Private sector pledges support for economic revival

KATHMANDU: The private sector has pledged its full cooperation with the government in the reconstruction, rebuilding and revival of the economy. This commitment was made by representatives of the private sector during a discussion with the newly appointed Finance Minister, Rameshwar Khanal, at the Ministry of Finance on Tuesday. The government has already established a fund for reconstruction, assessing the damages incurred during the recent protests.

“We have also suffered losses,” stated Chandra Prasad Dhakal, President of Federation of Nepalese Chambers of Commerce and Industry (FNCCI). “We are ready to work collaboratively, supporting ourselves as we rise and assisting the government.”

Dhakal further advised the finance minister on establishing a continuous dialogue mechanism between the private sector and the government for economic restoration and good governance. He also emphasised ensuring an environment where businesses can operate confidently and openly, and suggested extending the deadline for tax submissions.

FNCCI had previously requested an extension for submitting tax returns due on the Bhadra 25. Newly appointed Finance Minister Khanal made a ministerial decision on Tuesday to grant a one-month extension.

During the same discussion, Anjan Shrestha, Senior Vice President of FNCCI, suggested that the private sector could also provide support for reconstruction through its Corporate Social Responsibility (CSR) funds.

In the meeting, they drew the government’s attention to the fact that Nepal is preparing to graduate from Least Developed Country (LDC) status in 2026. They highlighted that the recent damages could create further complications, especially given the current unpreparedness. Bangladesh, facing similar issues, is reportedly seeking to postpone its graduation decision to avoid losing trade facilities. Nepal also needs to act promptly on this matter.

FNCCI President Dhakal urged for loan restructuring and rescheduling facilities for businesses affected by the protests, and for tax exemptions, including income tax, to attract investment. He also noted the youth’s demand for efficient government services and stressed the need for everyone to strive for the optimal use of information technology and ethical practices.

“At this juncture, reducing the Value Added Tax (VAT) rate or applying a lower rate on essential goods, and announcing special packages to attract Indian tourists would be appropriate. Tax exemptions, production-based relief, and concessional loans are necessary for small and medium enterprises. Additionally, by reviewing the budget, funds from unnecessary headings can be utilised for reconstruction,” said Dhakal.

Similarly, Birendra Pandey, President of the Confederation of Nepalese Industries, stated that in the current situation, it is crucial to strengthen the confidence of businesspeople and focus on revival, and that they are prepared for this.

Kamalesh Kumar Agarwal, President of Nepal Chamber of Commerce, highlighted the significant contribution of the private sector to the Nepali economy and emphasised the need to boost the morale of businesspeople. Karan Chaudhary, President of NADA Automobiles Association of Nepal, mentioned that despite significant damage to the auto sector, everyone must work together for its revival.

Min Bahadur Gurung, founder of Bhatbhateni Supermarket, which suffered substantial losses during the protests, expressed his continued desire to invest, create employment and contribute to revenue.

Following the private sector’s suggestions, Finance Minister Khanal assured that economic reform efforts would be undertaken with the support of the private sector. He also announced the decision to extend the deadline for submitting tax returns by one month, as per the private sector’s request.

During the discussion, business representatives also drew Finance Minister Khanal’s attention to immediate financial relief measures, such as deferring the working capital loan directive for at least two years.