Kathmandu: President of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI), Chandra Prasad Dhakal, has expressed concern that the proposed amendment to the Bank and Financial Institutions Act (BAFIA) could negatively impact Nepal’s overall economic activity.
Speaking at a programme organized by Financial Institutions Coordination Department of the Nepali Congress Party on Tuesday in Kathmandu, Dhakal warned that if the proposed BAFIA amendment is passed in its current form, it could have serious consequences for the country’s economic landscape.
He particularly objected to the provision in the draft bill that seeks to separate bankers from industrialists.
“This issue of separating businesspersons and bankers must be taken seriously. It could create major complications in the economy. On one hand, promoters are expected to be held accountable and given 51 percent ownership, but at the same time, the bill defines ‘related parties’ in such a way that any investor with over 1 percent shareholding would not be allowed to take a loan. If that provision is passed, there’s a risk that many industries and businesses will shut down,” Dhakal stated.
He emphasized that there is no alternative to encouraging the private sector for economic development. Citing recent government actions aligned with FNCCI’s recommendations—such as the formation of a high-level economic commission, the amendment of 30 different laws based on the commission’s guidance, and the private-sector-friendly priorities in the national budget—Dhakal noted that these initiatives have generated optimism within the business community.
“For years, we’ve been saying that policy reforms and an investment-friendly environment are essential for Nepal’s economic prosperity. The current government, which includes the major ruling party Nepali Congress, has taken commendable steps toward policy reform. The fiscal year 2025/26 budget has recognized the private sector as a key driver of economic growth and committed to prioritizing economic reform. This has made the FNCCI hopeful and encouraged,” he said.
Dhakal also underscored the need to shift from a negative outlook to a positive one, stressing that Nepal has vast economic potential.
“The government has already made several policy reforms. We’re receiving record-high remittances, foreign currency reserves are strong, and bank interest rates have decreased. These are favourable conditions for investment, and we must view them positively,” he added.
Further emphasizing the importance of mobilizing both domestic and foreign capital for development, Dhakal shared that FNCCI has taken the initiative to establish Nepal Public Limited Company with an initial capital of Rs 10 billion.
The company has begun investing in various sectors, aiming to drive development through internal capital mobilization.
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