Entrepreneurs associated with the Confederation of Nepalese Industries (CNI) urged for a major role of the Ministry of Industry (MoI) in the rapid industrialization of the country. Without a strong MoI industrialization is not possible, said CNI president and Constituent Assembly member Binod Kumar Chaudhary in an interaction here today.
CNI is feeling that the Ministry of Finance (MoF) is dominating MoI, he said. "The new industrial policy should break old traditions," he said. MoF's economic laws like value added tax (VAT), excise duty, customs duty and income tax are hampering industrial growth. "The new industrial policy should guarantee facilities available in India and China," said Chaudhary. India and China have been providing special discount in taxes for industries. The rate of tax exemption varies from industry to industry. Export-oriented and cottage industries are getting more benefit from these two governments.
CNI's suggestions include a target-based industrial policy along with other ideas. "We should target to double our industrial production in five years," Chaudhary said. For this, CNI has asked government to provide security and power supply as per demand.
Land acquisition is another issue where CNI is seeking the government's direct involvement. Indian provinces like Bihar and Uttaranchal of India are providing land for industrial endeavours through official acquisition process. CNI also urged MoI to conduct industrial census every five years. "We are ready to help," Chaudhary said.
According to CNI, the new industrial policy should make necessary provisions for high-seas (trade of goods when it is in the ship at sea), economic diplomacy for export promotion, timely revision of regulations, sick industry policy and `no work, no pay' provision. CNI has proposed five per cent customs duty on raw materials, 10 per cent on semi-processed and 15 per cent on products manufactured in Nepal.
Moreover, CNI has proposed three -- general, product specific and geographical -- kinds of economic zones. In income tax, CNI has proposed 20 per cent tax limit.
Industries operating under the new policy should have 50 per cent tax exemption for five years.
CNI has also sought its representation in the high-level investment board. The government has set up a high-level investment board under Prime Minister Madhav Kumar Nepal.
Addressing CNI members, MoI secretary Pratap Kumar Pathak said that the ministry will develop the Department of Industries (DoI) as a problem solving body as soon as possible. "DoI will hear the problem in the field and solve it in time thereafter," he said. He promised to incorporate CNI's suggestion in the industrial policy.
Minister for Industry Mahendra Prasad Yadav said political stability was a must for industrial growth. "However, MoI cannot wait for it. We will do whatever is possible in the present conditions," he said. He promised to include CNI's suggestions for the new policy. Development of the industrial sector is my prime concern, Minister Yadav added.
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