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The government has decided to increase its share of contribution to implement the transmission line projects under the Nepal Compact of the Millennium Challenge Corporation (MCC). MCC, the US aid agency has committed to provide $500m while the government had earlier pledged $130m to implement the transmission line and road improvement projects under the MCC compact. The Millennium Challenge Account-Nepal (MCA-Nepal), a special-purpose vehicle established to implement the compact, said on Monday in a press statement that the government will provide an additional $67m to cover some of the additional work proposed by the Nepal Electricity Authority (NEA). With the additional budget assurance, the government’s contribution has reached 28 percent of the total resources to be available for implementing the MCC program from just over 20 percent earlier. MCA-Nepal said that the government decided to incorporate NEA’s request to include additional works under the Electricity Transmission Project of the MCC Compact. “It is estimated that a budget of up to $67m might be required for the additional work which will be financed from the original compact budget,” reads the statement. According to the statement, after the full utilization of the original budget, any shortfall would be financed by the NEA. An official of the MCA Nepal said that the NEA had requested to add substation bays that would enable controlled connection of power to the substations. “As per the NEA’s request, we have to add many such bays which require further funding,” the official said. The additional budget was arranged to bridge the estimated shortfall of resources in the construction of the Nepal-India cross-border transmission line and additional scope of work in the three substations, i.e. installation of additional bays as per the current and future requirement of NEA, MCA-Nepal said. Even though NEA was considering constructing a 20-km section of the New Butwal to India border transmission line, MCA-Nepal itself decided to construct this section of the transmission line as its preparation was in an advanced stage compared to NEA. According to the MCA-Nepal, an increased financing pledge by the government has been considered as the government’s contribution to the compact purpose. “A simultaneous modification has been made in the annexes of the Compact through an implementation letter,” said MCA Nepal. There is also concern that the allocated budget would be enough to construct the 315 km power line because the last estimated cost of the projects to be implemented under MCC was made in 2016. “Any additional cost should be borne by the Nepal government,” said the official. There has been visible progress in the preparation and implementation of MCC Compact projects in Nepal after the compact was ratified by the House of Representatives in February last year. Last week, MCA-Nepal opened the bids to hire companies for the construction of 315 km long power lines. Six Indian companies have submitted bids to construct the power line which will be constructed in three separate packages. An association of Megha Engineering and Infrastructure Ltd and Power Mech Projects Ltd along with Kalpataru Power Transmission Limited, KEC International Ltd, Transrail Lighting Ltd, Tata Projects Ltd and Larsen & Toubro Ltd participated in the bid. According to the MCA-Nepal, though MCA-Nepal called for international bidding, only the Indian companies participated in the process. “Now, their evaluation process begins,” said the MCA-Nepal official. The three packages of the power line include Lapsiphedi-Ratmate-New Hetauda 400kV D/C Transmission Line, Ratmate-New Damauli 400kV D/C Transmission Line, New Damauli-New Butwal 400kV D/C Transmission Line (Base), and New Butwal Nepal/India Border 400kV D/C Transmission Line. The high-capacity transmission lines will be built connecting Nepal's major power consumption centers including Kathmandu Valley, Butwal and Hetauda. This transmission line will also work as a bridge to link the eastern and western parts of the country with high-capacity transmission lines. Alongside the procurement process of contractors, MCA-Nepal has also initiated the process of acquiring lands for the transmission towers. It plans to determine the compensation amount before the entry into force of the MCC Compact scheduled to take place in August.

A meeting of the Parliamentary Hearing Committee has called for the submission of complaints, if any, against acting Chief Justice Hari Krishna Karki who has been recommended for the appointment to the post of Chief Justice. The meeting held today at Singha Durbar under the headship of its senior-most (by age) member Pashupati Shumsher Rana of Rastriya Prajatantra Party called for the registration of complaints, if there is any, against Karki or send it via email. The deadline for the submission of complaints is 10 days beginning today. The Constitutional Council had, on May 8, recommended Karki for the appointment to the post of Chief Judge of the Supreme Court. The post has been lying vacant for around 15 months. Speaker Devraj Ghimire and National Assembly Chair Ganesh Timilsina were present in the meeting that also endorsed the working procedures of the Committee.    

The price of gold has increased by Rs 2, 400 per tola in the domestic market on Tuesday. According to the Federation of Nepal Gold and Silver Dealers’ Association, the precious yellow metal is being traded at Rs 110, 500 per tola today. The gold was traded at Rs 108, 100 per tola on Monday. Meanwhile, tejabi gold is being traded at Rs 109, 950 per tola. It was traded at Rs 107, 600 per tola. Similarly, the silver is being traded at Rs 1,375 per tola today.

The Indian international tire brand CEAT has been present in the Nepali market for over one and a half decades. CEAT is the flagship company of the RPG Group. Satya Srinivasa Rao, Vice-president, International Business of CEAT India was recently in Nepal for a business visit. ApEx sat with Rao to talk about the Nepali tire market and CEAT’s plan for Nepal. Excerpts: How is the market of CEAT in Nepal? What growth prospects do you see in Nepal? We have been in the Nepali market for 15 years now. Our progress in Nepal has been good over these years. But last year, the business of tires went through a downturn due to import restrictions imposed by the Nepal government. However, our distribution channel is intact as the distributors have done a great job. And this year, we are again ready to see good growth. The CAGR (compound annual growth rate) of CEAT in Nepal has been above 14 percent in the last decade. This year, we are looking for a growth of above 20 percent. What is your market share in Nepal? We command around 20-22 percent of the share of the Nepali tire market. I am only talking about the passenger vehicle, two-wheeler, and truck segments excluding the agricultural vehicles segment. We have two distributors in Nepal, and they are tied up with over 400 local dealers who help us in the supply chain. In which segment do you see the biggest growth potential in Nepal? We have been very strong when it comes to passenger vehicle and two-wheeler segments. In two-wheelers, we are leading the market occupying a large market share. In passenger vehicles too, we are among the leaders. When it comes to commercial vehicles, we still have some grounds to cover, I must say. I would say we are in the third position—MRF being the first, followed by Apollo. However, we are trying to reach out to direct customers and expand our share of the market. Tell us about the innovation and customer service of CEAT.  We are not doing any specific product innovation for Nepal because the market here is almost similar to India. If we sell 100 types of products in India, around 90-95 percent of them also get sold in Nepal. But when it comes to services, we are ready to provide top-notch customer services. The new CEAT shop is a signature showroom of CEAT. We provide all tire retail services under one roof here. Customers can also look up various variants of CEAT tires from the showroom. How is CEAT doing in India? In India, our progress has been very good in the last five years. Similar to Nepal, we are No. 1 in two-wheelers. For passenger vehicles, Apollo and CEAT are neck-to-neck in the second position. We have made great progress in passenger vehicles because we are reasonably new in the market as we entered this category after 2008 only but other companies were in the market for a longer time. CEAT has not left behind Indian players only but multinational companies too. In commercial vehicles, we are slightly behind in the Indian market. But we are hoping to do better in the coming years. What is the contribution of your exports to the total business? We are currently in around 115 countries across the globe and around 16 percent of our total business is from export. Tell us about CEAT’s electric vehicle (EV) specific tire ‘Energy Drive’. Lately, every company has started focusing on EVs. Not only automobile companies but tire manufacturers too. The share of EVs in the automobile industry is expected to go up drastically in the next few years. We want to be leading the race when it comes to EV tires. Hence, CEAT has come up with Energy Drive tires specific to EV vehicles. We are glad to cater to the requirement if Nepal needs EV tires.

The economic downturn has taken a toll on investment commitments and registration of new industries in the current fiscal year. As the economic outlook of the country becomes bleak, investors are hesitant about new investment expansion. According to the Economic Survey, 2022/23, the registration of industries declined by nine percent in the eight months of the current fiscal year. A total of 183 industries were registered at the Department of Industry (DoI) till mid-March of this fiscal year 2023 compared to 201 industries during the same period of the last fiscal year. As the number of registered industries declines, the investment commitment has also gone down by 32 percent in the current fiscal year. The 183 industries registered this fiscal committed to investing a total of Rs 155bn compared to Rs 228.36bn in the last fiscal year. Entrepreneurs attribute this decline to the slowdown in investments to rising interest rates, adverse impact on the cash flow of businesses, and a huge drop in market demand for goods and services. Pashupati Murarka, former president of the Federation of Nepalese Chambers of Commerce and Industry says the ongoing economic crisis has discouraged the private sector from going to investment expansion. “As the economy is going through a recession, industrialists who earlier planned to invest in new business projects have chosen to stay in ‘wait-and-watch’ mode,” said Murarka. According to the Economic Survey, foreign direct investment (FDI) has also declined by 34.5 percent during this period. DoI registered 159 industries committing to bring FDI worth Rs 20.56bn to the country. In the last fiscal year, 149 industries were registered who'd committed to investing Rs 31.83bn. Surge in small industries' registration While there has been a decline in the registration of large industries, the registration of small and micro industries has increased. According to the Economic Survey, a total of 673,244 small and micro industries were registered in the current fiscal year compared to 550,776 industries in the last fiscal year. More than 15,000 companies registered The registration of companies/firms at the Office of the Company Registrar has decreased this year. A total of 15,187 companies were registered in the current fiscal year compared to 21,902 companies in the last fiscal year.  

I’m a 45-year-old man and a lot of people I know have told me to go see a psychiatrist. But I’m unable to accept that I have any psychological issues. Deep down, I know I do. I get irritated easily, sometimes I get anxiety and panic attacks making me lose control, and there are times when I assume that my family is out to get me even when all they want is for me to get better. But I’m scared of accepting that I might have depression or anxiety, or any other mental health issues. I fear going to the hospital, let alone getting treatment. This has made my family unstable too. They’re always on edge around me, since I have no control over my anger and I have a feeling that they would rather not have me around. It’s understandable. I want to get better but I don’t know where to start. Please help!—GP Answered by Dr Rishav Koirala, psychiatrist, and researcher Mental health issues have been stigmatized in Nepal and that might be one of the factors behind you not wanting to seek help. Many people have refrained from seeking help or accepting the fact that they need therapy. But the truth is seeking psychological help is nothing to be ashamed of. It’s the same as going to the hospital when you have some physical illness.  People also believe that going to a psychiatrist and getting themselves diagnosed means that they will not get better. That’s not true at all. I suffered from depression a few years back and was under medication. Now, I don’t take any antidepressants and there are some non-pharmacological treatments I follow that help me keep my mental health in check. The good thing is you are aware that you are suffering from mental health problems, although you are afraid of admitting it. I believe you’re scared of getting properly diagnosed since that will confirm the fact that you are having some mental health problems. But the thing is, they will exist despite you not receiving a proper diagnosis. I have some patients who think that they have depression only when they get a diagnosis from a doctor. But the problem exists with or without the diagnosis.  So isn’t it better to find out what the problem is and get the needed treatment, rather than be in denial? And wouldn’t it be nice to address it in an early stage where treatment will be less intense and medicines can be avoided?  Now, not every mental health problem needs medication. Sometimes it can be treated through non-medical approaches like therapy, exercise, yoga, and meditation. But to know what you need to do exactly, it’s important you visit a psychiatrist or any mental health professional to guide you through it.  Even if you have to take some medication, there are several options. Not everyone needs long term antidepressants and we keep in mind that you don’t suffer from side effects. There are myths regarding medications like drowsiness, weight gain, and having to take those medications for a long time. These are rare cases and if these happen, we address them. What I want you to do right now is look out for symptoms that indicate you need some mental health professional’s assistance.  If you think your current mental health status is hampering your social as well as work life, then that means you need to see a therapist or a psychiatrist. Also, from what you’ve said, you fear going to the hospital. That might be one of the symptoms of anxiety too. The feeling of being diagnosed might have made you more anxious about visiting the hospital.  Based on just the symptoms you have listed, I can’t say that you have a particular mental health issue with certainty, which is why you need to see a professional. They might start with medication, or you might have to go through some non-medical treatment like psychological therapy. But as long as you remain consistent and do as your mental health professional says, everything you’re going through can be treated and will get better. 

The Pushpa Kamal Dahal-led coalition government on Sunday presented a budget of Rs 1,751.31bn for the fiscal year 2023/24 in the Federal Parliament. Presenting the federal budget for the next fiscal year, Finance Minister Prakash Sharan Mahat reduced the size of the budget by 2.37 percent, announced measures to reduce recurrent expenditure, and largely refrained from bringing populist schemes. While the budget for the next fiscal year is lower than the current fiscal year’s budget, it is higher than the revised amount Rs 1,549bn during the mid-term review of the budget for the current fiscal year.  In bringing the budget for the first time as the Finance Minister, Mahat, who had to walk a tightrope managing the expectations of many while also maintaining fiscal prudence at the same time, has focused on easing the business environment, promoting startups, and making a push for digitization of the economy.   The finance minister has allocated Rs 1,141.78bn for the current expenditure, Rs 302.07bn for the capital expenditure, and Rs 307.45bn for financing purposes. The recurrent expenditure of the government accounts for 65.20 percent of the total budget while the capital expenditure is 17.25 percent of the budget. Likewise, the budget allocated for financing purposes is 17.55 percent of the total budget, the finance minister said. The government aims to achieve a six percent economic growth and plans to keep inflation at 6.5 percent in the next fiscal year.  The government has set a target to collect Rs 1,248.62bn in revenue in the next fiscal year. Likewise, it aims to receive Rs 49.94bn in foreign grants, raising Rs 212.65bn from foreign loans and Rs 240bn from internal debt.  At a time when the government has been hard hit by a resource crunch, Mahat has announced various measures to cut the ever-increasing recurrent expenditure. The government has announced plans to scrap 20 public enterprises (PEs) of similar business nature. The government has said that it will not buy new vehicles in the next fiscal year and will not build new buildings. The government has abolished all kinds of incentives and extra allowances. Similarly, cash-based transport allowance will be introduced to replace vehicle privilege.  The federal budget for FY 2023/24 has emphasized prioritizing agriculture, tourism, and development projects for broad economic growth. Presenting the federal budget, Mahat said that the government’s highest priorities in the next fiscal year would be modernizing agriculture, developing the tourism sector, and supporting the completion of development projects. Mahat has tried to earn brownie points by announcing the much-needed second phase of economic reforms. In this regard, the government has removed the minimum threshold limit on foreign investment in the information technology sector. In a bid to facilitate Nepali IT companies, the government has said that up to 10 percent of the foreign exchange earnings made by the IT industry will be provided to them to establish contact offices in third countries for the purpose of exporting IT services and to purchase software or programs and install equipment. A separate law has been made to promote and regulate the trade of Nepali goods and services through e-commerce. Similarly, Mahat announced a 50 percent income tax concession for domestic firms exporting software programming, business process outsourcing and cloud computing services.  In order to promote innovation and startups, the finance minister said that one percent of the total budget will be allocated to foster innovation and support startup businesses. A separate unit will be established within the Education Ministry for promoting innovation and startups. The budget has allocated Rs 1.25bn for startups.  The government has announced that the process of registration and cancellation of companies will be carried out online. The budget has also abolished the fee for the capital increment of companies. The government has announced that there will be no fee charged for new company registration and capital increment. Now, companies will be registered by declaring an authorized capital of only Rs 100. Similarly, the government has promised to amend the labor law to adopt a flexible labor policy for IT and innovation-based industries. The other major policy initiative regarding FDI is the announcement of the arrangement of automatic approval for investment in the sectors, except for those requiring permission. The government has also said reinvestment of income earned from foreign investment will not require approval from now onwards. In order to maintain discipline in capital expenditure, Dr. Mahat said that a committee under the leadership of the National Planning Commission will be formed to monitor development projects worth more than Rs 1bn. The Environmental Impact Assessment (EIA) report must be approved by the Ministry of Forests and Environment within 30 days of the application. The budget has announced conducting country ratings of Nepal as well as organizing an investment summit in order to attract foreign investors. The announcement of the country rating is, however, not a new one, as the past budget had also talked about it. In between, the finance minister did announce some controversial plans—mainly the revival of the constituency infrastructure development program, allocating Rs 50m to each parliamentary constituency. The government has allocated Rs 8.25bn for the program. The then finance minister Bishnu Paudel scrapped the program after it received criticisms from various quarters of the society.  Continuing the cash subsidy provided for the export of various 36 types of goods, the budget has allocated Rs 900bn. “Cash subsidy provided for exports will be paid in three months,” Mahat said. In a bid to enhance international air connectivity, the government has announced a reduction in ground handling fees for foreign airline companies operating flights to and from the Gautam Buddha International Airport (GBIA) and Pokhara Regional International Airport (PRIA). “Discussions will be initiated with the authorities in Thailand, India, and China to establish air connectivity with these international airports,” Mahat announced.  In the meantime, the resource crunch has forced the government to cut the budget of 15 ministries for the next fiscal year, while six ministries saw an increment in their budget.  The Education Ministry, Home Ministry, Physical Infrastructure and Transport Ministry, Energy Ministry, and Health Ministry are the top five ministries that are getting the highest resources in the next fiscal year. The finance minister allocated Rs 197.29bn for the Education Ministry, Rs 194.16bn for the Home Ministry, Rs 134.39bn for Physical Infrastructure and Transport Ministry, Rs 87.45bn for Energy Ministry, and Rs 83.99bn for Health Ministry.  Mahat has kept the social security allowance unchanged for the next fiscal year. The government has allocated Rs 157.73bn for the social security scheme which is Rs 23bn more than the current fiscal year. Size is this budget’s enemy Dilliraj Khanal, Economist  The Finance Minister tried to effect reforms through the budget, but it didn’t show a way to monitor and tie up different sectors for this end. Besides, this budget is a big one and its very size may hamper its implementation, what with slimmer chances of getting grants and loans. The finance minister has pledged to cut down on expenditure, but he revived the constituency development fund, raising questions on the credibility of the budget.  A ritualistic budget, a looming debt trap Pushpa Raj Kandel, ex-vice chair, NPC Of the Rs 302.07bn allocated as capital expenditure for the fiscal 2023/24, the government, at this rate, is unlikely to spend even one-third. As usual, a large portion of the total amount will go toward the payment of salary to government employees. More capital will go toward fiscal expenditure management, meaning the government will likely spend more money on repayment of foreign loans by seeking to get foreign loans! This points toward a looming debt trap.  A ritualistic budget, it is the continuation of past policies. The body language of the Finance Minister, while he was presenting the budget in the Parliament, showed a lack of excitement. The body language told it all!   A departure from the past Chiranjibi Nepal, former governor  In a welcome departure from the trend of increasing budget size and revenue collection target, the finance minister has downsized the budget and revenue target. Austerity has gotten due priority. It appears that the budget aims to manage the current crisis, but let’s wait and watch the implementation part. As for the constituency development fund (CDF), it was necessary because Nepalis do not want their elected representatives to make laws and do nothing else.

The government has set aside Rs 31 billion for the expansion of East-West Highway. Presenting the annual budget for the fiscal year 2023/24 in a joint meeting of the federal Parliament today, Finance MinisterPrakash Sharan Mahat said that the expansion and upgrading of Narayangarh-Butwal and Kamala-Kanchanpur road sections would be completed within the coming fiscal year. Similarly, upgrading of Kamala-Dhalkebar-Pathalaiya, Butwal-Gorusinge, Kakadvitta-Laukahi, Pathalaiya-Narayangadh and Lamahi-Bhalubang road sections would be started. Signature bridges would be constructed over the Narayani river and Tinau river, he added. The finance minister said that Rs 31.02 billion has been allocated for expansion and upgrading of East-West Highway. The government would focus its investment in easy, safe, quality and sustainable transport infrastructures to facilitate citizen's lives and to prepare the basis of economic development, he said.