Fiscal Nepal
First Business News Portal in English from Nepal
KATHMANDU: The government has formally presented the Third Amendment Bill to the Nepal Rastra Bank Act, 2083, in the Federal Parliament, aiming to enhance the autonomy, accountability, and institutional strength of Nepal’s central bank.
Presenting the proposal in Parliament, Finance Minister Dr. Swarnim Wagle said the amendment has been introduced to address long-standing reform needs in the Nepal Rastra Bank Act, 2058, and align the country’s financial governance framework with international best practices.
According to Wagle, discussions on reforming the central bank law have surfaced repeatedly over the years but failed to reach a conclusion. He said the latest push for amendment is linked in part to Nepal’s commitments under international financial agreements, particularly with the International Monetary Fund.
The Finance Minister noted that Nepal received financial support of USD 43 million under the IMF’s Extended Credit Facility (ECF) program and that implementing agreed structural reforms is necessary as the country moves toward the final phase of the facility.
He emphasized that the proposed amendment is also intended to honor Nepal’s international commitments while strengthening the country’s financial sector and regulatory framework.
A key objective of the bill, according to Wagle, is to provide greater operational independence to Nepal Rastra Bank, allowing it to formulate and implement monetary policy without undue interference in its day-to-day functions.
The minister acknowledged concerns over past practices in which governors were allegedly appointed based on political proximity or removed when governments found them inconvenient. He argued that legal safeguards must be strengthened to prevent such interventions and ensure that the central bank can operate independently as a credible and professional institution.
“The intention is not to reduce accountability but to ensure that the central bank can perform its core responsibilities free from political influence,” Wagle told lawmakers during the parliamentary session.
The government believes the amendment will improve the institutional capacity, transparency, governance standards, and accountability mechanisms of Nepal Rastra Bank, ultimately contributing to macroeconomic stability and a stronger financial system.
The bill will now move forward for parliamentary deliberation, where lawmakers are expected to debate provisions related to central bank governance, the appointment and removal process of senior officials, and measures aimed at safeguarding monetary policy independence.
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