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Struggling to provide electricity to industries, the Nepal Electricity Authority (NEA) has continued to cut power in the industrial zones in Terai. Particularly, the government-owned power utility has not been able to transmit power to the western Terai region during peak hours. Because of weak transmission infrastructure, NEA has been failing to take electricity from the eastern side of the country to the western side even though the country has been importing electricity in the winter from India by using the 400kV Dhalkebar-Muzaffarpur transmission line. Besides poor local transmission infrastructure,  equally poor cross-border transmission infrastructure has also prevented the country from trading power through with about a dozen low-capacity cross-border lines whose capacity ranges from 33kV to 132kV. Nepal and India agreed to upgrade these low-capacity power lines to boost electricity trading during the 10th joint secretary-level Joint Working Group and the secretary-level Joint Steering Committee held in Jaipur, India on February 17-18. There has been certain progress in upgrading low-capacity lines. “Construction of a second circuit of 132kV Kataiya-Kusaha cross-border transmission line has already been completed,” said a senior official of NEA.  “It should be charged with electricity soon  which has not happened yet.” Likewise, Nepal has already completed constructing a second circuit of the 132kV Parwanipur-Raxaul power line. “The Indian side has notified us that they are constructing an inter-connection of the line between Old Raxaul and New Raxaul area as a part of the construction of a second circuit of the cross-border line,” the official said. Particularly, industries based in the Birgunj area are suffering due to power cuts in the winter as Nepal has not been able to buy extra power from Bihar while Nepal cannot transmit additional power brought through the Dhalkebar-Muzaffarpur transmission line to the Birgunj area because of poor transmission infrastructure. In the last meeting, both sides agreed to improve the capacity of the Raxaul-Parwanipur power line by May this year. Likewise, Nepal has already built the Nepal section of the proposed  132 kV cross-border line between Mainaiya (Butwal)—New Nautanwa (India). “India has also decided to build part of the proposed power line on their side,” the NEA official said. During the last bilateral meeting in India, they had agreed to complete the new Butwal-Mainahiya power line by September this year. Similarly,  Nepal has already issued a tender for constructing a new 132 kV cross-border power line between the Nepalgunj-Nayantara line where a 33 kV line is available, according to the NEA. “The Indian government has also decided to build part of this cross-border line on its territory,” the NEA official said. The capacity of the Nepalgunj-Nantarapower line will also be improved by September this year. The two countries agreed to trade 70MW-80MW through the 132kV Tanakpur-Mahendranagar Cross Border Line. Currently, Nepal has only been importing power through this power line. Except for 400 kV  Dhalkebar-Muzaffarpur, all other transmission lines have been used for trading power exclusively via government-to-government agreements.  The NEA official said improvement in these low-capacity power lines would pave the way for more cross-border power trade. “We can also address power supply problems in certain areas of the country due to poor domestic transmission infrastructure,” the official said.

Nepal Rastra Bank (NRB) has unveiled the Cryptocurrency Risk Assessment Report today. In the report, the country's central bank has concluded that cryptocurrency cannot be brought into use as transaction in it would be financially risky. Cryptocurrency transactions are banned by the existing laws of Nepal. "It entails risks as investment in cryptocurrency results in capital flight since the investment is in foreign land, it might have adverse impact on remittance flow and create challenges in managing the foreign exchange reserves," reads the Report. It states that prohibition on cryptocurrency is necessary as it has risks including destabilizing the overall economic balance, risk on financial stability, risk in terms of implementing the monetary policy and risks of fraud and tax evasion, among others. NRB stated that transactions in cryptocurrency brought risk not only to the country but also various risks to people involved in such transactions. The Central Bank has imposed a ban on cryptocurrency as per the provision of Clause 12 of the Foreign Exchange (Regulation) Act, 2019 BS. People supporting cryptocurrency take it as a form of currency. However, there is no sovereign nation issuing cryptocurrency as in the current monetary system. NRB stated in the Report that there are around 23 thousand cryptocurrencies in use in the world at present and Bitcoin alone occupies 42 percent of its total market. It is also stated that there are about 450 cryptocurrency exchanges in the world. The Central Bank has been issuing public notice from time-to-time warning that transaction in cryptocurrency is illegal. "There is no guarantee or surety of any country or government in cryptocurrency, there is no any security and financial intermediary, and it has no other use except for the purpose of bookmaking. This virtual thing is not widely accepted but is issued and used by certain groups for their vested interest," read the Report. NRB has described cryptocurrency as a digital matter that can be transacted as a currency issued by the private sector. Its transaction is illegal in various countries including in Nepal. This virtual currency is issued for carrying out works related to payments without any financial intermediary (central bank or monetary authority issuing currency). Users connected to the network have themselves maintained accounts of the receipt and expenditure of cryptocurrency for carrying out its transaction. In the existing system, the central banks or financial institutions have been conducting this job. People carrying out transactions in cryptocurrency use 'blockchain' or 'distributed ledger' technology for bookkeeping. Cryptocurrency is mainly obtained through mining and purchasing.

As the country's economy goes through a downturn, the cases related to banking offenses have surged in the current fiscal year. From large businesses to small businesses, as well as individuals have been struggling to pay their dues and fulfill financial obligations on time, which according to Nepal Police has resulted in a rise in banking offense cases. According to the data obtained from Nepal Police, 6,483 cases of banking offenses with the amount equal to Rs 8.57bn have been registered till mid-March 2023. The data show there have already been more banking fraud cases registered in the first eight months of FY 2022/23 than in FY 2021/22. According to Nepal Police, a total of 5,416 cases of banking fraud were registered in the last fiscal year. The majority of banking offense cases are related to cheque bounces. In this fiscal also, 99 percent of banking offense cases are of bad cheques. Of the total 6,483 banking fraud cases, 6,422 were related to bad cheques. As per the Banking Offense and Punishment Act, 2008, the non-payment of a written cheque three times due to the account holder’s failure to maintain the amount mentioned on the cheque is counted as a banking offense. The second most registered banking offense cases are of the cooperative institutions where the depositors have been denied to withdraw their deposited money. Experts attribute the rise in banking fraud to the current economic crisis. There has been an interruption in the flow of money in the market due to a prolonged liquidity crunch as well as the slowdown in aggregate demand. In addition, banks and financial institutions' higher interest rates have also hit small businesses hard. Companies and individuals issue cheques of a certain date to settle their business and personal transactions. However, due to the recent downturn in business, the ability of companies and individuals to pay their creditors has weakened. People often issue bad cheques to their creditors to avoid a difficult situation. Nepal Police Spokesperson Poshraj Pokharel said that the number of banking fraud cases has increased due to the recent economic crisis. According to police data, cases related to banking fraud have been increasing every year. There were only 755 banking offense cases registered by the Nepal Police in FY 2017/18 which continued to surge in the next two fiscal years. But there was some decline in the registration of fraud cases in FY 2020/21. However, in the last two years, banking offense cases have again started to increase. Along with the cases, the monetary amount of banking fraud has also surged. Banking offense cases

Finance Minister Prakash Saran Mahat on Monday met with stakeholders of the capital market including the Chairman of the Securities Board of Nepal (Sebon) and a delegation of stock investors, brokers and merchant bankers to discuss the issues and the ways to resolve the problems. Nevertheless, this initiative of the newly appointed finance minister failed to raise the confidence of weary investors as the Nepal Stock Exchange (Nepse) plunged by 16.67 points on the second trading day of the week. Mahat first met the group of stock investors with whom he assured them of taking concrete steps to uplift the morale of the capital market. Then, he sat down with Sebon Chairman Ramesh Kumar Hamal and instructed him to bring forward concrete plans to reform the capital market. Unlike the appointment of Bishnu Poudel as finance minister in December 2022, the appointment of  Mahat has received a cold response from the stock market so far. The stock market lost 36.67 points in the two trading days after Mahat took charge of the Ministry of Finance. While the new finance minister is trying to bolster the morale of the private sector and stock investors, the stock market is yet to respond positively. The daily turnover also decreased on Monday compared to Sunday. Nepse recorded a daily turnover of Rs 920.24m on Monday against Rs 1.20bn on Sunday. On Monday, the Nepse opened at 1,888.61 points and hit an intraday high of 1,891.76 points before rising to the intraday low of 1,866.16 points and settling at 1,871.88 points. Along with the daily turnover, the number of trade shares also decreased on Monday. The number of shares traded decreased to 2.82m scripts from 3.78m on Sunday. Except for the trading sub-index, all the sub-indices turned red on Monday with the hydropower sub-index losing the most. Nabil Bank had the highest turnover of Rs 30.62m closing at a market price of Rs 589.9 per share. The shares of the Global IME Bank were the most traded on Monday.