Finance Minister Surendra Pandey assured investors of including their suggestions in the coming budget
“The government is committed to create an investmentfriendly environment,” he said while inaugurating a workshop on ‘Stock Market Development in Nepal: Issues and Challenges for Reform’, organised by Nepal Investors’ Forum here today.
Presenting his paper, Prof Dr Bijaya KC said, “Stock market size, liquidity, concentration and volatility are indicators for measuring the rate of stock market development,” he said adding that the relationship between various attributes of the stock.
market and economic growth of nations has developed a set of indicators in these categories to conceptualise the nature of such relationship. Commenting on Prof KC’s paper, Dr Chiranjivi Nepal, former chairman of Securities Board of Nepal (Sebon), said international research has shown that economic growth is directly related to the stock market. “The paper missed three major indicators like asset price effect, regulatory and international development and conglomerate index,” Dr Nepal said.
According to the study, Nepal’s stock market falls in the under-developed category among a 41-nation study. Though the number of investors, shares and listed companies has increased in recent years, Nepal’s stock market is grossly inflated. It has no direct relationship with real economic growth. “The share prices go up if there is economic growth,” he said adding that in Nepal the share prices are going up but the factor is not supported by economic growth as the gross domestic product (GDP) is going down.
Rewat Bahadur Karki, former general manager of Nepal Stock EXchange (Nepse), and Deepak Kafle, former chairman of Sebon, also offered their respective comments on the paper. Earlier, welcoming the participants, Nepal Investors’ Forum general secretary Rana Keshav Pradhan complained of government apathy towards the stock market.
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