Private sector demands clear economic commitments in political parties’ election manifestos

CR Bhandari

KATHMANDU: With candidate nominations completed for the February 21 elections, political parties have intensified door-to-door campaigns while simultaneously preparing their election manifestos. As the campaign gains momentum, pressure is mounting from the private sector and banking experts for parties to place economic development—and clear policy commitments—at the center of their electoral agendas.

Although Nepal Rastra Bank (NRB) is the regulatory authority for the banking and financial system, experts argue that government policies, budgets, and programs have a direct and decisive impact on the sector. As a result, they say, political parties must clearly articulate their economic and financial-sector vision in their manifestos and consult with banking professionals and the central bank during the drafting process.

Rajesh Upadhyay, Senior Vice President of the Confederation of Banks and Financial Institutions Nepal (CBFIN), urged parties to focus on strengthening the overall economy rather than narrowly targeting the banking sector. “Looking at banking in isolation is a limited approach,” he said. “If the overall economy is strong, banks and industries will automatically become resilient. When economic policy is robust, there is no need to constantly look toward monetary policy for relief.”

Upadhyay stressed that a strong Ministry of Finance would naturally enable NRB to function effectively within that policy framework. He called on political parties to present economy-centric manifestos that restore public confidence. “The government must bring clear policies to strengthen the economy. Election slogans should place development at the core. Political debate has gone on long enough—this is the time to bring the economy to the center of the manifesto,” he said.

He also emphasized that politics should be treated as a means rather than an end. “We have failed to upgrade ourselves through politics. Politics is a tool; development is the goal. But we have made politics itself the objective. Political parties must now be ready to correct this mindset,” he added.

Banker Gyanendra Dhungana said political parties should coordinate closely with the Bankers’ Association of Nepal and NRB while drafting their manifestos. Despite ample liquidity in the banking system, he said the absence of clear policies on channeling funds into development spending has become a major constraint.

“Remittance inflows are increasingly being converted into deposits, and excess funds are accumulating even at the central bank,” Dhungana said. “Manifestos must clearly outline how this capital will be mobilized into development through large-scale infrastructure projects.”

He stressed that parties must explicitly commit to welcoming and protecting private capital. Referring to recent incidents such as attacks on private businesses during youth-led protests, Dhungana said all parties should clearly state that they will not allow disorder, will safeguard private investment, and will support an open economy.

Dhungana criticized what he described as a tendency to rely on vague socialist slogans and populist promises. “Simply saying we will increase old-age allowances or expand health insurance is not enough,” he said. “What is needed is a concrete roadmap showing how the country will be developed over the next 15 years.”

He added that all parties should commit to channeling foreign direct investment and remittance income into long-term development, while ensuring peace and security for banks, financial institutions, industries, and the broader private sector. He also called for clear manifesto commitments on bringing cooperatives under strict regulatory frameworks, strengthening supervision, restructuring the microfinance sector, and expanding financial access for farmers and low-income groups.

Himalayan Bank Chief Executive Officer Ashok SJB Rana said political parties must present clear agendas to revive economic activity, which remains sluggish. He said manifestos should include commitments to increase government and capital expenditure and accelerate large infrastructure projects.

“Economic activity has virtually stalled,” Rana said. “Our expectation is that the government formed after the election will introduce policies that boost economic growth.” He cited green financing as an example, noting that while banks are expected to finance electric buses, the government has yet to present a clear framework for green finance.

Rana also said long-term economic plans should be clearly stated in party manifestos, adding that past elections saw limited emphasis on economic agendas and weak engagement with the private sector. He raised concerns about increasing political attacks on the banking sector, calling for the issue to be addressed as a political agenda.

He noted that a sharp decline in land prices has left borrowers under stress, while banks are struggling to sell non-banking assets acquired through loan recovery. “Even selling land is not enough to repay loans. This has created the current stress, with overall economic activity frozen,” Rana said.

Rana emphasized that the banking sector is operating within existing laws and regulations. “Banks are being made an election issue to attract votes. It is important for everyone to understand the reality,” he said. He recalled that expectations of elections stimulating banking activity were not met in the previous polls, though recent studies suggest investment may pick up after the election depending on the incoming government and the industrial environment.

Former banker Pashuram Kunwar highlighted the need for private-sector-friendly economic policies and the institutional autonomy of Nepal Rastra Bank. He said the banking sector primarily supports the broader economy, making the government’s economic policy the most decisive factor.

“The government decides the direction of the economy,” Kunwar said. “If the private sector is viewed with suspicion and controlled excessively, the central bank will be forced to adopt similar restrictive policies. If liberal economic policies are introduced to promote the private sector, NRB will also facilitate accordingly.”

Kunwar argued that political parties should clearly commit, in their manifestos, to safeguarding NRB’s autonomy. He pointed to legal provisions that allow the government to issue directives to the central bank, noting that institutions such as the IMF have criticized these provisions as compromising independence. “These need to be corrected so that there is no government interference in the central bank,” he said.

He described NRB as an advisory and supporting institution to the government but stressed that it should remain free from political interference. He also warned against excessive micro-management by the central bank, noting that over-regulation stifles innovation in a sector that is itself part of the private economy.

Kunwar said that although liquidity in the banking system is currently ample, weak credit demand has prevented lending from expanding. “Banks can only lend when there is demand. Creating that demand is the role of fiscal policy, which is why parties must clearly spell out their agendas,” he said.

He added that narratives portraying the private sector as inherently problematic must change. “The idea that the private sector must be controlled is flawed. The state’s role is to ensure fair competition, regulatory compliance, and consumer choice—not to crowd out private enterprise,” he said.