Roundup of Nepali Economic and Business News for Jan 27-29 By NepaliEconomy.com
The saga of 12-year long 750MW Rs 120 billion (US$1.6 billion) West Seti Hydro Project (WSHP) continues. According to the plan 90 percent of power from the project will be exported to India and Nepal will get the rest for free. Snowy Mountain Engineering Corporation (SMEC) is the largest owner with 26 percent and the rest is owned by Nepali government (15%), Indian's Infrastructure Leasing and Financial Services (IL&FS) (15%), ADB (15%), China National Machinery and Export Corporation (CMEC) (15%) and Nepali financial institutions (14%). CMEC increased its stake to 51 percent after ADB backed out late last year. Now ADB wants to re-join, duh! Republica newspaper is calling on Maoists to call off their agitation against India's GMR's planned investment in 300 MW Upper Karnali Hydropower Project because they themselves approved it when they were in power.
National Planning Commission (NPC) finally admitted that economic growth will be less than 5 percent this year versus their optimistic target for 6 percent growth during 3-Year Plan period (2010/11-2012/13).
The meeting of commerce secretaries of Nepal and India has born some fruits (a) India has committed to remove 4 percent extra-tariff on 217 items from Nepal (b) agreed to allow Nepal's trade with third-country through the port of Vishakhapatam. However issues like (a) countervailing duties on Nepalese exports (b) non-tariff barriers like accreditation process remain unresolved.
Few interesting tidbits from Nepal Enterprises Survey 2009 (a) 62 percent of respondents said political stability to be the main problem, 27 percent power outages and only 3 percent labor regulations (b) manufacturing loses 26 percent of sales due to power shortage.
Looks like the opening of Chitwan Milk Factory is putting investors' focus on milk sector. The misnomer, Kalinchowk Cow Farm and Research Center Ltd in Dolkha district plans to start the country's largest dairy farm with 10,000 heads Holystone breed of cows with Rs 500 million investment under PPP scheme. Currently the cost of producing milk in Nepal is Rs 25 versus Rs 9 in China, and the demand is estimated at 800,000 liters a day.
Something is fishy in the fish industry. During 8 months of of this year, Kalimati Fruits and Vegetables Market Development Board (KFVM) sold 1,744 tons of fish imported from India and only 20 ton produced domestically. Last fiscal year, Nepal produced 24,294 tons of fish. According KFVM vegetable prices have come down significantly owing supply increase.
Local government employees continue to strike and bring local government business to a standstill. As such, garbage in Kathmandu had to be collected under tight security. Business climate does not look great in Bara and Parsa.
Now Non-Resident Nepalese (NRN) can get a special Nepali ID by applying through at the ministry or Nepali diplomatic missions starting January 29, 2010
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