Finance Minister Ram Sharan Mahat said that second tier reforms have become necessary to help achieve higher economic growth and lead the country to prosperity.
“Since the peace process has largely completed and only constitution making is remaining, it’s high time we focus on economic growth,” he said at an interaction organised by Independent Business News here today.
Legislative reforms, governance reforms and reforms in public enterprise would be key in second generation reforms, he added.
The major focus of the legislative reforms will give to regulators that have seen tremendous growth but ahs also witnessed some irregularities too,” Mahat said, adding that weak regulatory framework has encouraged irregularities in the financial sector. “The government is introducing new Bank and Financial Institution Act (BAFIA), apart from a new Nepal Rastra Bank (NRB) Act that will give more power to the central bank to liquidate troubled banks and financial institutions.”
Likewise, vulnerability in the cooperative sector also calls for better regulation, he added.
Mahat also informed that the government is planning to bring new Electricity Act, Special Economic Zone Act and new Labour Act that will ensure policy reform to create investment climate.
On the same occasion, former vice-chairman of National Planning Commission (NPC) Shankar Sharma, said that the reforms alone could not succeed until there is power to run industries. “Reforms cannot succeed without the more power plants and transmission lines,” he said, adding that power is a must to attract investors. “It was a different story back then when the first generation reform was started.”
Likewise, central bank governor Dr Yubaraj Khatiwada stressed on deep-rooted reforms, particularly to address problems related to legislation and governance. “The reforms should be inclusive and employment oriented,” he said.