5-step process to open a capital account, NRNA should be facilitated to invest in the capital market
क्रिप्टोकरेन्सीमार्फत हुने रेमिट्यान्स तथा भुक्तानी प्रणालीको विस्तारलाई नियमन गर्नुपर्ने
लगानी न्यूज
. KATHMANDU: Nepal Rastra Bank (NRB) has released a report with important policy recommendations on liberalization of foreign exchange policy and capital flow management in Nepal. Nepal Rastra Bank (NRB) has released its report titled ‘Foreign Exchange Policy Liberalization and Capital Flow Management-2025’.
TAG_OPEN_div_28 The report states that Nepal should gradually move towards capital account liberalization and adopt a clear strategy for the same. According to the report, Nepal has achieved full convertibility in its current account since 1993. However, the report points out that institutional, legal and policy preparations are still needed for capital account liberalization.
The report states that Nepal should move towards a flexible exchange rate system in the long run as it currently has a system based on a stable exchange rate with the Indian rupee.TAG_OPEN_div_26 Similarly, the report made public by the Nepal Rastra Bank has stated that the process of opening the capital account should be started in five stages.
In the first phase, foreign direct investment (FDI) and long-term strategic investment will be preferred, in the second phase non-resident investors will be allowed to invest in the stock market, and in the third phase, foreign investment will be opened up in government bonds.TAG_OPEN_div_24 After that, in the fourth phase, the target is to liberalize short-term external debt and banking resources and in the final stage, complete liberalization.
} The report points out that a strong macroeconomic base is necessary to make capital account liberalization a success. Fiscal discipline, low inflation, transparent capital flow and strong regulatory mechanism are the primary prerequisites.
Similarly, Nepal Rastra Bank (NRB) has suggested strengthening foreign currency reserves, extending currency swap agreements with neighbouring countries including India and developing an effective information system for monitoring capital flow.TAG_OPEN_div_20 It also pointed out the need to regulate the expansion of remittances and payment systems through cryptocurrency.
The report said that potential risks should be mitigated through foreign exchange intervention, capital flow management, coordinated use of macro-prudential policy and monetary policy.
In particular, the report states that the active role of the Nepal Rastra Bank is indispensable in the implementation of the policy.TAG_OPEN_div_16 It is believed that such policies will have a positive impact on the economy only through effective implementation.
प्रतिक्रिया दिनुहोस्