विदेशिने र बसाइँ सराइँ बढेका कारण वृद्धिदर घट्यो

Wednesday, 28 September 2011 08:12 नागरिक


ज्ञान न्यौपाने, काठमाडौं, असोज ११- नेपालको जनसंख्या २ करोड ६६ लाख २० हजार ८ सय ९ पुगेको छ। दस वर्षअघिको तुलनामा करिब ३४ लाख ७० हजार थपिएका छन्। केन्द्रीय तथ्यांक विभागले मंगलबार सार्वजनिक गरेको जनगणना २०६८ को प्रारम्भिक नतिजाले काठमाडौं उपत्यकामा धेरैको अनुमानभन्दा निकै थोरै जनसंख्या देखाएको छ।


राजधानी काठमाडौं, ललितपुर र भक्तपुरमा जम्मा २५ लाख १० हजार ७ सय ८८ जना बस्छन्। यी तीनै जिल्लाबाट विदेश गएकासमेत जोड्दा पनि साढे २६ लाख नाघ्दैन।

कुल जनसंख्यामा १ करोड २९ लाख २७ हजार ४ सय ३१ (४८.५६ प्रतिशत) पुरुष र १ करोड ३६ लाख ९३ हजार ३ सय ७८ (५१.४४ प्रतिशत) महिला छन्। जनघनत्व १ सय ५७ प्रति वर्गकिलोमिटरबाट १ सय ८१ पुगेको छ। काठमाडौंमा सबभन्दा बढी ४ हजार ४ सय ८ जनघनत्व छ भने मनाङमा सबभन्दा कम ३ छ।


जनसंख्या वृद्धिदर घट्यो

विभागका अनुसार नेपालको जनसंख्या वृद्धिदर ५० वर्षकै सबभन्दा कम १.४० प्रतिशतमा झरेको छ। यो दस वर्षअघिको जनगणनाभन्दा ०.८५ विन्दु कम हो।

२०१८ को जनगणनामा १.३१ प्रतिशत वृद्धिदर थियो। त्यतिखेर कुल जनसंख्या ९४ लाख १३ हजार थियो। त्यसपछि २०५८ सम्म वृद्धिदर लगातार दुई प्रतिशतकै हाराहारी रह्यो।


किन घट्यो?

विभागको जनसंख्या महाशाखा प्रमुख रुद्र सुवालले बसाइसराइ बढ्नु र प्रजनन् दर घट्नुले जनसंख्या वृद्धिदर कम भएको बताए।


'विदेश गएकाहरूको संख्या अत्यधिक वृद्धि हुनु पनि यसको कारण हो,' उनले भने 'यसले स्वदेशमा रहेको जनसंख्या घट्ने, विदेश जानेको बढ्ने भइरहेको छ।'


जनगणनाको तथ्यांकले १९ लाख १७ हजार ९ सय ३ विदेशमा रहेको देखाएको छ। यसअघि ७ लाख ६२ हजार १ सय ८१ विदेशमा थिए। विदेशिएकामध्ये ८६.७ प्रतिशत पुरुष र १३.३ प्रतिशत महिला छन्। त्यस्तै, ग्रामीण क्षेत्रका ८५.३८ र सहरी क्षेत्रका १४.६२ प्रतिशत विदेशिएका छन्।


जनसंख्या विशेषज्ञ सरदकुमार शर्मा विदेशिनेमा प्रजनन् दर बढी हुने उमेर समूहका युवा पुस्ताको बाहुल्य भएकाले समग्र जनसंख्या वृद्धिमा असर परेको बताउँछन्। 'प्रजनन् दर घट्दा स्वाभाविक रूपले जनसंख्या वृद्धिदरमा प्रभाव पर्छ,' उनले नागरिकसँग भने।



कहाँ कति?

काठमाडौंको जनसंख्या कति पुग्यो? धेरैको अनुमान थियो, ४० लाख वा ५० लाख। जनगणना २०६८ ले यो अनुमानलाई गलत साबित गरेको छ। राजधानी काठमाडौंमा सबभन्दा बढी १७ लाख ४० हजार ९ सय ७७ जना बस्छन्। ललितपुरमा ४ लाख ६६ हजार ७ सय ८४ र भक्तपुरमा ३ लाख ३ हजार २७ छन्। काठमाडौंबाट ९७ हजार, ललितपुरबाट २३ हजार र भक्तपुरबाट ९ हजारभन्दा बढी विदेशिएको तथ्यांक पनि जनगणनाले देखाएको छ।



धेरैले सोचेभन्दा कम जनसंख्या देखिए पनि जनसंख्याविद्हरू यसलाई स्वाभाविक भन्छन्। काठमाडौंमा शैक्षिक, प्रशासनिक लगायत विभिन्न कारणले जिल्लाबाट वर्षैभरि आउजाउ भइरहन्छ। तर, तिनीहरू यहाँका स्थायी होइनन्। काम सकेपछि फर्कन्छन्। यस्तो आउनेजाने क्रम वर्षभरि चलिरहन्छ। यसले एकचोटिमा ४०-५० लाखजस्तो भान भए पनि खास जनसंख्या त्यति धेरै हुँदैन।



काठमाडौंपछि दोस्रो बढी जनसंख्या भएकोमा मोरङ छ। यहाँ ९ लाख ६४ हजार बसोबास गर्छन्। तेस्रो स्थानको रुपन्देहीमा ८ लाख ८६ हजार, चौथोमा झापा ८ लाख १० हजार र पाँचौंमा कैलाली ७ लाख ७० हजार छ।



सबभन्दा कम जनसंख्या भएको जिल्ला मनाङमा ६ हजार ५ सय २७ छ भने मुस्ताङमा १४ हजारभन्दा कम। त्यसपछि डोल्पा, रसुवा र हुम्ला पर्छ।



कुल जनसंख्याको आधा तराई क्षेत्रमै छन्। दस वर्षअघि ४८ प्रतिशत तराईमा बसोबास गर्थे। हिमाली क्षेत्रमा ६.७४ र पहाडमा ४३.११ प्रतिशत छ। यसअघि हिमालमा ७ र पहाडमा ४४.३ प्रतिशत थियो।



विकास क्षेत्रका आधारमा सबभन्दा बढी मध्यमाञ्चल (३६.५ प्रतिशत) र सबभन्दा कम सुदूरपश्चिमाञ्चल (९.६ प्रतिशत) छ।



कुल जनसंख्याको १७ प्रतिशत सहरी र बाँकी ८३ प्रतिशत ग्रामीण क्षेत्रमा छन्। सहरी जनसंख्या वृद्धिदर ३.३८ र ग्रामीणमा १.०३ प्रतिशत छ। यसले ग्रामीणबाट सहरी क्षेत्रमा बसाइसराइ तीव्र रहेको देखाउँछ।



जनगणनाअनुसार २३ जिल्लामा जनसंख्या वृद्धिदर अघिल्लोभन्दा घटेको छ। खासगरी द्वन्द्वको चपेटामा परेका जिल्लामा जनसंख्या कम भएको देखिन्छ।



'यो प्रारम्भिक नतिजा हो, पछि घटबढ हुनक्छ,' सुवालले भने, 'कम्प्युटर प्रोसेसिङका बेला

यसमा सामान्य परिवर्तन आउँछ।'



अघिल्लो जनगणनामा पनि प्रारम्भिकभन्दा केही फरक नतिजा आएको विभागले जनायो। महानिर्देशक उत्तमनारायण मल्लका अनुसार त्यतिखेर एक लाखभन्दा कम फरक परेको थियो।



दस वर्षमा १४ लाख परिवार थप

दस वर्षमा कुल १४ लाख ६ हजार ७ सय ६४ परिवार थप भएको गणनाले देखाएको छ। अहिले परिवार संख्या ५६ लाख ५९ हजार ९ सय ८४ छ। नतिजाअनुसार देशभर ४७ लाख ६७ हजार १ सय ९६ घर छन्। घर र परिवारको अनुपातमा प्रत्येक सय घरमा औसत १ सय १९ परिवारको बसोबास रहेको पाइएको छ।



जनगणनाले परिवारको आकार पनि पहिलेभन्दा सानो भएको देखाएको छ। यसअघि ५.४४ सदस्य रहेको एक परिवारमा अहिले ४.७० रहेको विभागले जनाएको छ।





छ दशकदेखिको जनसंख्या



वर्ष/वि.सं. जनसंख्या/हजारमा वार्षिक जनसंख्या वृद्धिदर/प्रतिशतमा

२०१८ ९,४१३ १.३१

२०२८ ११,५५६ २.०५

२०३८ १५,०२३ २.६२

२०४८ १,८४,९१ २.०८

२०५८ २,३१,५१ २.२५

२०६८ २,६६,२१ १.४०





बसोबास बढी भएका ५ जिल्ला

काठमाडौं- १७,४०,९७७

मोरङ - ९६४,७०९

रुपन्देही- ८८६,७०६

झापा- ८१०,६३६

कैलाली- ७७०,२७९

अस्थिर राजनीति र स्थिर विनिमय दर

नेपालको राजनीतिक अस्थिरताले सबै वाक्क भएको स्थिति छ । वि.सं. २०५२ सालदेखि नै राजनीति अस्थिर छ । यो अस्थिरताको टुंगो लाग्ने संकेत देखिँदैन । त्यस्तै नेपालमा मूल्य पनि अस्थिर र उच्च छ । अनि आर्थिक वृद्धिदर पनि अस्थिर र न्यून छ । तर, यही अस्थिरतामा एउटा कुरा भने स्थिर छ । त्यो हो नेपाली रुपैयाँको भारतीय रुपैयाँसँगको विनिमय दर । २०४९ सालदेखि यो स्थिर रहेको छ- एक सय भारतीय रुपैयाँ बराबर एक सय साठी नेपाली रुपैयाँ ।

यदि सो अवधिमा विनिमय दर स्थिर भएझैं नेपालको राजनीति पनि स्थिर भइदिएको भए सायद नेपाल दक्षिण एसियामा समृद्ध देश भइसक्ने थियो । यसरी हुनुपर्ने कुरा स्थिर भएन तर समयअनुसार परिवर्तन भइरहनुपर्ने कुरा स्थिर भइरहेको छ । यसले गर्दा आर्थिक क्षेत्र निस्साएकिो छ । सीधा सम्बन्ध नदेखिए पनि कतै स्थिर विनिमय दरले राजनीतिक अस्थिरता बढाएको त होइन ? यदि बजारमा आधारित विनिमय दर हुँदो हो त राजनीतिक नौटंकी र आर्थिक गतिहीनता विनिमय दरमा प्रतिबिम्बित हुने थियो । जसले गर्दा कतै राजनीतिका हर्ताकर्ताले अर्थतन्त्रतर्फ सोच्न बाध्य भई राजनीतिक नौटंकीमा केही कमी आउँथ्यो कि ।

नेपालको विनिमय दरको इतिहास हेर्ने हो भने २०१७ सालसम्म भारतीय रुपैयाँसँगको विनिमय दर बजार निर्धारित थियो । तर, त्यतिखेर सरकारी राजस्वसमेत भारतीय मुद्रामा संकलन गर्ने गरिन्थ्यो । यस्तो अवस्थामा नेपाली मुद्राको प्रचलन बढाउने उद्देश्यले २०१७ सालमा भारतीय रुपैयाँसँग स्थिर विनिमय दर तोकियो । त्यतिखेर तोकिएको भारतीय रुपैयाँसँगको स्थिर विनिमय दर र अहिलेको विद्यमान विनिमय दर एउटै छ ।

२०१७ सालपछि भारतीय रुपैयाँसँगको विनिमय दरलाई पटकपटक परिवर्तन गरिएको छ । २०२३ सालमा झन्डै नेपाली रुपैयाँ भारतीय रुपैयाँ बराबर थियो- एक सय भा.रु. बराबर एक सय एक नेपाली रुपैयाँ । तर, यो दर धेरै समय टिकेन, डेढ वर्षपछि नै नेपाली रुपैयाँलाई अवमूल्यन गर्न थालियो । पटकपटक अवमूल्यन गर्दै जाँदा २०४२ सालमा विनिमय दर एक सय भा.रु. बराबर १६८ ने.रु. थियो । यहाँसम्म अवमूल्यन गर्दै आइएकामा २०४८ मा नेपाली रुपैयालाई पुनर्मूल्यन गरी भा.रु. एक सय बराबर ने.रु. १६५ बनाइयो । खास गरी यो समयमा भारतमा भुक्तान सन्तुलन घाटामा गएको थियो र भारतले भारतीय मुद्रालाई अन्य मुद्रासँग उल्लेख्य मात्रामा अवमूल्यन गरेको थियो ।

बाह्य क्षेत्रको उदारीकरण गर्ने सिलसिलामा २०४८ फागुन २१ गते चालु खातालाई आंशिक परिवत्र्य बनाइयो । यसको झन्डै एक वर्षपछि २०४९ -१९९३ मार्च) माघ २ गते चालु खातालाई पूर्ण परिवत्र्य बनाइयो र नेपाली रुपैयाँलाई थप पुनर्मूल्यन गरी एक सय भा.रु बराबर एक सय साठी कायम गरियो । तत्पश्चात् भने विगतमा सक्रिय रहेको नेपालको विनिमय दर नीति निष्त्रिmय रहँदै आएको छ । यसरी विनिमय दरलाई नचलाइराखेको १९ वर्ष भइसक्यो । यो समयमा झन्डै बर्सेनि सरकार फेरिए तर विनिमय दर फेरिएको छैन ।

विनिमय दर स्थिर हुनुलाई सीधा रूपमा नराम्रो ठान्नुपर्ने देखिँदैन । त्यसमा पनि नेपालको आर्थिक हैसियत र व्यापार संरचनालाई हेर्दा बजार निर्धारित विनिमय दर आत्मसात् गर्ने आत्मबल आइसकेको देखिँदैन । तर पनि वास्तविक विनिमय दरलाई स्थिर राख्ने गरी बजारमा प्रयोग हुने विनिमय दरलाई समयानुकूल परिवर्तन गरिनुपर्ने हो । तर, त्यसो हुन सकिराखेको छैन ।

अरू केही स्थिर नभए पनि विनिमय दर त स्थिर छ । यसले के बिगारेको छ भन्ने प्रश्न उठ्न सक्छ । तर, यति लामो समयसम्मको भा.रु. सँगको स्थिर विनिमय दरले केही नकारात्मक असर पारेको छ । भा.रु. सँगको स्थिर विनिमय दरका कारण नेपाली रुपैयाँको अन्य विदेशी मुद्रासँगको विनिमय दरमा अनावश्यक उतारचढाव भइरहेको छ । यसले गर्दा नेपालको तेस्रो मुलुकसँगको बाह्य कारोबार प्रभावित भई बाह्य व्यापार भारतमुखी हुँदै गएको छ । अझ मुख्य कुरा त, नेपालको वास्तविक विनिमय दर अधिमूल्यित भएको छ । यसले गर्दा निर्यात नराम्री प्रभावित भएको छ । हुन त, राजनीतिक अस्थिरता र ऊर्जाको अभाव पनि प्रभाव पार्ने कारक हुन् तर तथ्यांकलाई हेर्दा नेपालको निर्यात र वास्तविक विनिमय दरबीच सीधा सम्बन्ध देखिन्छ ।

२०४९ साललाई आधार मान्दा २०५९ सम्म नेपालको भारतीय रुपैयाँसँगको वास्तविक विनिमय दर न्यून मूल्यित हुँदै गएको थियो । सो अवधिमा निर्यात पनि सुधार हुँदै गई २०५७/५८ मा कुल गार्हस्थ्य उत्पादनको १४.१ प्रतिशत पुगेको थियो । तत्पश्चात् नेपाली रुपैयाँको भा.रु. सँगको वास्तविक विनिमय दर अधिमूल्यित हुन थालेपछि निर्यात क्रमशः खस्कँदै गएको देखिन्छ । आर्थिक वर्ष २०६६/६७ मा नेपालको निर्यात कुल गार्हस्थ्य उत्पादनको ५.२ प्रतिशतमा झरेको छ । यसै अवधिमा नेपालले विश्व व्यापार संगठनलगायत साफ्टा र बिमस्टेकको सदस्यता लिएको छ ।

व्यापारका लागि सहयोग कार्यक्रम सञ्चालन गरी वैदेशिक सहायतामा निर्यात व्यापार बढाउन ठूलठूला चिल्ला प्रतिवेदनहरू पनि तयार पारिएका छन् । तर, निर्यात व्यापार भने खस्कँदै छ र व्यापार घाटा बढ्दो छ ।

निर्यात प्रबर्द्धनका माध्यमबाट चीनलगायत पूर्वी एसियाली देशहरू आर्थिक वृद्धि बढाउन सफल भइरहेका छन् । यसका लागि उनीहरूले विनिमय दर नीतिलाई चनाखोपूर्ण ढंगले प्रयोग गरिराखेका छन् । अमेरिकी धम्कीका बाबजुद पनि चीनले आफ्नो मुद्रा अधिमूल्यन हुन दिइराखेको छैन । भारत पनि यसतर्फ चनाखो छ । तर, नेपालले भने विनिमय दर नीतिलाई बेवारिसे रूपमा निष्त्रिmय छाडेेको छ ।

विनिमय दर अधिमूल्यित हुन जाँदा निर्यात नकारात्मक रूपमा प्रभावित भई समग्र आर्थिक वृद्धिदर खस्कन जान्छ । आर्थिक वृद्धिदर कम हुँदा रोजगारीका अवसरहरू घट्न जान्छन् । अहिले नेपालमा यही भइरहेको छ । नेपालमा रोजगारी पाउन कठिन छ । यसले गर्दा वैदेशिक रोजगारी मात्र नेपालीको बाँच्ने आधार भएको छ । पराम्परादेखि मुग्लान पस्न बानी परेका हामी नेपालीलाई मध्यपूर्व र पूर्वी एसियाली देशहरूको आर्थिक सम्पन्नताले कम्तीमा जिउने आधार प्रदान गरेको छ ।

वास्तवमा बर्सेनि ३ देखि ४ लाख युवा जनशक्ति वैदेशिक रोजगारीमा गएर मात्र अहिलेको भा.रु. सँगको स्थिर विनिमय दर यति लामो समय टिकेको हो । विप्रेषण आप्रवाहले भुक्तान सन्तुलन थामेकाले नै एउटै स्थिर विनिमय दर यति लामो समयसम्म रहेको हो । विप्रेषण आप्रवाह अलिकति प्रभावित हुनासाथ गत वर्षदेखि भुक्तान सन्तुलन घाटामा गएको छ । यसलाई सुधार गर्न आयातमा नियन्त्रणदेखि मौदि्रक नीतिलाई कडा पारिएको छ । यसको प्रभाव वित्तीय क्षेत्रमा नकारात्मक रूपमा देखा परिसकेको छ ।

अन्तमा, सधैं गोलचक्कर लगाइरहने नेपालको राजनीति तथा सरकार र नीतिगत विश्लेषणलाई ओझेलमा पारिराखेको व्यवस्थापनमुखी केन्द्रीय बैंकले तत्काललाई विनिमय दर नीतितर्फ ध्यान दिने देखिँदैन । त्यसैले, नेपालीका लागि बढ्दो व्यापार घाटा, भुक्तान सन्तुलनमा चाप र त्यसमा पनि मुख्य गरेर बढ्दो बेरोजगारी बेहोर्नुको विकल्प छैन ।

प्रकाशित मिति: २०६८ भाद्र १४ ०९:२९ kantipur

Capital flows to the emerging market economies: a perspective on policy challenges

Speech by Mr Jaime Caruana, General Manager of the BIS, at the Forty-sixth SEACEN Governors' Conference, Colombo, Sri Lanka, 24-26 February 2011.

Abstract

Capital flows to emerging market economies (EMEs) have displayed a dramatic pattern over the past decade. Following the collapse during 2008, capital inflows have rebounded since 2009 to pre-crisis levels. The recent increase in international capital flows is a sign of strength for the world economy, but it also poses unusual policy challenges. Global accommodative financial conditions can spur capital inflows and make it more difficult for EM policymakers to pursue their internal stabilisation objectives. Growing inflation pressures in EMEs and a multispeed global recovery put a premium on the pursuit of sound macroeconomic policy, especially monetary policy. Fiscal policy should aim at reducing debt in good times. Real exchange rate appreciation should form part of the response in rapidly growing EMEs. Macroprudential policies can usefully complement, but not substitute for, such sound macroeconomic policies. Capital controls can only temporarily respond to highly unusual circumstances. Sound national policy action can contribute to better global outcomes, but policymakers in both advanced and emerging economies should take into account the implications of their actions beyond their own borders.

Full speech

It is a great pleasure to be here. The SEACEN Centre has a long and distinguished record in promoting a better understanding of economic and financial matters that are of interest to central banks. Today's conference fits well with this tradition, focusing as it does on the post-crisis challenges to central banks in emerging market economies (EMEs).

Capital flows to EMEs have displayed a dramatic pattern over the past decade. From 2002 to 2007, private net financial flows to EMEs increased by a factor of 10, to almost $700 billion. The trend reversed temporarily on heightened risk aversion following the Lehman failure: overall net inflows to EMEs fell by about 75%, to around $200 billion in 2008. But these flows have quickly rebounded since mid-2009: in particular, net inflows to emerging Asia returned to their pre-crisis peak levels in the first three quarters of 2010.

Strong capital inflows bring benefits as well as challenges. The good news is that strong fundamentals in many EMEs have reduced their vulnerability to sudden variations in capital flows. In fact, and quite unlike past experience, this financial crisis was limited in its impact, especially in emerging Asia. Better fundamentals, much improved external positions and the buffers provided by accumulated forex reserves all played a part in this outcome.

On the other hand, EMEs now face new difficulties associated with abundant capital inflows. These raise a number of significant policy challenges.

In my remarks today, I would like to develop three main arguments:

• First, the greater integration of EMEs in international capital markets is a welcome development for the world economy.
• Second, strong capital inflows pose important policy challenges.
• Third, these challenges put a premium on the sound conduct of macroeconomic policy.

1. The greater integration of EMEs in international capital markets is welcome

Let me start by emphasising that the recent increase in international capital flows should be considered as a sign of strength for the world economy.

First, international capital flows can contribute to channelling financial resources more efficiently. EM assets display a favourable risk-return profile, especially in Asia. Asia's economic dynamism suggests that capital should yield high returns - higher than those in industrial countries. Also, the riskiness of investing in EMEs has decreased, thanks to the steady improvement in their economic fundamentals. In particular, the contrast has sharpened between the greater macroeconomic stability observed in the emerging world and the large-scale deterioration in fiscal positions in many advanced economies. This new role of EMEs in the world economy is a long-term trend that has been under way for a decade - the crisis has only highlighted its importance.

Second, the increased integration of EMEs into international capital markets brings welcome diversification benefits - at both the national and the global level. So far, holdings of EM assets in the portfolios of advanced economy investors remain rather limited: by the end of 2009, the share of G7 countries' total portfolio investment assets in all EMEs was 9% (of which 4.6% was in emerging Asia). We can expect these shares to increase significantly in the years ahead. Increased financial globalisation also lets emerging market savers diversify into foreign assets. In fact, total gross capital outflows from major EMEs have already risen, from an average of less than $100 billion per year in the 1990s to $1.2 trillion in 2007.

Third, growing capital flows signal greater economic integration among EMEs themselves. By the end of 2009, the total amount of outstanding portfolio investments by major EMEs in each other's assets had reached almost $400 billion, up from about $150 billion just four years earlier. Such integration arises from financial liberalisation, the development of local currency bond markets, and growing internationalisation of the production chain, among other factors. This is particularly obvious in emerging Asia, where intraregional foreign direct investment has risen sharply in recent years. To take one example, China's direct investment flow into the ASEAN countries surged from $1.5 billion in 2005 to $27 billion in 2009. In Sri Lanka, China is investing in not only the Hambantota port but also a special economic zone not far from Colombo.

Taken together, we should welcome the secular trend towards stronger capital inflows into EMEs. Policymakers should not lose sight of this when thinking about how to deal with current challenges.

2. Strong capital inflows present important policy challenges

Let me now turn to key policy challenges. But before I address the first challenge, I would like to make a general observation. Perhaps it could be considered challenge number 0: the challenge of properly analysing capital flows and financial stability issues.

All too often, the analysis of capital flows gets trapped in the discussion about global imbalances. Flows tend to be analysed from the perspective of savings, investments and current account positions. However, from the monetary and financial stability viewpoint, a narrow focus on current account deficits and surpluses rarely provides enough information about relevant accumulations of risks and financial imbalances. And these financial imbalances led, among other factors, to the recent crisis.

I am not saying that global imbalances are unimportant. Clearly, they are relevant and raise policy issues of the first order. My point is that, by construction, they can capture only some of the risks.

What I am saying is that it is also important to monitor gross capital flows and their composition. It is gross rather than net flows that often matter for monetary and financial stability. Current accounts and the corresponding net capital flows say very little about financing activity, intermediation patterns, leverage use or liquidity mismatches. It is important, therefore, to analyse gross flows and complement this data with balance sheet analysis and market indicators.

Since the early 1990s, for example, the increase in gross capital flows into and out of the United States (that is, the change in gross claims) has expanded three times more rapidly than the increase in net claims on the country, which mirrors the current account deficit. These larger flows involve financial transactions not captured in the net current account financing but which are nonetheless relevant in explaining market and economic developments. A better understanding of these gross flows, balance sheet data and other indicators should help in choosing more effective financial stability policies.

Having made this point, let me move to the challenges.

A first challenge arises from the intrinsic volatility of financial flows. Looking at cross-border bank flows into EMEs, for instance, they have rebounded since the 2007 financial crisis, thanks to robust EM macroeconomic performance, favourable interest rate differentials, progress in the rebuilding of international banks' balance sheets and a move by institutional investors to correct the underweighting of EM assets in their portfolios. Yet cross-border lending has remained volatile from one quarter to another. Preliminary data indicate that the cross-border lending of international banks to emerging Asia rose by $77 billion in the third quarter of 2010, up 8.5% in that quarter alone. This inflow contrasts with an outflow of twice that size in the fourth quarter of 2008 (-$158 billion, of which Korea suffered -$56 billion). And we have also seen portfolio outflows in some countries over the past few weeks.

This volatility raises the threat of a sudden drying-up of market liquidity in key segments, leading to potential financial instability. Many EMEs felt the knock-on effects of such liquidity problems in global markets during the recent crisis.

Volatility also makes it hard for policymakers to distinguish between the underlying secular trend of flows that should be welcomed from transitory flows subject to reversal.

A second challenge lies in how EMEs can best avoid importing accommodative financial conditions. Weaker growth prospects and persistent financial fragilities in advanced countries have led to a prolonged period of near zero interest rates and unconventional policies in the largest economies. This has raised the attractiveness of EM assets and sharpened the incentives for capital inflows.

Concurrently, inflationary pressures have picked up in emerging markets. It is important to note that recent increases in food prices partly reflect the current food shortage. As such, they could persist and exert a still larger impact on EMEs, which tend to have higher food weights in their consumption baskets.

Global accommodative financial conditions have made it more difficult for EM policymakers to pursue their internal stabilisation objectives. This is perhaps particularly obvious in the case of bank flows, which directly contribute to local credit growth.

More generally, strong capital flows put upward pressure on the value of EM exchange rates, thus raising concerns over export competitiveness. As a result, policymakers hesitate to raise interest rates in response to upward pressure on domestic prices arising from increasing commodity costs and rapid demand growth. Ultimately, unavoidable monetary tightening widens interest rate differentials vis-à-vis advanced economies. This, in turn, can suck additional global capital flows into EM assets, thus driving exchange rates even higher. Meanwhile, large-scale sterilised foreign exchange market interventions may lose their effect or become increasingly costly as domestic rates continue to rise. In these conditions, the clear risk is that EME central banks will fall behind the curve.

But even if EM central banks raise short-term rates, global bond market developments may limit the effect of tightening on local bond market yields. Large-scale asset purchases seek to lower benchmark bond yields, especially those of US Treasury bonds. This policy is difficult to calibrate, not least because it takes us into partially uncharted waters. In theory, the direct purchase of securities can influence bond market yields via portfolio balance effects as private investors seek to replace the duration removed from the market and bid up the price of other financial assets.

The analysis becomes more complicated when debt management policies are considered. In the case of the United States, recent changes in government debt issuance policies have worked in the opposite direction: the duration of US government debt issuance is indeed lengthening, which tends to drive up longer-term yields. The Federal Reserve has estimated that the November 2010 decision to purchase another $600 billion worth of Treasuries may have lowered the 10-year Treasury yield by 25 basis points, all else being equal. This suggests that the impact of unconventional policies is relatively modest, not least in comparison with the normal volatility displayed by long-term interest rates as they respond to growth prospects, fiscal policy and anticipated inflation.

To the extent that central banks outside the United States buy dollars to resist currency appreciation and invest them in US government bonds, they stand shoulder to shoulder with the Federal Reserve on the bid side of the bond market.

Yet there are other channels through which bond-buying programmes influence global financial conditions, some of which raise financial stability risks. One is through the exchange rate, with lower bond yields reinforcing downward pressure on the industrial currencies and thereby heightening the challenges already faced by EMEs. A worrying prospect, which I trust that we can avoid, would be for misunderstandings over currency policy to degenerate into protectionism.

Another channel is the impact of very low yields on commodities, equities and real estate. Global commodity prices may be signalling global inflation pressures. I have already alluded to the influence of globally integrated bond markets on EM bond markets, and the same point can be made about global equity markets, despite the underperformance of EM markets over the last several months. One market that is less globally integrated is real estate, which is of particular importance in populous emerging Asia, where real estate prices are trending upwards.

Finally, strongly reinforced expectations that short-term rates will remain low for an extended period can whet risk appetite and spur the search for yield. For instance, global investors may be further attracted to risky carry trade strategies with potentially important financial stability implications at the global level. For example, events could lead to a disorderly unwinding of positions.

The upshot of all this is that it is unusually difficult for policymakers to distinguish capital flows that reflect structural improvements in the EMEs from transitory flows that only make sense while near zero interest rates prevail in leading economies. In this environment, the risk of monetary policy falling behind the curve is larger than usual.

3. Dealing with the challenges posed by capital flows puts a premium on strong macroeconomic policies

What should be the public policy responses to these challenges? We know that a range of policies and tools is available. Among them macroprudential policies, a concept very dear to the BIS, are gaining prominence and we all are studying and learning from the rich experience of Asia in this domain. Today, however, against the backdrop of a multispeed recovery, I would like to emphasise that the circumstances put a premium on the sound conduct of macroeconomic policy, especially - but not only - in EMEs.

The first priority for EMEs that face strong capital inflows is to preserve domestic monetary stability. This calls for tighter monetary policy to contain domestic price pressures and support sustainable growth in the longer run. Central banks in emerging regions have, in fact, already taken substantial steps to counter inflation - China, India, Korea, Malaysia and Thailand have recently raised policy rates by significant increments and Indonesia has made its first move. This tightening demonstrates an appropriate awareness of inflationary risks. Monetary stability is the precondition for both sustainable long-run growth and the continued credibility and independence of central banks.

Given the challenges posed by capital flows, however, other measures can usefully complement monetary policy. An obvious auxiliary tool in countries where domestic demand is particularly buoyant is to err on the side of budgetary caution by building up fiscal buffers during the present good times. The sharp deterioration in the post-crisis fiscal position of industrial countries has highlighted the advantages of following prudent budgetary policies throughout the cycle, and most importantly during good times.

Second, real exchange rate appreciation forms part of the necessary adjustment to a new equilibrium in rapidly growing EMEs. In fact, Asian currencies have already witnessed a significant appreciation in recent years. Since mid-2009, when capital flows began to return to emerging Asia, most regional currencies have appreciated by around 5-6% in real effective terms. The Indian rupee and Indonesian rupiah have risen even more sharply, by more than 12%, during this period. Singapore has opted for tighter financial conditions by adjusting its exchange rate band upwards. International attention has focused primarily on China. The renminbi has climbed by 14.5% in nominal terms against the currencies of its trading partners since June 2005, but a further appreciation would be helpful in dealing with rising domestic inflationary pressures. Each country's authorities can accept currency appreciation more readily if neighbours are doing likewise.

Moving gradually towards more flexibility in exchange rates would help market forces play their part in adjusting growth patterns, as well as counter the build-up of imbalances and establish two-way risk for investors in financial markets. More flexibility would also be conducive to the further opening of Asian capital markets.

Another, increasingly popular, approach is to rely on so-called macroprudential measures. Emerging Asia has been in the forefront here, using a wide variety of instruments. For example, some countries have used tools that target mortgage lending. Among these are loan-to-value (LTV) ratios that serve to moderate credit growth or prevent the build-up of risk in the banking system. Other authorities have tightened capital requirements against mortgages and household credit.

What can we say about the effectiveness of such tools? This is not easy to answer, not least because they have been frequently applied in conjunction with other measures. But there is growing evidence that they have helped to address exuberance in real estate markets, which - as shown by the 2007 financial crisis - can lead to severe financial instability. In general terms, macroprudential tools appear to have been effective in strengthening the resilience of the financial system and in dampening house price inflation.

However, I would like to caution against excessive reliance on macroprudential policies. Macroprudential measures should only complement, and not substitute for, sound macroeconomic policies. The use of macroprudential tools in preference to interest and exchange rates may reflect the difficulty of judging whether the driving factors behind strong capital flows are transitory. Yet, as I have just argued, this is a risky strategy if it delays needed adjustments in line with long term trends. Any rise in inflation expectations could undermine long-run macroeconomic performance.

We also should be cautious about widening too much the use of the macroprudential objectives or terminology. Macroprudential tools should not be confused with other measures, such as administrative capital controls. Temporary capital controls can address transitory capital inflows, but they should be just that: a temporary response to highly unusual circumstances. The longer such controls are left in place, the greater the chance of adverse economic side effects and resource misallocations. Furthermore, the private sector is quick to develop avoidance strategies - for instance, using offshore derivatives markets. Perhaps in the light of these considerations, few EMEs have made any noticeable shift towards discouraging capital inflows in recent months. India has even raised its limits on government bond investment for foreigners. And in Thailand, the Government Pension Fund is looking to diversify its portfolio internationally.

As an alternative to capital controls, other measures can be considered that aim precisely at liberalising existing controls. In the Philippines, the central bank has approved measures to encourage greater outflows, including higher ceilings on residents' foreign exchange purchases and outward investments.

Overall, there is a clear hierarchy of policy responses to strong capital inflows. The first and foremost is to use macroeconomic policies - including monetary, fiscal and exchange policies - to ensure domestic monetary stability. Macroprudential measures represent the second line of defence. They hold particular promise in addressing risk build-ups in the banking sector or in specific markets - especially real estate. Capital controls are measures of last resort. They can act as a safety valve in extraordinary circumstances - but not more than that. Finally, structural financial policies such as deepening capital markets and enhancing regulatory and supervisory frameworks continue to form part of the toolkit.

Conclusion

Let me conclude by emphasising three points.

First, strong and volatile capital flows present central banks in EMEs with unusual challenges. A tectonic shift of global economic activity towards EMEs together with unusually accommodative monetary conditions in major advanced economies makes it all the more difficult to distinguish transitory from structural changes in capital flows. Yet both types of shift exist, and it would be a mistake to address the long-term kind with temporary measures that delay the necessary adjustments.

On top of that, increasing price pressures raise the danger that monetary policies will fall behind the curve because they have underestimated the risks arising from easy domestic financial conditions and rising commodity prices. Low and stable inflation expectations and central bank credibility are too important and too precious to be put at risk. Macroprudential tools can supplement, but not substitute for, sound macroeconomic policies. And, lastly, administrative measures such as capital controls may ease some policy dilemmas but should always be seen as short-term palliatives.

Second, sound national policy actions can contribute to better global outcomes. Some observers have expressed the view that the current divide between still weak activity in industrial countries and incipient tensions in EMEs raises the risk of a "prisoner's dilemma" -that is, individual countries could shrink from pursuing sound domestic policies because they are uncertain about others' choices. This should not be the case: sounder macroeconomic policies in each jurisdiction will benefit the global economy as a whole, for instance by helping to gradually whittle down today's large current account imbalances.

Third, current conditions highlight the importance of properly factoring in the interactions among national policy decisions. Domestic policymakers in both advanced and emerging economies are better off if they carefully consider the implications of their actions beyond their own borders. Piecemeal approaches and fragmented responses could erode the benefits of global financial integration. Uncoordinated approaches may simply shift risks among recipient countries. A frank exchange of views on the international dimension of domestic policy action can therefore lead to better domestic policymaking. As its core mission, the BIS promotes such international dialogues; and conferences like this one today contribute immeasurably to better coordinated approaches.

Thank you.

Twin policy problems

Oped»

Twin policy problems

Prakash Kumar Shrestha

JUN 12 -
After a decade of political crisis, we could be heading towards an economic collapse. Our industrial sector is already in a moribund state. Agriculture is stagnant. And only few sectors— communication, transportation, airlines and the financial sector—flourished during the political turmoil of recent years. Among these, the financial sector has seen vigorous growth.

However, the Nepali financial sector is seemingly heading toward serious distress. Indicators points to a looming crisis in the near future. One after another, financial institutions have floundered. It appears that it is a matter of time before the next financial institution gets into trouble. A downward spiral is now apparent. If the financial institutions crumble in this way, the nascent deposit insurance scheme will not able to do anything for financial stability.

Paradoxically, when the economy was mired in the never-ending political drama, the financial sector expanded rapidly. A higher prospect of return lured people to invest in this sector, but the scope of other sectors gradually disappeared with a growing political instability and uncertainty.

While the financial institutions were competing for profit, the NRB came up with the conventional policies to fight increasing inflation and the balance of payments (BOP) deficit by tightening the monetary policy. The operations rested on Friedman’s quantity theory of money to quell inflation, which may be inapplicable in case of financial liberalisation with open borders. Inflation and BOP may no longer be a monetary phenomenon. Nevertheless, monetary tightness proved to be the seed of downfall in the financial sector.

In addition, while the financial sector has been expanding, the central bank itself has contracted its scope with the implementation of financial sector reform. This was done in the name of consolidation. But, despite shrinking manpower, the need of the hour is for the central bank to focus on regulation and supervisions. At the same time, the NRB has ignored the analytical capability of its employees. As a result, with the implementation of a set of measures such as new capital adequacy ratio, early warning system, prompt corrective action and risk based supervisions, financial institutions began to fail.

Another policy mistake was hiking the interest rate, but maintaining the exchange rate regime intact for a long time. Since 1993, the pegged exchange rate with the Indian currency has not been changed, causing the real exchange rate to overvalue. This has further hampered the industrial sector, flooding in the cheap imports from neighboring countries. Although other factors also play a role, an overvalued exchange rate may be suicidal for economic growth.

Given the economic structure, Nepal may not able to withstand the flexible exchange rate. Maintaining a currency pegged for so long time means inviting an economic disaster sooner or later. It has been 18 years that the exchange rate pegged with Indian currency has remained unchanged. As a result, there has been intense pressure on the demand for Indian currency with a higher trade deficit, and the management of this demand has become a tough task for the NRB.

Instead changing the exchange rate, even marginally, to correct the BOP deficits, the NRB hiked the interest rate in the last two years. This has constrained the financial sector. A simultaneous rise in interest rate and tightening credits to real sector has had repercussions in the financial sector. As a result of higher interest rates, the liquidity shortage has become worse. There is usually a tradeoff between liquidity and profitability. A shortage of both leads to financial fragility.

The NRB lost its share investment in Nepal Development Bank and it is rumored that it has a big amount of deposits in other troubled financial institutions. Then, a question arises for general public, which is safe—the financial cooperatives or the NRB licensed financial institutions? It may be an important reason why self-regulated cooperatives have mushroomed even in the urban areas.

Financial institutions also bear some of the blame. Nominal industrialists and businessmen, after failing in their respective areas, are venturing in the financial sector, with the inherent motive of embezzling public deposits. Coupled with increased risk taking, this has added to financial fragility. The practices of having exotic and fancy buildings, unnecessary colourful advertisements, unrealistic high interests on deposits, and the elevated pay for executives in our financial sector are nothing but ploys to deceive innocent depositors. Not only individual customers, but institutional depositors with the greed of a higher return have followed suit. In a time of distress, these institutional depositors are the main agents that destabilise the financial system.

In conclusion, to quote Joseph Stiglitz, “the financial institutions didn’t understand the risks that they confronted and their deceptive accounting practices, designed to mislead regulators, investors, and the tax collector alike, also deceived themselves.” The NRB’s tight monetary policy amidst lax supervision is equally responsible for planting the seeds of financial fragility.



Shrestha is a PhD Student at The New School for Social Research, New York

वित्तीय क्षेत्रको जोखिमका कारण र निदान

वित्तीय क्षेत्रको जोखिमका कारण र निदान

कान्तिपुर चैत्र २२, २०६७

प्रकाशकुमार श्रेष्ठ

चैत्र २१ -
हालका दिनहरूमा वित्तीय क्षेत्रले एकपछि अर्को झड्का व्यहोरिरहेको छ । नेपाल विकास बैंक खारेज भइसकेको छ भने सम्झना फाइनान्स कम्पनीको खारेजी प्रक्रिया सुरु भएको छ । युनाइटेड विकास बैंक र गोर्खा विकास बैंकलाई समस्याग्रस्त घोषणा गरिएको छ । गोर्खा विकास बैंकलाई समस्याग्रस्त घोषणा गरिएपछि आत्तिएका निक्षेपकर्ता एकैचोटी आफ्नो बचत निकाल्न लाइन लागेको देखियो । यी घटनाले विकासको क्रममा रहेको यस क्षेत्रमा धक्का पुग्ने र जनविश्वास गुम्नेतर्फ ध्यान दिनुपर्ने देखिन्छ ।

सन् १९८० को मध्यतिरबाट नेपालले आर्थिक उदारीकरणको नीतिसँगै वित्तीय उदारीकरण पनि सुरु गर्‍यो । त्यसभन्दा अगाडि सरकारी क्षेत्रमा मात्रै बैंक तथा वित्तीय संस्था खोल्न सकिने प्रावधान थियो । बैंकिङ कारोबार र ऋण लिन सरकारी स्वामित्वका वित्तीय संस्थाहरूको विकल्प थिएन । बैकिङ सेवा आवश्यकताभन्दा पनि विलासिताको वस्तुजस्तो थियो भने बैंक ऋण लिन त ठूलै पहुँच चाहिने गथ्र्याे । त्यतिखेरको राजनीतिक हस्तक्षेप र व्यावसायिकताको अभावमा यी संस्थाहरूको वित्तीय स्थिति अझै कमजोर छ ।

वित्तीय उदारीकरणले गर्दा विदेशी लगानीकर्तामात्र होइन, घरायसी निजी क्षेत्र पनि वित्तीय क्षेत्रमा लगानी गर्न हौसियो । सन् १९९० दसकको सुरुका वर्षसम्म नेपालको निजी क्षेत्रले बैंक तथा वित्तीय संस्था खोल्ने त्यति आँट गरेको थिएन, उनीहरू गलैंचा र तयारी पोसाकतर्फै केन्दि्रत थिए । यसले गर्दा २०४९ असार मसान्तसम्म नेपालमा पाँचवटा वाणिज्य बैंक, दुइटा विकास बैंक र एउटामात्र वित्त कम्पनी थिए । ०५० सालपछि नेपालको वित्तीय क्षेत्रले फड्को मार्न थाल्यो । आर्थिक वर्ष ०५०-५१ मा एकै वर्ष २० वटा वित्त कम्पनीहरू खुले । यति धेरै वित्तीय संस्था एउटै वर्ष खुलेको त्यो पहिलोचोटी थियो । त्यसपछिका वर्षहरूमा पनि निजी क्षेत्रले वित्तीय क्षेत्रतर्फ चासो बढायो । सुरुमा संयुक्त लगानी र निजी क्षेेत्रमा खुलेका बैंक तथा वित्तीय संस्थाहरूले छोटो समयमा गरेको प्रगति र नाफाले अन्य लगानीकर्तालाई पनि यसतर्फ आकषिर्त गर्‍यो । यसै समयमा बाह्य उदारीकरणले उत्पादनमूलक क्षेत्रमा प्रतिस्पर्धा गुम्दै गएको स्थितिमा राजनीतिक संक्रमण सुरु भएपछि नेपालका उद्यमी एवं व्यापारी वर्गका लागि वित्तीय क्षेत्र आकर्षकको केन्द्र बन्यो । यसले गर्दा वर्षेनि वित्तीय संस्था थपिँदै गए ।

२०६२-६३ को दोस्रो जनआन्दोलनपछि आएको राजनीतिक परिवर्तनपश्चात यो क्षेत्रको विस्तार अझ बढ्यो । नेपाल राष्ट्रबैंकले वित्तीय संस्था स्थापनाका लागि चाहिने चुक्ता पुँजी मनग्यै बढाउँदा पनि यी संस्था खोल्ने क्रम रोकिएन । यसपछि करिब ५ वर्षको अवधिमा १३ वटा वाणिज्य बैंक, ५९ वटा विकास बैंक, नौवटा वित्त कम्पनी र १० वटा लघुवित्त विकास बैंक थपिए । चालु आर्थिक वर्षमा मात्र १६ भन्दा बढी वित्तीय संस्थाहरू जन्मिए । यसरी उदारीकरणमा फस्टाएको प्रमुख क्षेत्रका रूपमा देखापरेको वित्तीय क्षेत्रले करिब २० हजार जनालाई रोजगारी र कुल गार्हस्थ्य उत्पादनमा चार प्रतिशतजतिको योगदान दिएको छ ।

जनसांख्यिक हिसाबले हेर्दा बैंक तथा वित्तीय संस्थाको संख्या नेपालमा अझै पुगेको छैन । बैंक तथा वित्तीय संस्थाको प्रतिशाखा करिब २५ हजार जनसंख्या देखिन्छ, जुन अरू देशको तुलनामा अझै बढी हो । तर पनि सहरकेन्दि्रत वित्तीय क्षेत्रको विस्तारले अहिले सहरी क्षेत्रमा बैंक तथा वित्तीय संस्थाहरूको उपस्थिति बाक्लै छ र यिनीहरू धानिन कठिन हँुदै गएको देखिन्छ । विगत एक-दुई वर्षदेखि यस क्षेत्रले विभिन्न झड्काको सामना गरिरहेको छ । समय-समयमा तरलता अभावबाट गुजि्रनुपरेको छ भने वित्तीय संस्थाहरू क्रमशः समस्यामा पर्नथालेका छन् । निस्त्रिmय कर्जाको अनुपात समग्रमा बढ्न थालेको छ । कतै अब वित्तीय संस्थाहरू नेपालको अर्थतन्त्रले धान्न नसक्ने स्थितिमा पुगेका हुन् कि ?

वित्तीय क्षेत्रको रफ्तारअनुरूप नेपालको अर्थतन्त्र बढ्न नसकेको पक्कै हो । ऊर्जा संकट, बिग्रँदो औद्योगिक सम्बन्ध र बढ्दो बाह्य प्रतिस्पर्धाले गर्दा नेपालका उद्योगधन्दाहरू संकुचित हुँदै गएका छन् । व्यावसायिक हुन नसकेको कृषि क्षेत्र मौसममा आधारित छ भने राजनीतिक संक्रमणकालले गर्दा सेवा क्षेत्रले पनि आशातित गति लिन सकिरहेको छैन । यस अवस्थामा वित्तीय क्षेत्रको दिगोपन निश्चित रूपमा जोखिममा छ ।

यसबाहेक संस्थागत सुशासनको अभाव, अर्ध-सार्वजनिक प्रकृतिको वित्तीय क्षेत्रलाई व्यक्तिगत कारखानाजस्तो ठान्ने प्रवृत्ति, गुणस्तरीय जनशक्तिको अभाव र छोटो समयमै व्यक्तिगत फाइदा लिइहाल्ने गैरसंस्थागत संस्कृतिले गर्दा नै यो क्षेत्रमा समस्या देखापर्न थालेका हुन् । निजी क्षेत्रको 'भेडा प्रवृत्ति' पनि समस्याको एउटा जड हो । नवीनताको अभाव र नटुंगिने राजनीतिक कचिंगलमा उत्पादनमूलक क्षेत्रमा जोखिम नलिई सहज सजिलो नाफाको खोजीमा अन्धाधुन्द नक्कल गर्नु नेपालको गलैंचा र तयारी पोसाक धराशायी हुनका एउटा कारण थियो । संरक्षणमा मात्र अस्तित्व खोज्ने निजी क्षेत्रले परिवर्तित समयअनुसार आफूलाई सक्षम नपारी कुनै एक क्षेत्रमा राम्रो देखेमा त्यसैको पछाडि कुद्ने स्वभावबाट पीडित छ । अहिले यही प्रवृत्ति वित्तीय क्षेत्रतर्फ पनि सल्केकाले यो क्षेत्रमा जोखिम बढेको हो ।

वित्तीय संस्थाहरू नाफाको स्रोत के हो भन्नेबारे प्रस्ट हुनुपर्छ । नाफाको मुख्य स्रोतका रूपमा कर्जाको ब्याज नै हो । निक्षेप परिचालन गरी कर्जा प्रवाह गर्दा तरलता जोखिमदेखि कर्जा जोखिमसम्मलाई ध्यान दिनुपर्ने हुन्छ । लिएको कर्जाबाट नाफा भएमात्र ऋणीले कर्जा भुक्तानी गर्नसक्ने हो । नेपालमा अहिले उत्पादनशील लगानी बढ्ने उपयुक्त वातावरण छैन, तर नाफाको लागि छट्पटिएका हाम्रा वित्तीय संस्था उत्पादन नगरी नाफा आउने जोखिमपूर्ण लगानी गर्न तल्लिन छन् । नोक्सानी भए निक्षेपकर्ता र साना सेयर लगानीकर्ताको हुने नाफा भए ठूलो अंश आफ्नै हुनेहँुदा वित्तीय संस्थाका सञ्चालक र कार्यकारी प्रमुखहरू जोखिम लिन डराएको देखिँदैन ।

वित्तीय संकट आउन नपाओस् भनेर वित्तीय क्षेत्रलाई उदारीकरणमा पनि धेरै हदसम्म नियमन र सुपरीवेक्षणमा राख्ने गरिन्छ । केन्द्रीय बैंकबाट इजाजत लिई यसैको नियमन र सुपरीवेक्षणमा रहने हुनाले यी संस्थाहरूमा जनविश्वास रहेको ठानिन्छ । तर सुपरीवेक्षण कार्य वित्तीय संस्थाहरूले उपलब्ध गराएको तथ्य र तथ्याङ्कमा आधारित हुने र समस्याको पहिचान, निर्णय र कार्यान्वयन गर्न समय लाग्ने गरेको छ ।

अर्कोतर्फ वित्तीय सुधारका क्रममा जनशक्तिमा गरिएको भारी कटौतीले केन्द्रीय बैंकको निरीक्षण र सुपरीवेक्षणीय क्षमता, वित्तीय क्षेत्रको विस्तारअनुरूप हुनसकेको छैन । निजी क्षेत्रले कुशलतापूर्वक आफैं काम गर्न सक्छ भन्ने मान्यताले गर्दा सरकारी नियमन तथा नियामक निकायलाई साँघुरो पार्ने उदारीकरणको प्रवृत्ति नै वित्तीय संकट ल्याउने मुख्य कारणका रूपमा देखिने गरेको छ । वित्तीय क्षेत्र आफैंले नाफा सिर्जना गर्ने क्षेत्र नभई कर्जा प्रवाह गरेर अन्य क्षेत्रले गरेको नाफाको अंशियारको रूपमा रह्ने क्षेत्र हो । तसर्थ यसको दिगोपना अन्य क्षेत्रको सफलतामा भर पर्छ । केन्द्रीय बैंकले अल्पकालीन सञ्चालन विकृति रोक्ने प्रयासमात्र गर्नसक्ने देखिन्छ । यसक्रममा बढ्दो जोखिमलाई मध्यनजर राखेर अन्य धेरै देशमा जस्तै नेपालमा पनि हालै दुई लाखसम्मको निक्षेप बिमा सुरु गरिएको छ । साना निक्षेपकर्ताहरूको निक्षेप सुरक्षित गरी यसले धेरै हदसम्म वित्तीय स्थिरता कायम गर्न सहयोग पुर्‍याउने अन्य देशको अनुभवले देखाए पनि तीव्रदरमा वित्तीय संस्थाहरूको वित्तीय स्थिति बिगँ्रदै जाने हो भने भर्खर सुरु गरेको निक्षेप बिमाले मात्र समस्या समाधान दिन सक्दैन ।

यस अवस्थामा राजनीतिक संक्रमणमा सुधार भई अर्थतन्त्रले गति नलिउन्जेल उदारीकरणको नीतिविपरीत भए पनि नयाँ वित्तीय संस्थाको स्थापनामा रोक लगाउनुपर्ने देखिन्छ । भएका वित्तीय संस्थालाई सुदृढीकरणका लागि केही समय दिन आवश्यक छ । अन्यथा बजारको अदृश्य हातले नेपालका केही वित्तीय संस्था बढारिन गई यस क्षेत्रप्रति जनविश्वास घटेर अर्थतन्त्र थप प्रताडित हुनसक्छ । तसर्थ वित्तीय क्षेत्रमा संलग्न हर्ताकर्ताले यसको प्रकृति बुझ्ने र वित्तीय ठग प्रवृत्तिलाई रोक्ने काम गर्नुपर्छ ।

नेपाल राष्ट्रबैंकका उपनिर्देशक श्रेष्ठ हाल न्युयोर्कको न्यु स्कुल अफ सोसल रिसर्चबाट विद्यावारिधी गर्दैछन् ।

प्रकाशित मिति: २०६७ चैत्र २२ ०७:४८

खस्कँदो सेयरबजारको आर्थिक प्रभाव

खस्कँदो सेयरबजारको आर्थिक प्रभाव (कान्तिपुर)

प्रकाशकुमार श्रेष्ठ

चैत्र ९ - दु ई वर्षअगाडि उर्लेको सेयरबजार अहिले दैनिक तल झर्ने क्रमले गर्दा धेरै लगानीकर्तालाई चिन्ताको विषय भएको छ । शान्ति प्रक्रिया सुरु भएपछि पछिल्लोपटक २०६३ मा बढ्न थालेको नेपालको सेयरबजार, २०६५ भदौ १५ गते उच्च विन्दुमा -नेप्से सूचकांक ११७५) पुगी घट्न थाल्यो जुन अझै कायम छ । अहिले नेप्से सूचकांक ३९० भन्दा तल झरेको छ । यसको कारण र आर्थिक प्रभावको समसामयिक विश्लेषण गरी नीतिगत निर्णय हुनुपर्ने देखिन्छ ।

शान्ति प्रक्रियाको सुरुवातसँगै नेपालमा राजनीतिक स्थिरता कायम हुने अपेक्षा गरी लगानीकर्ताहरू सेयरबजारतर्फ लागे । यही बेला बैंक तथा वित्तीय क्षेत्रको विस्तार तीव्रत्तर भयो । अन्य क्षेत्रमा लगानीको सम्भावना नरहेकाले बैंक तथा वित्तीय संस्थाहरूले पनि सेयर खरिद गर्न सेयरको धितोमा यथेष्ट कर्जा प्रभाह गरे । यसै समयमा बढ्दै गएको विप्रेषण आप्रवाहले गर्दा बैंकिङ क्षेत्रमा अत्यधिक तरलता ल्याएकाले पनि सस्तो ब्याजदरमा कर्जा उपलब्ध भयो । यही न्यून ब्याजदरले गर्दा बैंकमा रकम राख्नुभन्दा सेयर खरिद गर्नु फाइदाजनक देखियो । सेयरबजारप्रति एक किसिमको उत्साह र जागरण आयो । यस क्रममा केही चलाख लगानीकर्ताहरू करोडौं कमाउन सफल पनि भए ।

२०६३ चैतमा राष्ट्र बैंकले बैंक तथा वित्तीय संस्थाहरूका लागि न्यूनतम चुक्ता पुँजी दोब्बर वृद्धि गर्ने निर्देशनले हकप्रद र बोनस सेयर पाइने देखेर पनि लगानीकर्ता बैंक तथा वित्तीय संस्थाको सेयर खरिद

गर्न हौसिए ।

नेपालको सेयरबजार अनौठोखालको छ । सेयरबजार पुँजी परिचालन गर्ने बैंकिङ क्षेत्रको विकल्पका रूपमा रहनुपर्ने हो । तर नेपालको सेयरबजारमा बैंक तथा वित्तीय क्षेत्रकै बाहुल्य छ । उदाहरणका लागि २०६७ पुस मसान्तमा सेयरबजारमा सूचीकृत १९५ वटा कम्पनीमा १६५ वटा -८५ प्रतिशत) बैंक तथा वित्तीय संस्थाहरू नै छन् । यस किसिमकोे हाम्रो सेयरबजार उकालो चढ्दा पनि यसले नेपालको वास्तविक आर्थिक स्थितिलाई प्रतिबिम्बित गरेको थिएन भने ओरालो झर्दा पनि वास्तविक क्षेत्रमा भद्रगोल नै ल्याएकोे स्थिति छैन । लम्बिँदै गएको राजनीतिक अन्योलले र सुधि्रन नसकेको शान्ति सुरक्षाले गर्दा आफैं नेपाली अर्थतन्त्र पहिलेदेखि नै जकडिएको छ ।

राष्ट्र बैंकले २०६५ सालमा मार्जिन कर्जामा गरेको कडाइ, सोही समयमा विश्वव्यापी वित्त संकटले गर्दा विप्रेषण आप्रवाहको वृद्धिमा आएको कमी र आयातमा भएको तीव्र वृद्धिले गर्दा तरलतामा आएको अभावले सेयर खरिद गर्न सहज कर्जा उपलब्ध हुन छोडेपछि सेयरको माग घट्न थाल्यो । गन्जागोल राजनीतिक परिवेश र समयमा संविधान जारी हुन नसकिरहेको अवस्था त छँदै छ । सेयरको बढ्दो मूल्यलाई मध्यनजर राख्दै यसको कारोबारमा पँुजीगत लाभ कर लगाइयो भने स्वयं आयकर घोषणालाई कडाइसाथ लागू गरियो । यी सबै कारणले सेयरको माग घटायो ।

यसै समय सेयरको आपूर्तिमा भने बढ्योे । नेपाल टेलिकम र कृषि विकास बैंकले ठूलो मात्रामा प्राथमिक सेयर जारी गरे । नयाँ बैंक तथा वित्तीय संस्थाहरू स्थापना हुने र सेयर जारी गर्ने क्रम पनि रह्यो । बैंक तथा वित्तीय संस्थाहरूको ७० प्रतिशत संस्थापक सेयरमध्ये १९ प्रतिशत साधारण सेयरमा परिणत गर्न सक्ने प्रावधानले पनि साधारण सेयरको प्रवाह बढ्न गयोे । यी सबै माग र आपूर्तिका कारणहरूले समग्र रूपमा सेयरबजारलाई ओरालो लगायो ।

सेयरबजारमा उत्पादन तथा सेवामूलक कम्पनीहरूको उपस्थिति न्यून रहेको र सेयरबजारमार्फत पँुजी परिचालन हुन नसकिरहेको अवस्था

छ । केही वर्षदेखि राजनीतिक अन्योल र अस्थिरताले गर्दा सदैव कमजोर रहेको नेपाली अर्थतन्त्रलाई अहिलेको खस्कँदो सेयरबजारले आफैं समष्टिगत रूपमा खासै असर पारेको र पार्ने देखिँदैन । तर पनि तीव्रदरमा घटेको सेयरबजारले केही क्षेत्रमा भने पक्कै धक्का दिएको र दिन सक्ने देखिन्छ ।

खासगरी केही लगानीकर्ताहरूको सेयरबजारबाट छिट्टै धनी हुने सपनामा चोट पुगेको छ । सेयरबजार वास्तवमा सट्टेवाजहरू पनि चलखेल गर्न सक्ने प्रमुख थलो हो । सेयरबजारमा आउने अथवा ल्याइने अनावश्यक उतारचढावबाटै केही टाठाबाठाहरूले फाइदा लिने मौका पाउँछन् । दुई वर्षअगाडि सेयरको मूल्य बढ्दा केही सीमित व्यक्तिहरूले फाइदा लिँदै धेरै सर्वसाधारणलाई लोभ्याउन सफल भए । अहिले सेयरबजार झर्दा खासगरी घाटा बेहोर्ने चाहिं पछिल्लोचोटि सेयरबजारमा प्रवेश गर्ने सर्वसाधारण नै बढी मात्रामा रहेको हुनुपर्छ । घरजग्गा बिक्री गरेर र विदेशमा कमाएको पैसा सजिलै दोब्बर पार्न देखासिखी गर्दै सेयरबजार प्रवेश गरेका नवसिकारु नै अहिले बढी प्रताडित भएको उदाहरण पाइएको छ ।

सानो भईकन पनि छोटो समयमा सेयरबजारमा देखिएको उतारचढावले गर्दा नेपालको सेयरबजारको वास्तविक विकासमा नराम्रो धक्का लाग्ने देखिन्छ । उत्पादन तथा सेवामूलक उद्योगधन्दाहरूको विकास तथा विस्तारका लागि पँुजी परिचालन गर्ने सशक्त माध्यमका रूपमा विकसित हुनुपर्ने सेयरबजार अहिलेको उधोगतिले नराम्ररी प्रभावित हुने देखिएको छ ।

सेयरबजार खस्कँदै जाँदा सेयरबजारतर्फ हुने लगानी अन्यत्र मोडिने हुन्छ । सेयरबजार खस्केकाले नै घरजग्गा र आवासीय घर तथा व्यावसायिक भवनतर्फ लगानी तथा बैंक कर्जा बढ्न गएर घरजग्गाको मूल्य अकासिन गयो । घरजग्गाको मूल्यवृद्धिले वित्तीय अस्थिरता ल्याउन सक्ने सम्भावनालाई मध्यनजर राख्दै गएको आर्थिक वर्ष २०६६/६७ मा राष्ट्र बैंकले घरजग्गा कर्जाको सीमा घटाएर कडाइ गर्‍यो ।

सेयरबजार ओरालो लाग्दा अर्को प्रभावका रूपमा सुन आयात बढेको देखियो । आर्थिक वर्ष २०६६/६७ मा ऐतिहासिक रूपमा रु. ४२ अर्बको सुन आयात भयो । सुनको मूल्य बढिरहेकाले उक्त सुन आयातको केही अंश लगानीका लागि भएको हुन सक्छ । उच्च सुन आयातले गर्दा शोधनान्तर घाटामा गयो । यसलाई रोक्न सुनको आयातमा कडाइ

गरियो भने मौदि्रक नीति पनि कडा पारियो । फलस्वरूप, ब्याजदर बढ्यो र सेयरबजारमा लगानी थप घट्यो ।

सेयरबजारको मूल्यमा कमी आउँदा सेयरहोल्डरहरूको सम्पत्तिमा ह्रास आई मागमा कमी आउने सम्भावना पनि रहन्छ । तर, नेपालमा माग बढ्दा आन्तरिक उत्पादित वस्तु खासै नबढ्ने हुँदा बरु सेयरबजारको ह्र्रासले आयात घटाउन सहयोग पुग्ने देखिन्छ । तर, कुल सम्पत्तिमा सेयरको अंश खासै ठूलो नभएको अवस्थामा यस किसिमको सम्पत्ति प्रभाव त्यति सशक्त नहुन सक्छ । सेयरमूल्य लगातार झर्दै जाँदा लगानीकर्ता हतोत्साही भई अप्रत्यक्ष रूपमा पुँजी पलायन बढ्ने देखिएको छ ।

सेयरबजारमा मूल्य उच्च रूपमा बढ्नु र घट्नु राम्रो होइन, तर सेयरबजार, खासगरी दोस्रो बजारमा हुने उतारचढावबाट नै कसैले आम्दानी गर्ने गर्छन् । त्यसैले टाठाबाठा सेयर लगानीकर्ताले सेयरबजारमा आफ्नो अनुकूल सेयर मूल्यलाई तलमाथि गराउन उद्यत भइरहने हुँदा नै विश्वभरिकै सेयरबजार स्थिर रहने गरेको पाइँदैन । पछिल्लो समयमा प्रवेश गरेका त्यसमा पनि ऋणमा सेयर खरिद गरेका सेयर लगानीकर्ताहरू आतिएको अवस्था र मूल्य ज्यादै न्यून भइसकेको हुँदा केही चनाखा सेयर लगानीकताहरूले यस अवस्थाको पुनः फाइदा लिने गरी सेयरबजारलाई उकास्ने सम्भावना पनि छ । तर यसका लागि राजनीतिक परिदृश्यमा केही सुधारको संकेत चाहिं देखिनुपर्छ ।

अन्तमा, पुँजी परिचालनको सशक्त माध्यमका रूपमा विकास हुन सक्ने हुनाले सेयरबजारलाई भताभुंग हुन भने दिनु हँुदैन । मार्जिन कर्जामा केही खुकुलो पार्दै, गैरआवासीय नेपालीलाई सेयरबजार खोल्दै, उत्पादनमूलक उद्योगधन्दालाई सेयरबजार प्रवेश गराउँदै जाने नीति लिई यसको कार्यान्वयन गर्नुपर्ने देखिन्छ । मुख्यतः राजनीतिक स्थिरता कायम भई आर्थिक गतिविधि बढ्दै गएमा सेयरबजार केही समयमा नै उकालो लाग्न सक्छ ।

लेखक न्युयोर्कस्थित न्यु स्कुल अफ सोसल रिसर्चमा विद्यावारिधि गर्दै छन् ।

प्रकाशित मिति: २०६७ चैत्र ९ ०८:५७

Article on Alternative perspective on Economic Development

The Kathmandu Post (Jan 23, 2011)

Oped»

No invisible hands here

Kalpana Khanal, Prakash Kumar Shrestha

KATHMANDU, JAN 22 -
Nepal is now at a historical juncture of exploring a new path for economic development and peace building. In addition to the political agenda, economic issues should get space to shape the path of long-awaited and elusive economic development in Nepal.

Even after more than three decades of state-led development efforts and more than two decades of market-based economic policies, Nepal is still at the bottom of the development ladder with widespread poverty and unemployment. The economic liberalisation process initiated from the mid-1980s pushed the country into a decade-long internal armed conflict in 1996, resulting in a fragile political system. With the initiation of the peace process in 2006 and the declaration of a republic in 2008, Nepal is now recuperating from the shock of internal conflict, and in search of not only a new political system, but also a new way of attaining economic development.

Nepal initiated state-led development in 1956. However, after facing a balance of payments (BOP) deficit for three consecutive years in the first half of the 1980s, Nepal adopted an economic liberalisation process by implementing Structural Adjustment Programme in the mid-1980s. Then it pursued the International Monetary Fund and the World Bank’s prescription based on the Washington Consensus. Economic liberalisation policies embraced include privatisation of state-owned enterprises, market-determined price system, trade liberalisation, financial sector liberalisation and fiscal consolidation.

Consequently, Nepal has become one of the most liberalised countries in South Asia. On the contrary, economic performance has been dismal with low economic growth and denigrated living standards. It can be claimed that the economic liberalisation process has eroded the industrialisation base and ignited deindustrialisation of the Nepali economy. While Nepali markets have been flooded with imported goods, the capacity to compete in the exports market has not been strengthened.

Despite the implementation of three structural adjustment programmes and one Poverty Reduction and Growth Facility (PRGF) programme, Nepal still ranks 193rd in the world, with a per capita GDP of US $470. To the surprise of many market proponents, in the middle of implementation of the economic liberalisation process, Nepal plunged into the internal armed conflict in 1996 fuelled by an army of the deprived and unemployed. Neo-liberalisation policies mainly focused on macroeconomic stability, bypassing employment generation and poverty alleviation under the false belief of a trickle down effect.

Nepal was at par with East Asian economies like South Korea, Malaysia, Singapore and Thailand in the 1960s. The development gap widened in subsequent years, thus falsifying

the notion of neo-classical convergence proposition. Nepal still faces problems of limited productive land base, a landlocked location, dismal industrialisation, a weak export base, low per capita GDP growth, and a slow transition from a subsistence agricultural economy. The share of agriculture in GDP is still 35 percent and provides employment for two-thirds of the population, but not enough food to feed the whole country.

More importantly, Nepal is one of the lowest per capita consumers of commercial energy—a very critical indicator of industrial and urban development. Nepal has been passing through unprecedented energy crises for the last few years, facing power outages of up to 12 hours every day. As a consequence of this and prolonged political transition, investment has been low resulting in stagnant economic growth. This has also compelled a massive exodus of youth for foreign employment. It is hard to imagine that industrialisation will bring economic growth and development amidst the acute energy crisis. This situation is partly the result of neo-liberal policies of more than the past two decades that minimised the role of government in infrastructure building with hopes that a market-led economy will work through invisible hands to bring market equilibrium.

The developmental experiment in Nepal, and many studies done elsewhere, confirm that market-based development strategies alone do not work in countries like Nepal. On the same note, Chang and Grabel (2004) have suggested three reasons why the Washington Consensus is not desirable. First, the economic policies associated with the neo-liberal agenda have failed to achieve their chief goals and the cost of this failure has done serious harm to the developing world. Second, historical and current evidence supports multiple routes to development. In reality, most of the policies used by successful countries run counter to the policies advocated by neo-liberal economists today. Third, in the face of such evidence, some of those most closely associated with the Washington Consensus (and with neo-liberal policies) have recently attempted to modify their positions.

In this context, it is now necessary to recognise Karl Polanyi’s view that institutions, governance and distribution matter. In the preliminary stage of development, the government should be instrumental in bringing the economy onto a path of development. The state can fail in many dimensions, but as Polanyi (1944) emphasised, it is the central economic actor.

We should ignore the ‘one size fits all’ notion of economic liberalisation policy. In reality, the appropriateness of any particular policy depends on specific national conditions, such as resource endowments, the scarcity of foreign exchange, proximity to key markets, social and political conditions, and so on. Therefore it has to be a genuine task of emerging economists, politicians and policy makers to come up with alternative ideas and to promote feasible alternative policies that already exist in order to enhance rapid economic development that is equitable, stable and sustainable. The poor living in developing countries like Nepal deserve concrete development strategies that can guarantee decent jobs and provide basic infrastructure in the 21st century, not only piles of glossy reports that describe their plight with colourful pictures.



Khanal is a PhD student at the University of Missouri, Kansas City and Shrestha is a PhD student at the New School for Social Research, New York City)



kalpana khanal Prakash Kumar Shrestha

Article on Controlling Inflation

Breaking the bank

PRAKASH KUMAR SHRESTHA

Published on January 17, 2010

Recently, people have shown concern over the relatively high inflation in Nepal. After having low inflation averaging 3.6 percent from 2000 to 2005, inflation began to rise and reached levels as high as 13.2 percent in the fiscal year 2008/09, before sliding down to 10.5 percent in 2009/10. Recent data published by Nepal Rastra Bank (NRB) showed that as of mid-November 2010, annual inflation was 8.4 percent. In the news media, NRB has been blamed for not controlling inflation (see TKP Dec. 06, 2010, Fighting Inflation).

The NRB Act 2002 has clearly entrusted the NRB with the job of maintaining price stability and balance of payments (BOP) consolidation (external sector stability) through monetary policy, being fully influenced by the neo-classical notion of inflation determination. The belief that monetary policy can determine inflation is based on the Quantity theory of money. This is a closed-economy theory where money supply is proportionally related to price level if the economy is in full employment.

Another theory, the monetary approach to balance of payments in an open economy, shows the relation between money supply and balance of payments (BOP). In fact, both relations work when money is used solely for transaction purposes—where any finance motive is completely ignored. In other words, such a direct relationship only exists, for instance, when a helicopter drops a bounty of money in a place with no existing financial institutions. Though it may be common for people to blame the NRB after looking at the NRB Act 2002, a closer look at the determinants of inflation in countries like Nepal reveals that these notions of neo-classical inflation determination do not work. Criticism of the NRB is not enough to contain inflation.

In 2009, an expansion of monetary aggregates seems to have been accompanied by higher inflation, but a long-run relationship between the two is not strong in Nepal. Many empirical studies in Nepal have shown a weak relationship between money supply and price levels. Rather, inflation in Nepal is impacted primarily by inflation development in India on account of geographical proximity and the pegged exchange rate regime.

Despite the fact that inflation distorts price signals and leads to resource misallocations, Friedman’s hypothesis that inflation is always a monetary phenomenon may not be true—supply and cost play an equally important role in determining economic inflation. According to the heterodoxy school of thought, inflation does not necessarily have a monetary origin. In this context, post-Keynesians prefer to utilise income policy to control inflation taking into consideration cost-push inflation and the wage-price spiral.

The Nepali economy is at a historical crossroads—passing through a prolonged political transition it currently lacks an investment-friendly environment. Once we look at the disruptions to continuous supply caused by a series of strikes and blockades, low production, the energy crisis and so on, it is not strange to see high inflation in Nepal. Luckily, we haven’t experienced hyperinflation as has been observed in Latin American countries. The highest inflation recorded in Nepal was 21.2 percent in 1991/92 as the economic liberalisation process gained momentum. Given the structure of our economy—low industrialisation and rain-fed agriculture production—containing inflation to less than five percent is hard enough.

How can monetary policy bring down inflation? Following the neo-classical principle, one could argue for increasing interest rates or sucking up liquidity to lower the growth of money supply in the economy. Since last year, interest rates have already risen substantially and pleading for a further

rise in interest rates to combat inflation would be a disaster for the economy. Some productive areas like hydropower construction have already

faced growing production costs due to rising interest rates, with increasing challenges in obtaining credit. It seems this may protract the period of dark-ages in Nepal.

Moreover, sucking up liquidity to tighten the monetary policy will further aggravate the liquidity crunch, which the banking system has been facing for over a year. If the interest rate continues to grow, it may lead to a financial crisis through loan defaults and insolvency. Arguing for a tight monetary policy rests on the false belief that no economic agent ever defaults. As the land prices slide and transactions slow with rising interest rates, borrowers will certainly begin to default on their loan payments, sending a ripple effect across the financial sector.

One cannot deny that an attempt to lower inflation by raising interest rates may itself have an inflationary and redistributive effect. Rising interest rates may promote inflation, especially when firms are highly indebted, by increasing the cost of production. A tight monetary policy will increase the income received by the financial sector at the expense of the indebted sector.

In this situation, monetary policy alone is not enough to curb inflation. But it can be controlled to some extent by ensuring the smooth supply of goods and by strengthening agricultural production, which requires effective law and order and a strong government support system. However, such an effective governance system is not likely in the near future. Since people have a disinterest in agricultural activities, monetary policy does not seem to control impending further inflation, which is going to be emanating from globally rising food prices. Having lower inflation in Nepal will remain an illusion. Any improvements will require a joint effort from all stakeholders.

Shrestha is a PhD student at The New School for Social Research, New York