KATHMANDU: The government has been unable to sell foreign employment savings bonds as desired in the current fiscal year. The Public Debt Management Office called for the purchase of savings bonds worth Rs 1 billion, but bonds worth only Rs 51.6 million have been purchased.

"Foreign employment savings bonds worth only 51.6 million were purchased," said Dilaram Giri, the information officer of the Public Debt Management Office. "The trend of selling such savings bonds below the target has persisted for a long time. We were hopeful that allowing online purchases would increase the sales, but that did not happen as expected." The deadline for buying savings bonds was extended until June 25.

The government has been issuing 'Foreign Employment Savings Bonds' for nearly a decade and a half with the plan to invest the income of Nepalese employed abroad in the productive sector. However, every year, the sales fall short of the target.

The Public Debt Management Office issued a notification on May 2, calling for the purchase of Rs 1 billion in savings bonds.

The notice mentions that the target group can purchase a minimum savings bond worth Rs 10,000 from May 5 to June 4. The notice further mentions the annual interest rate on the savings bond with a maturity period of five years will be 9 percent.

Giri stated that Nepali people living in more than two dozen countries bought the latest foreign employment savings bonds. "The largest number of buyers are Nepalis in Qatar," he said. "Nepalese in countries like Uganda and the Czech Republic have also purchased the bond."

Due to previous underperformance, the government has been reducing the size of these savings bonds over the past few years. Last fiscal year, Nepali citizens working abroad bought only Rs 26.3 million worth of foreign employment savings bonds out of a targeted Rs 1.47 billion. Previously, the central bank used to raise internal debt for the government, but since last March, the Public Debt Management Office has taken on this role.

"It is not clear why people are reluctant to buy these savings bonds, but it seems to be due to a lack of awareness," Giri said. The government started collecting loans through savings bonds from FY 2066/67. According to Nepal Rastra Bank’s data, only 4.9 percent (equivalent to Rs 762.3 million) of savings bonds were sold out of Rs 15.56 billion targeted through 25 schemes till last year.