Investment pledges swell despite fewer ventures

KATHMANDU, NOV 29 - 2013

Planned investments in new industries have increased in the last quarter even though fewer medium and large enterprises were registered at the Department of Industry (DoI).

The number of factories registered during the period stood at 97, down from 131 year on year. However, their proposed outlays jumped to Rs 163.55 billion from Rs 20.59 billion. According to the DoI, registrations of large hydropower projects led to the higher figure. The registration of ventures related to energy, manufacturing, services and tourism all fell during the first three months of the fiscal year. The sole sector that saw a growth was agriculture. Meanwhile, industries related to energy and agriculture are the only ones planning to increase their outlay. Investments in other sectors have fallen.

Proposed investments in the energy sector soared to Rs 159.65 billion from Rs 11.68 billion in the corresponding period last year. Planned outlays in farm-based enterprises also surged to Rs 649 million from Rs 362.68 million.

Industry ministry to study status of 10 more firms

KATHMANDU, May 20: 

After recommending ´sick industry´ status to four firms, the Ministry of Industry (MoI) is all set to conduct field study of another 10 firms that have applied for ´sick´ industry status.

“Our technical committee is preparing to dispatch a team to conduct field study of those 10 firms," a member of the technical committee under the ministry´s Industrial Promotion Division (IPD), told Republica.

The technical committee, which has been assigned to find out actual situation of the firms that have applied for sick industry status, sends a team of officials after completing their due diligence auditing.

The ministry has outsourced a team of chartered accountants to do due diligence auditing of the firms.

The 10 firms where the team will conduct field study are: Kharel Wooden & Metal Furnitures, Nava Durga Khadya Udhyog, Shree Antu Tea Industry, Laxmi Banaspati Ghee Udhyog, Bhrikuti Pulp and Paper, Gita Cold Store, Momento Apparels, Shirish Herbal, Shree Distillery and Dolphin Manner.
"The due diligence auditing report of these firms is in line with the financial statements that these firms had submitted while applying for sick industry status," the official said. "Now, the team will study the reasons behind financial failure of those firms.”

The ministry has already submitted a proposal to the cabinet to declare four firms -- Birat Leather, Birat Shoes, Nepal Borders and Basulinga Pvt Ltd - as sick and recommended them financial and non-financial facilities.

Yam Kumari Khatiwada, joint secretary at MoI who leads the technical committee, told Republica that a total of 37 firms had applied for ´sick industry´ status. These firms filed applications at the ministry after the government announced a program to revive sick industries in the country in 2011.

Source: Republica

Dozen sick firms set to receive facility

KATHMANDU, DEC 1, 2012

The technical committee, formed under the Industrial Promotion Division, has finally recommended the names of 12 industries for sick industry facility.

“We have submitted the final reports of 12 industries that had sought the sick industry facility from the government,” said under secretary at the Industrial Promotion Division (IPD) and coordinator of the technical committee Surya Kant Jha. “We expect the recommended industries to receive the facility by January 2013,” he said.

The reports of the 12 industries were based on their documents and observations made by representatives of the committee after field visits to the industries, interaction with stakeholders, and their bank transaction report. “After the recommendation is approved by our main committee, the final nod will be given by the cabinet,” he said.

The recommended industries include, wood and wire industries, floriculture industry, Nepal Board, Birat Shoes, Bishesh Textile, leather industry, Sumi Pharma, Fleur Himalayan, Kailali Chinimill, and Sirish Herbal.

According to the technical committee, there still are some more industries from the previous application and some new applicants who will also be observed following the same procedure. The committee goes for field visits, and evaluates and classifies the industries accordingly.

The committee is also preparing for an observation tour of industries within Kathmandu valley that have applied for the sick industry facility. The division has received 30 applications claiming the facility.

The division has received another six new applicants that have claimed for the sick industry facility. IPD has already received one-third budget, that is Rs 0.85 million for the sick industry selection and recommendation procedure.

“We are waiting for the remaining budget to execute the remaining programme,” said Jha. The government has allotted a budget of Rs 2.7 million for the process to classify and recommend the names of the sick industries.

The expert committee, formed under the coordination of the Industrial Promotion Division, this time is quite convinced about completing the recommendation process on time, though earlier taskforces and committees had failed.

Officials at the division said that the unclear industrial policy has delayed the rehabilitation of sick industries. However, with a more liberal industrial policy, IPD is convinced about forwarding the recommendation on time and timely approval by the government.

Source: THT

NRB may reject proposal to stop auctioning of six ailing firms

KATHMANDU, Aug 19, 2012

The Nepal Rastra Bank (NRB), central monetary authority, can reject a proposal from the Ministry of Industry (MoI) to stop bank and financial institutions (BFIs) from auctioning the properties of six ailing industries that have long been defaulting loan.

The central bank source clarified that it was not in a position to prevent banks and financial institutions (BFIs) from auctioning the assets of the industries that have failed to make timely repayment of loan and stated that it would be against the existing laws.

NRB source stated that existing Bank and Financial Institution Act (BAFIA) doesn´t allow the monetary regulator to stop BFIs from auctioning the properties of those ailing industries until the government take decision for the special treatment of those industries regarding loan payment.

“NRB can´t direct any BFIs not to go ahead with auctioning the properties of debtors industries that have long been defaulting loan. Protection of industries from getting their properties auctioned is not possible unless government make special arrangement for those industries for their relief,” NRB source told Republica.

TheThe Ministry of Industry (MoI) had recently written to the NRB requesting to protect six struggling industries- Birat Leather Industries, Birat Shoes Company, Everest Floriculture, Nepal Boards- producers of wooden goods, Siris Herbal Company and Dolphin Manor Wildlife Resort. The letter had requested NRB to stop the auctioning of the assets of six industries for the next six months.

“NRB can prevent the auctioning of their properties only in the case if the government issues gazette provisioning that sick industries get such privilege,” the source added.

The government had formed a 8-member Sick-Industries Rehabilitation High-Level Task Force (SIRHLTF) led by Dipendra Bahadur Kshetry, vice-chairman of National Planning Commission (NPC) in a bid to seek measures to the ailing industries. However, the ministry, which has been assigned to identify actual sick industries in the country, has just started the study.

The government has already formed around a dozen committees over a decade to study the situation of the ailing industries and recommend measures to rejuvenate them. Though each of the panel suggested different measures, they never came up with a specific criteria to define sick industries.

Source: Republica

Bank staff involved in fake declarations leading to illegal indian currency (IC) withdrawals

Preliminary investigation has shown that employees of some banks have been involved in misappropriation of huge amount of Indian Currency (IC) in collusion with traders who produced fake customs' documents.

"Our initial finding suggests that bank staff assisted the business firms that produced fake demand drafts and customs declaration forms to abuse IC," said a source at the Ministry of Finance (MoF).

Officials of the Department of Revenue Investigation (DRI) who are investigating into the cases of IC misappropriation worth Rs 1 billion by eight firms confirmed that almost all customs declaration forms submitted to NIC Bank branch at Birgunj appeared to be fake.

"While studying the documents we found almost all transactions of IC through NIC Bank were based on the fake customs declaration forms," Shanta Bahadur Shrestha, director general of DRI, told Republica on Saturday. Shrestha said investigation team from DRI found that those firms produced 599 fake customs declaration forms to different banks. "However, we are still to calculate the total amount of IC misappropriation from those customs declaration forms," said Shrestha.

He said documents submitted in other banks are also suspected to be fake because the same firms are involved in transactions with those banks as well.

An investigation team that was dispatched by Nepal Rastra Bank (NRB) on Wednesday has already sought clarifications from six commercial banks through which eight firms in Birgunj managed to draw huge amount of IC by producing fake customs documents.

The NRB team led by Deputy Director Chet Prasad Upreti began investigations into the cases in Birgunj-based branches of NIC Bank, Nepal Investment Bank, Nepal Bangladesh Bank, Laxmi Bank, Everest Bank and Siddhartha Bank. Public sector bank, Nepal Bank Ltd is also under the scanner of the investigation after transactions from the bank worth Rs 8 million was found suspicious.

Those firms withdrew Rs 630 million from NIC Bank, Rs 11.8 million from Everest Bank, Rs 32.3 million from Laxmi Bank, Rs 7.7 million from Nepal Bangladesh Bank, Rs 60.4 million from Siddhartha Bank and Rs 16.4 million from Nepal Investment Bank. Those firms are also found to have opened accounts with Sunrise Bank, Nabil Bank, Global Bank and Bank of Kathmandu.

An investigation carried out by DRI had found Maxwell Computer, Shyam Galla Bhandar, Jaya Mata Di International, Digital World and GS Traders of producing fake customs documents to withdraw huge amount of IC from different commercial banks. Five proprietors of those firms have been taken into custody.

In other cases of suspected IC misappropriation, DRI has sealed Nitesh Brothers, Jaibaba Amar Nath and Gangotri Gallaghar in Birgunj and put Dinesh Gupta, proprietor of those firms, behind the bars.

Source: Republica