First Business News Portal in English from Nepal
KATHMANDU: The way is open for the Securities Board of Nepal to grant stock exchange licenses to corporate houses. After the Council of Ministers approved the ‘Securities Market Operation Regulations, 064′ sent by the Board after amendment, the way has been opened for the Board to grant stock exchange license to the private sector.
Two weeks ago, the board had revised the regulations and sent them for approval so that the stock exchange license could be given to private limited companies. Sources in the Ministry of Finance said that the same regulation was approved by the cabinet meeting on Tuesday.
“Three revised regulations related to securities market, registration and issuance and share broker business operations have been approved,” said the source. Currently, only banks, financial institutions, securities traders and listed organizations are allowed to invest in the securities market. Accordingly, private limited companies cannot invest in the stock exchange.
The same provision was modified and the private limited company was also sent by adding provision to invest in the exchange. The same regulation has been approved by the Council of Ministers. The board claims that it is open to all, private and public, as it is not good to give investment opportunities only to certain sectors.
On the orders of Prime Minister Sher Bahadur Deuba and Finance Minister Janardan Sharma, the board has started distributing licenses to exchanges. For this reason, the source claims that it was approved directly by the Cabinet without discussion in the Ministry of Finance.
Former Chairman of the Securities Board of Nepal and former Governor of Rashtra Bank Chiranjeevi Nepal is accused of bringing a new exchange to rob small investors. He says that now, rather than the development of the market, they are trying to rob small investors and bring down well-run, profit-making public institutions.
Since 15 years ago, various groups have been taking initiatives to bring a new stock exchange in Nepal. This process starts every time a new government comes. The private sector is burying its eyes in the stock exchange not for the development of the market, but for robbing small investors,” he said. “Earlier, such initiatives were taken when Congress, UML, Maoists were in government. At that time it was stopped for various reasons. That group now appears to be resurfacing. It should be stopped.’
He said that there is no reason to add in Nepal at a time when exchange companies are merging all over the world. There are only 2 exchange companies in India with a population of 1.38 billion. He argues that there is no need for 2 exchanges in Nepal where the population is not even 30 million.
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