Satluj Jal Vudyut Nigam (SJVN) have sought five additional years for tax holiday from the seven-year grace period that ends in mid-April 2019. Talking to this daily, Mukunda Paudyal, joint secretary of the Investment Board Nepal (IBN), said the issue of income tax holiday has stalled the process of signing Project Development Agreement (PDA), which is at final last stage, with four mega projects -- Arun III, Upper Marsyangdi, Upper Karnali and Tamakoshi III. The PDA is a definitive document that sets out all obligations by the government and the developer to ensure that the interests of both parties are protected and well served for the duration of the 30-35 year concession period. Taking into consideration the fact that these projects can´t be completed within 2019, the IBN has forwarded the power developers´ demand for grace period extension to its board. The government had announced seven-year grace period for income tax holiday through the annual budget two years ago. It had also discount 50 percent discount in income tax for the next three years for those hydro projects completing before mid-April 2019. It had also one percent customs duty and rebate of VAT on penstock pipe, steel and cement used for the projects. “The issue will be presented at the board meeting of IBN next week,” added Paudyal. The IBN Board is headed by Chairman of the Interim Election Council Khil Raj Regmi. The government had announced the tax holiday package three years ago in order to motivate the developers to complete projects in time, taking into consideration the deepening energy crisis in the country. Hydropower developers generally pay 20 percent income tax. India´s GMR is developing two of the four projects - Upper Marsyangdi (600 MW and Upper Karnali (900 MW), while SN Power and SJVN are developing Tamakoshi III (650 MW) and Arun III (900 MW), respectively. Paudyal said PDA talks with the developers will be completed within two months after the income tax holiday issue is sorted out. Earlier, the government had announced 10-year income tax holiday and 50 percent discount in income tax for another five years for projects completing within mid-April 2015. However, people in the hydropower sector had criticized the incentives, saying that it favored only the small power developers. According to Poudyal, the Arun III and Upper Karnali projects will enter the construction phase once the PDA is signed as both the projects, which are promoted by Indian firms, plan to sell power to India.

Wide-body planes asked not to exceed 196 tons

Civil Aviation Authority of Nepal (CAAN) has requested international airlines operating wide- body aircraft in Nepal to limit their landing and take off weight to 196 tons if possible. A meeting Friday of CAAN officials and officials of the Airline Operator´s Committee Nepal (AOCN) and international airlines operating wide-body aircraft in Nepal came up with three major decisions, of which limiting aircraft landing and take-off weight to 196 tons till the end of September, if practicable, will be a major step. Currently, Air Asia, Korean Air, Thai Airways and Dragon Air are operating wide-body aircraft to Nepal. Similarly, Etihad Airways, Qatar Airways and the incoming Turkish Airlines plan to operate wide-body aircraft from the beginning of September. “We have come up with three major solutions: limiting aircraft landing and take-off weight to 196 tons, requesting Korean Air to change its flight times as it does not have any alternative to its Boeing 777s, and likewise requesting Thai Airways to use Airbus 330-300 instead of Boeing 777 if possible till the end of September, as measures to prevent further damage to the runway,” said Dinesh Prasad Shrestha, general manager of Tribhuwan International Airport (TIA). CAAN said it will come up with a permanent solution after Ayesa Ingenieria, a Spanish consultant, submits its TIA tarmac evaluation report. Bharat Kumar Shrestha, chairman of AOCN, said that the conclusions of Friday´s meeting will not affect the airlines much and they will also prevent further damage to the tarmac. “A special request has been made to Korean Air and Thai Airways as they have been operating Boeing 777s and their landing time is almost the same, which has been one of the reasons for damage to the tarmac,” said AOCN Chairman Shrestha. CAAN has made a special request to Korean Air to change its flight timing if possible as it does not have an alternative to its Boeing 777s and it is not possible for it to limit its landing weight and take-off weight to 196 tons. According to AOCN, the Boeing 777 operated by Korean Air has a dry weight of 146 tons and when it carries 51 tons of required fuel, the weight increases to 197 tons. Hence, the minimum weight it can maintain is 223 tons provided it carries a total payload of just 26 tons. Likewise, Thai Airways has been requested to change aircraft as it has alternatives to the Boeing 777. AOCN said that as Thai Airway flights to Nepal are of short duration, they can reduce the weight by 15 to 20 tons by refuelling in Kathmandu itself for the return flights. “The request made to wide-body operators on Friday is just a temporary measure and we will come up with a permanent solution once we receive the report from the Spanish consultant by the end of September,” said CAAN general manager Shrestha.

'Visit Malaysia Year 2014' eyes 28m tourists

Tourism Malaysia and Malla Travel and Trek Services of Nepal are making early preparations to make Visit Malaysia Year (VMY) 2014, which targets to attract 28 million tourists to the South East Asian nation, successful. According to a press statement, as a prelude to Visit Malaysia Year 2014, many fascinating events and festivals such as the F1 Petronas Malaysia Grand Prix, Colours of Malaysia, the Malaysia International Shoe Festival, the Malaysia Contemporary Art Tourism Festival, the Malaysia Mega Sale Carnival, and the Malaysia International Tourism Night Floral Parade, among others have been lined up. "There are numerous reasons tourists will find Malaysia an irresistible must-visit holiday destination of which some are to experience marvelous natural wonders and impeccable warm hospitality while others will simply enjoy the shopping and urban experiences," a statement issued on Friday, said. " Tourists visiting Malaysia will be attracted by the rich and colorful multi-cultural heritage, delectable cuisines, great mountains and rivers, lush green parks and gardens, idyllic tropical islands, palm-fringed beaches and million-year-old rainforests among others." Malaysia also offers visitors various tourism products that embrace the concept of luxury such as spa vacations, golfing holidays, wedding and honeymoon destinations, duty-free shopping sprees and helicopter tours among others.

Qatar Airways awards trade partners

Osho World Travel bagged the Gold Award 2012/13 at the Qatar Airways Agents Award Night 2012/13 held on Thursday. According to a press statement issued by the Doha-based carrier, Yeti Travels bagged Silver Award 2012/13 while Megabyte Travels & Tours took home Burgundy Award 2012/13. Sushil Ghimire, secretary at the Ministry of Culture, Tourism and Civil Aviation; Ratish Chandra Lal Suman, director general of Civil Aviation Authority of Nepal (CAAN); and Qatar Embassy Counsellor Abdul Nasser Abu Alfain gave away the awards, the statement said

NEPAL’S POPULAR WINES TO HIT MARKET IN JAPAN

HAVING enjoyed a firm foothold in the domestic market, the manufacturer of ‘Dada Ghare Wine’ has started exporting various alcoholic products to Japan. The brand has been one of the best-selling items in the local market for the last five years of its establishment. Jhalak Thapa, proprietor of Hill Hot Winery Company, said they agreed with Tokyo-based Neo Net Corporation two weeks ago for exporting their products on regular basis. Neo Net is the company run by a group of Nepalis residing in Japan in association with their Japanese partners. Thapa said they had already exported some cartoons of wine twice in the last two months in Japan. “Based on the market’s positive response to the products, we have reached an agreement with the Neo Net,” he added. According to him, they were even planning to sell their products in South Korea and Spain. ‘Dada Ghare Wine’ is prepared out of herbs found in the wild. Aagan, Majheri, Pindhi and Aaty are other popular products under the brand which are being exported to Japan. According to Thapa, an estimated 5,000 Nepali restaurants are currently in operation in Japan, out of which 700 are located in Tokyo alone. While the company can produce 1,000 litres of wine daily, it is currently producing 600 litres. Thapa said the company was planning to add more infrastructure and manpower to keep up with the growing demand for their products. The company manufactures wine out of herbs, honey and fruits like grape and apple. A bottle of Aaty is priced at Rs 685, Majheri at Rs 525, and Aangan and Pidhi each retails for Rs 385. Established with total investment of Rs 22.5 million, the company has been providing jobs to 22 people. As per the international standard, the beverage containing alcohol below 15.5 percent volume is not recognised in alcoholic drink. According to Thapa, their products contain 12.5 percent alcohol. Meanwhile, the company is launching a new wine ‘Tagaro’ in the market soon. The new product, prepared from combination of spices, herbs and honey, is expected to contain 22 percent alcohol. “We are planning to introduce ‘Tagaro’ by Dashain.”

BIRD FLU DEALS ANOTHER BLOW TO RESTAURANTS

AVIAN influenza has dealt another blow to Kathmandu’s restaurant business already suffering from a fall in patronage due to a crackdown against drunk driving. Outbreaks of bird flu in various parts of the valley have led to a government ban on the sale of chicken, discouraging city dwellers from eating out. Restaurateurs said business had dropped 15-25 percent of late. According to the Restaurant and Bar Association of Nepal (Reban), chicken items make up 80 percent of the non-vegetarian menu in local restaurants. Chicken is popular among local diners as it is cheaper than other meat products. In addition, chicken has gained more fans as people have been switching to white meat from red meat due to health concerns. “The campaign against drunk driving had led to a 50 percent drop in business for restaurants, and the current situation has worsened the situation,” said Reban Secretary Ram Gurung. According to him, restaurants targeted at the local people have been affected more. “Restaurants targeted at foreign visitors have been affected the least as they offer mostly pork and other meat items instead of chicken,” he added. The government has imposed a ban on the supply and sale of poultry products after bird flu cases were found at several poultry farms in Kathmandu and Bhaktapur. Since July 16, when the first cases of bird flu were reported, the authorities have culled chickens worth Rs 2 billion in the valley. Following the ban on chicken, many restaurants have now started considering fish and mutton as alternatives. According to Reban, many restaurants have started offering new fish and mutton items on their menus which are also popular among local meat lovers. Meanwhile, a number of restaurants have started offering dishes prepared from frozen chicken. With prices of goat, fish and packaged chicken rising, production costs have soared for the valley’s restaurants. Gurung said prices on restaurant menus could increase 10-20 percent due to rising production costs. He added that the outbreaks of bird flu would have no adverse effects on the tourism business. Reban Vice-President Pramod Jaiswal said bird flu outbreaks had resulted in a downward trend in the restaurant business. Jaiswal, who also operates Mela Restaurant _ Bar at Lainchaur, said they had to be satisfied with a lower profit margin as raising prices would be a bad idea. According to him, chicken dishes are the main items on the menu for a large number of restaurants in the valley. Jaiswal said the number of people visiting restaurants had dropped marginally due to bird flu. He expected business to pick up with the onset of the festival season. “If the fear of bird flu is completely removed, we are hopeful of regaining our business by Dashain,” he added.

Telcos’ subscriber growth rate hits three-year low

TELECOM companies’ subscriber growth rate hits a threeyear low in last fiscal year that witnessed just 23.38 percent rise in the total customer base as against 31.3 percent growth in 2011-12. Six telecom companies roped in 4.03 million new customers in the last fiscal year. The Nepal Telecommunications Authority (NTA) statistics show telecom companies had added 4.11 million users in 2011-12. NTA officials blamed several factors, including market saturation, delay in implementation of big projects by Nepal Telecom (NT) and operators’ reluctance to expand their services to rural areas, for the decline in the subscribers’ growth. “There is heavy growth in service operation in urban areas but such service has not been expanded in rural areas as expected,” said Ananda Raj Khanal, director at the NTA. He added that the market would see good growth in rural areas in the coming years with more players coming into GSM segment. At the end of the last fiscal year, the total number of telecom subscribers touched 20.13 million, of

which majority are GSM mobile users. Of the total customers, around 19 million are users of GSM mobile service being offered by Ncell and NT. The subscriber base of Ncell has reached 10.5 million and stateowned NT’s reached 9.17 million by the end of the last fiscal year. During the one year period, Ncell added 2.17 million customers, while NT attracted 1.42 million. With a user base of 753,000, Smart Telecom has emerged as the third largest telecom company. Smart added 357,264 users over the review period, while United Telecom Limited (UTL) added 81,696 customers taking its total subscriber base to 719,000. Similarly, Nepal Satellite Telecom and CG Communications (formerly known as STM Telecom Sanchar) reported subscriber base of 149,000 and 5,385 respectively. According to the NTA officials, the number of voice and data users will start to grow from the current fiscal year with NT starting to provide new lines under its projects 10 million GSM mobile lines and Smart preparing to go nationwide with mobile service. They said that Ncell too, as part of its service expansion, was working on expanding capacity for 2G and 3G services across the country. A higher demand for data has led both Ncell and NT to focus on data service besides the voice.

In sign of tourism upturn, hotel projects attract huge investments

HOTEL projects have been attracting massive investments from both domestic and foreign investors in what could be termed an investment frenzy in the country’s tourism sector. In the last fiscal year, the government received investment commitments for 65 hotel projects that will add 3,036 beds to the country’s tourist accommodation capacity. This list dœs not include big projects, mainly four-star and five-star hotels. According to the Department of Industry, the planned undertakings have a combined investment pledge of Rs 7.11 billion, half of it from foreign sources. What makes the latest surge in investments remarkable is that the country’s established business houses that have been staying away from the hospitality sector are increasingly getting involved in tourism. Some of the country’s well-known conglomerates such as the Golyan Group, TM Dugar Group and Chaudhary Group are pouring billions into the hotel sector. The Nepal Hospitality Group (NHG), a subsidiary of the MS Group, has signed a management agreement with a subsidiary of Marriott International to open a four-star hotel dubbed Fairfield by Marriott Kathmandu. The proposed 10-storey hotel under construction in Thamel will have 108 rooms. The property is spread over two and a half ropanis of land. The investment is estimated to be worth Rs 650 million. The TM Dugar Group is planning to open a 40-bed hotel The Centurian Hotel in Biratnagar with an investment of Rs 50 million. Similarly, the Golyan Group has planned to open a 224-bed hotel in Kathmandu with an investment of Rs 750 million. A decade-long insurgency coupled with labour unrest had compelled a number of star hotels to shut down operations. Four-star properties like the Woodlands, Yellow Pagoda, Narayani, Blue Star, Sherpa and Durbar closed down. “There were no major investments in hotels till Jana Andolan II,” said Suman Pandey, one of the promoters of Chhaya Centre where a five-star hotel is being proposed. The investment boom actually started three years ago when the government decided to celebrate 2011 as Nepal Tourism Year. Against a backdrop of sustained growth in international arrivals, the government’s announcement worked as a catalyst spurring investments in the tourism sector that had declined during the decade-long Maoist conflict. “Nepal Tourism Year 2011 sent positive vibes to potential investors,” said travel trade entrepreneur Yogendra Sakya. The increment in tourist arrivals in the last few years has attracted substantial foreign investments in hotels and resorts. According to the Department of Industry, a total of 33 foreign investors have pledged investments in hotel projects with capacities ranging from 10-200 beds. These planned ventures have 100 percent foreign investment. There were 18 proposals for hotel projects that are joint ventures between Nepali and foreign investors. Among the foreign investors, Chinese tops the chart with investment proposals for 24 hotels. In the past, a number of hotels in Nepal were operated under franchises and chains. However, they began to disappear and the hotels found themselves increasingly at a competitive disadvantage. The Travel and Tourism Competitiveness Report 2013 published by the World Economic Forum (WEF) has ranked Nepal sixth in price competitiveness in the travel and tourism industry. According to the report, Nepal offers the second most competitive hotel prices in the world after Gambia. Nepal’s average room rate calculated for first class branded hotels over a 12-month period in 2011 was US$ 52.7. Travel trade entrepreneurs have blamed the devaluation of the Nepali currency against the US dollar and unhealthy competition as the cause for Nepal becoming a price competitive destination. Now, a number of international franchises and chains are back and some new brands are making their way into Nepal. With all things looking good, Sakya said that the government should become serious to promote Nepal. “There has been a significant rise in the number of hotels, and in such a scenario, if tourist arrivals go down, it will be another setback,” said Sakya. This will, in turn, force hotels to go for tariff under-cutting measures, which used to happen in the past, forcing a number of players out of the business.

Jumla fixes price of organic apples

Price of organic apples produced in Jumla has been fixed. Though most of the organic apples produced in the district have already been supplied to the market, the Organic Apple Standardization Main Committee, Jumla has set the price of certified organic grade ´A´ apples at Rs 35 per kg. Similarly, prices of grade ´B´ and grade ´C´ apples have been fixed at Rs 30 per kg and Rs 25 per kg, respectively. Karna Bahadur Kathayat, horticulture development officer at District Agriculture Office, Jumla, said prices of uncertified organic apples have been set at Rs 30 per kg for grade ´A´, Rs 25 per kg for grade ´B´ and Rs 20 per kg for grade ´C´. “Though we had set prices for only grade ´A´ and grade ´B´ apples in the past, we have fixed the price for grade ´C´ apples this year as most of the good apples have already been sent to the market,” said Kathayat. Farmers said they sold apples before they were ripe enough for the market fearing that the apples would rot in the orchard if they do not get transport subsidies from the government. They had started supplying apples to the market from mid-June itself. “Only the farmers close to the power center get subsidy,” Anipal Bohara, a farmer, complained. According to Bohara, most of the farmers even do not know about the subsidies. According to farmers, they supplied apples to different districts, including Kathmandu, at an average price of Rs 25 per kg. “Had we waited for the standard rate, our apples would have decayed in the orchard itself,” a local farmer told Republica. Farmers in the district have so far sold more than 100 tons of apples. According to conservative estimate, apple farming is done in 2,303 hectares in Jumla.

Investment promotion, trade facilitation tops Nepal's agenda

Nepal is raising around half a dozen trade issues, including investment promotion, simplification of quality certification and quarantine checking process for exportable Nepali goods, at the upcoming foreign secretary level meeting with China to be held in Beijing next week. Foreign Secretary Arjun Bahadur Thapa is leading the Nepali delegation in the ´10th meeting of the Consultation Mechanism´ that begins in the Chinese capital on August 26. “Most of the economic issues that we are raising in the Beijing meeting are similar to those which were discussed at the recently held Nepal-China trade talks in Kathmandu,” a senior official at the Ministry of Commerce and Supplies (MoCS) told Republica. The Ministry of Commerce and Supplies (MoCS) recently forwarded the agenda for the meeting to the Ministry of Foreign Affairs. The joint-secretary level 4th Nepal-China-Tibet Trade Facilitation Committee (NTTFC) meeting was held in Kathmandu on August 11-12. In the meeting, Nepal and China had agreed to activate the joint working group led by customs chiefs of both the countries to resolve issues emanating in bilateral trade. “Some of the issues have already been agreed at NTTFC meeting, while some need to be discussed at the central government level. We are raising all trade related issues at the upcoming meeting,” a source at MoFA said. Nepali officials have put time harmonization between customs of the two countries, simplification of quarantine process, and recognition of quality certification issued by Nepali laboratories for Nepali exportable goods to the world´s second largest economy as the major agenda in the meeting. Traders have been facing difficulties in clearance of goods through the customs points due to difference in office hours between the two countries. The NTTFC had failed to reach to a conclusion on issues related to development of trade infrastructure, including upgradation of Kathmandu-Tatopani road and construction of Inland Container Depot in Rasuwagadhi, and opening up of a branch office of Chinese bank in Nepal. “Issues which have not been finalized will be extensively discussed with the central government officials at the Beijing meeting,” the source added. At the NTTFC meeting, Chinese officials had assured Nepali trade officials that issues which were not finalized in the meeting would be brought to the notice of the central government. Besides theses issues, Nepali officials are also seeking the support of China in bringing down the yawning trade deficit between the two countries. Nepal has been failing to take benefit of the big market in China though the northern neighbor has been offering duty free access to 7,831 Nepali goods. Limited number of exportable goods on the back of prolonged industrial slowdown has weakened Nepal´s supply capacity. According to Trade and Export Promotion Center (TEPC), Nepal´s export to China increased by a whopping 137 percent to Rs 1.99 billion during the first 11 months of the current fiscal year, while imports increased by 33 percent to Rs 63.13 billion. Nepal suffered trade deficit of Rs 61 billion with China during the review period. Trade deficit with China stood at Rs 46 billion in the same period last year. Deepak Dhital, joint secretary at the MoFA, also said the meeting will be focused on economic issues with promotion of trade and investment in hydropower, tourism and agriculture in Nepal by China high on agenda. Meanwhile, a high-level source also said Chinese officials would propose Nepal to sign Bilateral Investment and Promotion and Protection Agreement (BIPPA).

AOCN seeks a separate SOP to deal with runway problems

The Airlines Operator´s Committee Nepal (AOCN) has highlighted the need to develop a separate Standard Operating Procedure (SOP) for effective coordination and planning to deal with runway problems at the Tribhuvan International Airport. The meeting of representatives of international airlines operators in Nepal, specially those operating wide-body aircraft, held here on Wednesday came to a common conclusion that a separate SOP, which will create a standardized system by means of which the airlines can prepare themselves when runway problems emerge, is needed. “The SOP emphasizing all the aspects for preparation such as flight management, passenger handling, safety enhancement, informing flight crew about the problem, responding to the situation, among others, should be made so that all the airlines can prepare themselves accordingly,” Bharat Kumar Shrestha, chairman of AOCN, said. Currently, Air Asia, Korean Air, Thai Airways and Dragon Air are operating wide-body aircraft for Nepal flights. Similarly, Etihad Airways, Qatar Airways and the upcoming Turkish Airlines plan to operate wide-body aircraft from September. According to officials, any restriction to the operation of wide-body aircraft on Nepal flights will suffer Korean Air the most as it is impossible for it to operate narrow-body for a long flight of eight hours. “Though we are working on payload reduction to reduce load on the runway, it is not the permanent solution as airlines will have to incur huge loss if they have to deduct the number of passengers, including baggage, cargo weight and fuel weight,” said Shrestha. Shrestha added that SOP is needed immediately as even the timely information about the problem in the runway can minimize the loss to the airlines as they can find solution to the problem. At a time when operating cost of airlines has been increasing due to rise in fuel prices and increment in charges of various facilities by CAAN, airlines operators say they will have to bear extra loss due to runway damage as pilot have to be paid for extra flying hours when kept on hold or diverted along with extra fuel consumption. Shrestha said that AOCN is preparing a report about best possible ways that will not have high impact on wide-body aircraft operators. It will submit the report to CAAN on Friday. Airlines operators said their respective head offices will decide whether or not to operate flights to Kathmandu should their operating cost increases.

Sharif for Nepal-Pakistan cooperation in energy, tourism, agriculture

Pakistani Prime Minister Nawaz Sharif has said Nepal and Pakistan can promote mutual cooperation in energy, tourism and agriculture sectors by allowing private sectors of both the countries to take the lead. At a meeting with Nepali delegation led by Finance Minister Shankar Prasad Koirala, Sharif expressed happiness that the relation between Nepal and Pakistan has remained intact, sustained and fruitful despite political upheavals in both countries. The Nepali high-level delegation was in Pakistan for a two-day ´Nepal-Pakistan Joint Economic Forum´ meeting that concluded in Islamabad on Tuesday. At the meeting, Nepal and Pakistan signed an agreement to promote mutual investment in agriculture, tourism, trade, education and health sectors. Recalling his Nepal visits, Sharif expressed confidence that such high-level visits will help to consolidate the bilateral relation. He also said consecutive governments have been promoting private sectors though government led by former Prime Minister Zulfikar Ali Bhutto had taken the policy of nationalizing the private properties. On the occasion, Koirala stressed the need to effectively implement common policy for both the governments to promote private sector. Stating that Nepal-Pakistan Joint Economic Meeting has paved the way for forming bilateral economic agenda, Koirala said increased investment in trade was needed to give more benefits to people of both the countries. He also underlined the need to organize bilateral trade fairs on regular basis and added that the Nepal government was focused on implementing the programs that make positive impact in national economy. Koirala´s Pakistani counterpart Mohamad Ishaq Dar said the meeting was successful and expressed hope that the understanding reached at the meeting will be effectively implemented. Nepali ambassador to Pakistan Bharat Raj Poudel, joint secretary of Ministry of Foreign Affairs Kali Prasad Pokharel, joint secretary of Ministry of Finance Madhu Kumar Marasini, former president of Nepal Chamber of Commerce Surendra Bir Malakar and vice president of Federation of Nepalese Chambers of Commerce and Industry Pradip Jung Pandey, among others, were in the Nepali delegation.