Tag Archives: nepali economy

TEN Reasons to Invest in Nepal

By Bhupendra Khanal

Many aggressive companies are staying away from Nepal, thanks to poor security situation. The power majors are considering of huge investment in Hydropower sector to export power to the power hungry states of India and China, and this is good news for Nepal. A country with very high hydro-power potential has one of the costliest energy, which simply is not acceptable. Nepal needs to reform the energy sector and prepare the base for development.

While the companies like Samsung, Kodak, LG, Kia etc have entered Nepal, their performance has not been very good in the past. The things are likely to change when Maoist are in the government. Many more companies are likely to follow the investment in this Himalayan country provided the early movers succeed. There are multiple reasons why companies would like to invest in Nepal:

1. Favorable Location: Nepal is a country between India and China, two fastest growing economies globally.

2. Power Sufficiency: Nepal is power rich (hydropower potential is more than enough for any future growth in economy).

3. Pleasant Climate: Nepal has one of the best climate on the world. The valley cities of Kathmandu, Pokhara, Surkhet and Dang are the front runners for this. Eastern city Dharan and western city Butwal are other places with comfortably moderate climate in the likes of Indian Silicon Valley, Bangalore. Continue reading TEN Reasons to Invest in Nepal

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Bad Ass Economy: Inflation Soars to 13pc

A press statement issued by Nepal Rastra Bank said that food and beverage prices shot up by 13.4 percent while non-food and service rates were up 12.7 percent.

Propelled by a remarkable rise in the prices of food and non-food commodities, the rate of inflation during the first month of the current fiscal year climbed to an alarming 13.1 percent from 6.3 percent recorded during the same period last year. A press statement issued by Nepal Rastra Bank said that food and beverage prices shot up by 13.4 percent while non-food and service rates were up 12.7 percent. Of the items showing a double-digit price rise, the price indices of oil and ghee increased by a whopping 36 percent in mid-August 2008 compared to an increase of 11.4 percent a year ago, said the release. Likewise, the sub-group of grains and cereal products witnessed a rise of 23.5 percent in mid-August 2008 while the prices of rice and rice products increased by 27.8 percent compared to an increase of 7 percent a year ago. Continue reading Bad Ass Economy: Inflation Soars to 13pc

Nepal’s Per Capita Is $470 (Which Still Looks Like a Misprint)

Agriculture growth 14 yr high
By Prem Khanal

Propelled by the a strong growth in both the agriculture and non-agriculture sectors, the long-ailing economy has bounced back to record 5.56 percent growth in the current fiscal year, highest economic expansion in last the seven years. With the growth, the total size of Nepali economy in producers’ price has scaled up to Rs 828.8 billion (US$12.80 billion) while the per capita income has also increased by around 11 percent to Rs 30,361 per year (470 US$). However, with the creeping inflation, which is around 9 percent, the real purchasing capacity of Nepali consumers is estimated to grow marginally in the year. According to a preliminary estimate of national accounts prepared by the Central Bureau of Statistics (CBS), agriculture sector, which contributes 32 percent to national economy, grew by 5.65 percent while the growth of non-agriculture sector was around 5.52 percent. Continue reading Nepal’s Per Capita Is $470 (Which Still Looks Like a Misprint)

It's Economy Stupid! Maoist Comrades Try to Assure the Business Community

Stock market has been crashed and business circle is confused. As the news of Maoist victory in the polls come out, the Maoist leadership is trying hard to assure the business community that they are here for capitalism.

For the CPN Maoist, the victorious party in the April 10 CA polls, the campaign hasn’t ended just yet. The party leadership is in full swing to convince the national forces, business world and the international community- at the same time- that they are not radical communist and there will be no cultural revolution in Nepal. Mao has died a long time ago. It seems that the Prachandapath (the path of Prachanda), an ideology propagated by Chairman Prachanda, tells them to have a very good relationship with ‘expansionist’ India and ‘imperialist’ America. Capitalism, they try to convince, is their mantra too. Prachanda says they are for the economy in which capitalists can have profit. Prachanda also says that there will not be a dictatorship of the proletariat. In his address to the business leaders in Kathmandu today the Maoist Chairman announced that the power will not be used tyrannically, reports Kantipur, but in the welfare of the people and the country. Continue reading It's Economy Stupid! Maoist Comrades Try to Assure the Business Community

In Autocracy, Nepal Economy Goes Down

Renewing its warning issued a month ago, Kathmandu based economic watchdog Institute for Development Studies(IfDS) today said, ” While stagnant income and increasing inflation mean hardships for the ordinary people, capital flight points out that the future economic prospects of the country are bleak.” Here i s the complete text of the report disclosed by the organization:

The Economic Level and Directionafter February 2, 2006……

Institute for Development Studies(IfDS)

Executive Summary

1. After the publication of our report on February 20, a new wave of interest was shown by all on the state of Nepalese economy. But no improvements have been noticed yet in the overall performances of the economy. Instead, a number of new policies and programs initiated by the government in the recent past have helped the economy to deteriorate further. Against this background, it is not necessary to change the following hypothesis discussed in our first report:

(a) “In the lack of proper measures to improve the situation, the economy may fall together abruptly;”

(b) “If the present trend continues, the government may be financially bankrupt by the end of June”;

(c) “Once the economic problem is exploded, we will not have long time in the name of finding alternative programs. We will not be surprised if total anarchy prevails in the country….The national identity itself will be at stake”. Continue reading In Autocracy, Nepal Economy Goes Down