Kathmandu: The government has pledged to take necessary initiatives to address the problems faced by the banking sector, as well as financial institutes, microfinance, and cooperatives. This commitment was reaffirmed through its policies and programs for the upcoming fiscal year (FY 2024-25), presented by President Ram Chandra Paudel before a joint sitting of the Federal Parliament on Tuesday.

President Paudel stated that the government will come up with legal provisions as the policy level to tackle the challenges faced by banks, financial institutions, and cooperatives. According to the outlined policies and programs, the government aims to promote healthy competition, supervision, and regulation by incorporating feedback received from various stakeholders to address issues within these institutions and the capital market.

The government has assured the provision of refinancing and restructuring of loans for microfinance borrowers and adapting the cooperative policy to current needs. Additionally, cooperatives will be required to connect to the Cooperative and Poverty-related Management Information System. Those cooperatives with government ownership will receive support for integration, while savings and credit cooperatives will be encouraged to consider mergers, aligning with the government’s new policies and programs.

To consolidate small capital for large projects, the government aims to integrate scattered resources and involve private investment companies in operating and managing defunct industries such as the Gorakhkali Rubber Industry, Butwal Spinning Mills, and Hetauda Garment Factory.

Furthermore, the government intends to pursue policies to ensure fair, balanced, and transparent revenue distribution. Grants will be allocated based on objective criteria, and integrated laws will be formulated to govern the mobilization and sharing of natural resources, investment, and profit-sharing among the three tiers of government, as well as to resolve disputes among them.

In an effort to mobilize innovative instruments of development finance and encourage private capital mobilization, the government has adopted additional legal provisions. It promises to enact legal and structural interventions to improve both domestic and external investment climates.

Moreover, the government pledged to streamline the approval process for domestic and foreign investments, making it more convenient and predictable through the implementation of an automated digital system.

President Poudel emphasized that Nepal's country rating will be determined in the upcoming fiscal year, signaling the government's commitment to facilitating foreign loans and other mixed forms of investment.