New Delhi: As the economic rebounding is the need of the hour to brave a new world in post-pandemic times, under the aegis of its bilateral economic policy Think Tank India-Nepal Centre (INC) and in association with the Confederation of Nepalese Industries (CNI) and Nepal SBI Bank Ltd (NSBL), PHD Chamber of Commerce and Industry (PHDCCI) hosted a virtual Roundtable on Managing Working Capital in Nepal and India on 22nd February 2022 to bring the important stakeholders from the government and industry on a common idea platform from both India and Nepal to discuss some of the most crucial aspects concerning working capital requirements for industries in both India and Nepal. Among the panellists’ and participants of this coveted initiative were the leading policymakers, industry leaders, bankers, diplomats and domain experts from both India and Nepal.
While the world is self-assured to see a sort of re-set, it is the time for the government and industry to reckon the urgency of figuring out their immediate priorities, including on supporting the Micro, Small and Medium Enterprises (MSMEs) and Exports, the backbones of the economy. “A change in approach is much needed at this point of time, before the fundamentals of the world order go into reset mode, there should be determination to revive the MSMEs and industries at large to support the much needed demand factor of the economy with enabling a supportive institutional financial mechanism for managing working capital needs. This is the time for proactive collective action to come out of the trying time with a blueprint for revival of the economy,” said Pradeep Multani, President, PHDCCI.
“In the post-pandemic times, the unprecedented crisis is yet not completely over as the low demand, underutilised industrial potential and liquidity crunch are posing serious challenges to the industry and at larger scale the Gross Domestic Product (GDP). In particular, industry in Nepal is facing it acutely and this initiative is meant to voice the concerns of industry for timely policy interventions to ease the situation for doing business,” said Amb K V Rajan, Chair, India-Nepal Centre, PHDCCI & India’s Former Ambassador to Nepal.
The Chief Guest & Keynote Speaker Maha Prasad Adhikari, Governor, Nepal Rastra Bank (NRB) highlighted the importance of working capital in this crucial time of recovery. He provided insight to the consulting document guidelines of NRB which include provisions of short-term loan extension for six months, monitoring and follow up mechanism, land and building collateral has been removed. He also mentioned some of the challenges and solutions to the same like productive areas should be prioritized for giving loans, regulatory restrictions will be revised for ease of doing business. He encouraged the investment from India and ensured the borrowers loans on working capital be provided at reasonable interest rates. Speaking on the occasion, Ram Prasad Subedi, Chargé D’Affaires, Embassy of Nepal in India hails India-Nepal Centre’s contributions in facilitating the bilateral business cooperation and for hosting most relevant dialogues. He assured that the Nepal Embassy will continue supporting the business collaborations and effectively enhance the bilateral economic cooperation between India and Nepal.
Dipak Kumar De, MD & CEO, NSBL reflected on the present economic scenario of Nepal and how critically important is managing the working capital in Nepal while saving the financial ecosystem from both the trends of over and under-financing. He suggested some of the recommendations like improvisation in the working capital draft policy, simplification of criteria of core working capital, cash budget to be adopted to provide cash flow indications and scientific assessment of working capital to be done. Remarkably, NSBL has been catering to the working capital needs of business in all sizes across Nepal, he added.
Vishnu Agarwal, President, CNI, addressed the major challenges faced by Nepal which are liquidity issues with the bank and deficit in balance of payment while calling for proactive policy support. He suggested that more FDI should be facilitated from India to Nepal besides making the arrangement where the banks in Nepal can borrow from India to avoid the acute liquidity crunch that is gripping the industries as of now. Badri Narayanan Gopalakrishnan, Head-Trade & Commerce, NITI Aayog cited how trade facilitations and private investment from India to Nepal are making positive trends and improving the business climate in both countries. Bishal Thapa, Senior Economist gave a macroeconomic overview of Nepal’s emerging economic realities like liquidity and demand slump that essentially make the road to recovery tough. Representing the media industry, Mahesh Swar, Assistant General Manager, Kantipur Media Group counted the challenges being faced by the media organisations in general as the broad economic performance has close bearing to its operational status and growth. He called for supportive policy measures for the media industry in a testing time like now.
The program was conceptualised, curated and coordinated by Atul K Thakur, Nodal Coordinator, India-Nepal Centre, PHDCCI, and attended by among others Chhaya Sharma Panta, Head-Women Leadership Forum, CNI & Country President, ABWCI; Mohan Gurung, Founder President, Nepal Seattle Society; Aditya Tripathi, Secretary, PHDCCI.
In partnership with the economic diplomacy establishments of both sides, industry associations like CNI and other industry stakeholders, PHDCCI’s Bilateral Economic Think Tank “India-Nepal Centre” has been working as an Apex Industry Chamber of India with a very deep presence in Nepal. Both at policy and grassroots levels, India-Nepal Centre has been working for fostering economic cooperation and development partnership between India and Nepal.