The Nepali tourism sector is prominently affected as the country has been forced to stay in lockdown for over four months, especially during the main spring season.

According to the Minister for Culture, Tourism and Civil Aviation Yogesh Bhattarai, the Nepali tourism sector has incurred a loss of NPR 60 billion due to the pandemic.

Speaking at a virtual meeting on the resumption of the tourism sector organized by the Confederation of Nepalese Industries (CNI), Minister Bhattarai said that Nepal has faced a massive loss from international and domestic tourism due to travel bans and other steps taken by the government to contain the pandemic.

“It has been a daunting task to restore the lost economy as the coronavirus pandemic incurred a loss of NPR 60 billion in the tourism sector,” exclaimed Minister Bhattarai.

He said that the Tourism Ministry is continually approaching the Finance Ministry and the Nepal Rastra Bank for an economic package to restore the tourism industry.

ALSO READ: Visit Nepal 2020 Tourist Arrivals

Meanwhile, other members at the meeting also raised some suggestions regarding the revival of the tourism sector.

CNI President Satish Kumar Moore suggested that the Nepali Government should resume the tourism sector and civil aviation services by adopting appropriate health measures.

Also Read: Foreign Exchange Rates in Nepal

Likewise, CNI member and Chairman of Shree Airlines Sudhir Mittal suggested that both international and domestic flights should be resumed to restore the economic loss caused by the pandemic.

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CNI and its organizing partner Bishal Media Group (BMG) announced this in a press meet on
January 24, 2019.

Under the theme ‘Federal Nepal: Opportunities for Investment and Growth’, the organizers aim to promote the entrepreneurship landscape of Nepal through the Summit.

The Summit will identify key areas of focus to promote entrepreneurship and create sustainable and substantial economic drive.

The event also envisages to build a strong network among small, medium and large entrepreneurs boosting them to work for innovative environment in the economy and also address gaps in the existing laws to promote rapidly-evolving business landscape of Nepal.

The Ministry of Finance and Ministry of Industry, Commerce and Supplies are also supporting the Summit that will see President Bidhya Devi Bhandari, Prime Minister Khadga Prasad Oli and Finance Minister Yuba Raj Katiwada as distinguished guests.

Besides, Industry Secretary Yam Kumari Katiwada, Entrepreneur Upendra Mahato and CEO of Nabil Bank Anil Kesari Shah are going to be the key speakers at the event.

As part of the event, government authorities from all the 7 provinces are going to present current scenario of entrepreneurship culture and opportunities in their respective areas.

“This will help the government to formulate necessary policies to encourage entrepreneurship at the local level,” CNI said in a statement.

CNI further informed that the Summit will also be an encouragement to Nepalis working abroad to return home and work for the nation as an entrepreneur.

“Growth of entrepreneurship plays an important role in the economic growth and overall development of the country. Thus, entrepreneurship should be promoted at the local level itself,” says CNI President. 

Nepal Entrepreneurship Summit 2019 Highlights

Session 1: Provinces- Fostering Investment and Job Opportunities
Session 2: Developing Entrepreneurial Ecosystem
Session 3: Bridging the Gap between Idea and Funding
Session 4: Journey to Success – Leading for Change

‘Industrial Excellence Center’ Soon

Speaking on the occasion, CNI President Hari Bhakta Sharma said the confederation is also planning for the establishment of ‘Industrial Excellence Center’ to aid research environment in the country, conduct training programs for entrepreneurs and finally minimize Nepali economy’s dependency on remittances.

“We will aim to solve the issues at hand regarding brain-drain, technical deficiency, social outlook on businesses and entrepreneurs,” says Satis Kumar More, Senior Vice-President of CNI.

President Bhandari Stress on Investment in Nepali Youth

The much-discussed Entrepreneurship Summit unfolded on February 14, 2019 in Kathmandu, Nepal.

A number of government officials, youth entrepreneurs, industry leaders and venture capitalists from Nepal, India, China and Singapore among others attended the summit.

Nepal President Bidya Devi Bhandari inaugurated the summit aiming to create networking platform for start-ups and small and large scale enterprises, promote new talents, technology and innovation alongside entrepreneurship and building a conductive business environment for operation.

Speaking at the occasion President Bhandari said that Nepal should promote entrepreneurship to create employment opportunities within the country so that a lot of Nepalis don’t be dependent on jobs abroad.

A total of 358, 815 Nepalis left the country for foreign employment in the last fiscal year 2017-18!

Furthermore, 113, 390 Nepali already left for employment abroad in the first six months of the current fiscal year as per statistics from the Department of Foreign Employment.

The President also emphasized on investing in youth with fresh ideas, building an investment friendly environment, promoting vocational education and training to promote entrepreneurship in Nepal.

Engage Nepali Youth to Address Trade Deficit: Bhandari

Directing attention to the country’s increasing trade deficit that has majorly affected Nepal’s foreign exchange reserve, she underscored the promotion of exports using domestic resources and Nepali youth’s skill.

Nepal Minister for Industry Commerce and Supply Matrika Prasad Yadav said that Nepali government was dedicated towards creating an investment friendly environment to encourage domestic production and boost exports.

“We are amending a number laws and policies to promote investment,” Prasad said during the inauguration session of the summit.

The day-long event covered talks by start-ups and venture capitalists and special talks by entrepreneurs from the various countries, start-up show cases and exhibition, networking sessions and workshops.,

Also Read:

• Start-up, SME Business Trend Take-off in Nepal

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Addressing the 51^st Annual general meeting of Makawanpur Chamber of Commerce and Industry, she opined that the private sector would lead Nepal towards prosperity and development.

In this regard, she called on the entire Nepali business community and entrepreneurs to take charge of the economic prosperity of the country.

“The under-construction fast-track and Nijgadh Airport are major catalysts of development in the District. Makawanpur has a big scope of tourism development,” she added.

Here it is noteworthy that the Nepali private sector had, earlier in November 2017 announced its wish list for the new Nepali Government.

Private Sector Wish List

In its wish list to the next Nepali administration, the Nepali private sector community had sought fight against corruption, cut in bank interest rates, and the promotion of small and medium enterprises and quality tourism.

Top on priority of the wish-list was a clear road map to avoid double taxation for more private sector investment.

“The private sector is expecting a commitment from the political parties that they will urge the government to prioritize the economic agenda. Entrepreneurs seek a clear provision to avoid multiple taxation while paying taxes to the local, provincial and central governments under the new federal system,” Rana said in an economic dialogue organized to release the wish-list.

“There is a need to tap private sector investment by ensuring an investment-friendly environment,” left leader Khadga Prasad Oli said in a statement while promising removal of multiple taxation system if left forms the next Nepali government.

Fund Crunch, A Key Concern

Meanwhile, fund crunch in Nepal’s Rastra Bank (NRB) (over a period) is resulting in high interest rates for the Nepali private sector community.

According to NRB, the central bank has halted issuing loans because of the excessive money lending during the first five months of the current fiscal year that began in mid-July 2017.

Most of the banks have already reached the 80 percent loan-lending limits and are charging high interests for the new loans to manage the resources, particularly to the institutional depositors.

This move by the central bank is creating a concern for the country’s industrialists.

“Due to dramatic rise in interest rate, the production costs of industries is set to rise which will put Nepali products into competitive disadvantage against imported goods,” the Confederation of Nepalese Industries (CNI), an apex body representing medium and large sized industries in Nepal said in a statement.

According to CNI, unpredictability of interest rates will also hurt the private sector investment.

“The excessive lending of banks and the government’s failure to spend its budget well so far are mainly responsible for current liquidity crunch,” says NRB Spokesperson Narayan Prasad Paudel.

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The Government of India said this in its Gazette notification on October 27, 2017, wherein, it announced the removal of GST on supply of its services to Nepal and Bhutan in case of payments made in the Indian currency.

Though GST is not applicable on export of goods and services, it was exempted only for the payments that involve convertible foreign currencies.

With this, the cost of service exports involving cargo handling, transportation and container freight station became costlier. This turned into a burden for Nepalis, who usually transact with the Indian service providers in the Indian currency.

Following this, the Government of Nepal and the country’s private sector sought GST exemption on Indian service exports to Nepal.

In response, in the last week of September 2017, the Indian Government announced GST removal on Indian services involving transit operations such as shipment, transportation, insurance, container freight station and cargo handling charges, among others for Nepal and Bhutan.

Transit and cargo handling are among the major service imports Nepali traders get from India.

Decision Positive for Nepalis

According to Hari Bhakta Sharma, President of the Confederation of Nepalese Industries (CNI), the removal of GST would save Rs 10 billion per year on service imports for Nepali traders.

Rabi Shanker Sainju, Joint Secretary at the Ministry of Commerce Nepal, opines that the decision makes it easier for Nepali and Bhutanese traders to transact in Indian currency, which is widely circulated in both the countries.

The recent amendments to GST rules on the recommendation of GST Council of India will boost service exports from India to Nepal, Sainju added.

It’s noteworthy that the Nepal Rastra Bank also encourages Nepalis to make payments in Indian currency.

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