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Police have arrested a person in possession of 561. 30 grams of undeclared gold. A team deployed from the District Police Office, Makwanpur arrested Kisan Sah (22) of Birgunj Metropolitan City-16 with gold worth Rs 5.4 million. He was made public by organizing a press conference on Wednesday. Sah was nabbed with the yellow metal while checking a vehicle (Pradesh 2-03-001 Kha 0159) at the Ratmate Check Post in Hetauda Sub-Metropolitan City-15. Sah had concealed the gold inside his shoes.    

The Nepal Stock Exchange (NEPSE) gained 16.42 points to close at 2,037.06 points on Wednesday. Similarly, the sensitive index surged by 3.82 points to close at 383. 69 points. A total of 12,561,440-unit shares of 275 companies were traded for Rs 5. 01 billion. Meanwhile, Khaptad Laghubitta Bittiya Sanstha Limited was the top gainer today, with its price surging by 9. 99 percent. Similarly, Rastriya Beema Company Limited was the top loser as its price fell by 5.62 percent. At the end of the day, total market capitalization stood at Rs 2. 97 trillion.

Commercial banks have decided to keep the deposit interest rate unchanged for the month of Ashad (mid-June to mid-July). A meeting of the Nepal Bankers’ Association (NBA) on Tuesday morning decided to keep the deposit interest rate as it is for the last month of the current fiscal year. After reducing the deposit interest rate in Baisakh (mid-April to mid-May), the NBA, the association of CEOs of commercial banks, decided to keep it unchanged for the month of Jestha (mid-May to mid-June). In Baisakh, under huge pressure from the private sector, NBA lowered the deposit interest rate to 9.99 percent for individual depositors. Similarly, the interest rate for institutional deposits was lowered to 7.99 percent from nine percent. The same will continue in Asadh also. Similarly, interest rates on savings account deposits have been set at a minimum of 5.40 percent to a maximum of 7.40 percent. Likewise, the interest rate on call deposits will be 2.7 percent. The deposit interest rate had increased to 10.12 percent in June 2022. The interest rate on deposits kept on increasing until January this year. Since January, banks have been lowering deposit interest rates for each month except for March. With the liquidity situation easing in the past 5-6 months, banks are in a better position in terms of liquidity management. NBA CEO Anil Sharma said, “We have reduced the interest rate by one percent point in Baisakh. It is not good to reduce or change it frequently.” While deposit interest rates remain unchanged, the loan interest rate is expected to decrease. As the banks started reducing the interest rates on deposits, their expenses will also decrease. As a result, the base rate is also decreasing. On top of that, the basic rate has to be calculated every month. The banks are under pressure to reduce the spread rate to four percent by the end of Ashad (mid-July) which is currently 4.4 percent. The Nepal Rastra Bank has instructed the banks to lower the spread rate to 4.2 percent by the end of Chaitra (mid-April) and four percent by the end of Ashad. As a result, bankers say that the lending rate will decrease. “Due to the pressure to bring down the spread rate to four percent by the end of the fiscal year, there is pressure to reduce the loan interest rate. Therefore, there is no room to reduce the deposit interest rate,” Sharma further said.

The Investment Board Nepal (IBN) has dispatched a letter to the Power Construction Corporation of China Limited (Power China), seeking an explanation from the latter, for not working according to the memorandum of understanding (MoU) to develop the 756 MW Tamor Reservoir Hydroelectric Project. The board sent a letter to the Chinese contractor this week asking it to reply within 30 days. Just ahead of Prime Minister Pushpa Kamal Dahal’s recent India visit, the 54th meeting of the board held on 14th May had decided to seek an explanation from the company. “A letter has been sent to Power China to send a reply within 30 days,” said Amrit Lamsal, spokesperson at the IBN. “We have also asked why the MoU should not be canceled.” The IBN, according to Lamsal, will take further action based on the reply of Power China. A board meeting of IBN in the last week of May had decided to seek an explanation from the Chinese company asking why the work is not progressing according to the agreement and action plan made by Power China to make the project together with the Nepali company HIDCL. HIDCL and Power China signed an initial agreement to develop the Tamor Project during Chinese President Xi Jinping’s visit to Nepal in 2019. Of late, HIDCL found it difficult to sell electricity in the Indian market while constructing the project in collaboration with a Chinese company, and it sent a proposal to the IBN to cancel the agreement. As per the MoU, the detailed project report (DPR) was supposed to be prepared within two years and take the project into the construction stage. However, even after three years, neither the joint venture company was established nor any work was done to advance the project. According to IBN sources, the government decided to give one month’s time to the Chinese company so that no legal dispute would arise later. IBN showcased the Tamor Project during the Nepal Investment Summit 2019 and received six proposals from various consortiums—two from China and one each from Qatar, America, Singapore, and Hong Kong for the development of the project. Out of them, two consortiums of investors were shortlisted to present a detailed proposal. The consortium of Power China and HIDCL was selected after the evaluation of their proposal. The project is located on Lambhu Khola of the Tamor River between the Tehrathum and Panchthar districts in Koshi Province. Interestingly, India’s state-owned Satluj Jal Vidyut Nigam (SJVN) has shown interest in developing the Tamor Reservoir Project and has sought permission from the government. The SJVN has recently signed a project development agreement (PDA) with the IBN for the construction of the 669 MW Lower Arun hydropower project. This is the second mega project undertaken by the SJVN after the $1.04bn 900-MW Arun-III hydroelectric project in the Arun River.