Kathmandu: Finance Minister Dr Swarnim Wagle has emphasized the importance of maintaining the central bank’s autonomy while ensuring essential coordination with the government to achieve national economic objectives.
Speaking at a meeting of the Finance Committee under the House of Representatives regarding the Nepal Rastra Bank (NRB) Act Amendment Bill, the Minister clarified the relationship between the state and its monetary authority. He noted that the current provision of having the Finance Secretary on the NRB Board serves as a vital bridge, facilitating the communication of government perspectives and policy priorities to the bank.
According to the Minister, this structure ensures that the central bank’s monetary policy acts as a complementary pillar to the government’s fiscal policy, a synergy that is currently being practised to maintain economic health.
Minister Wagle further observed that global best practices suggest central banks should remain insulated from political influences and election cycles—a principle that Nepal’s legislation seeks to uphold. However, he maintained that independence should not be mistaken for total separation, as both the government and the NRB must work in tandem toward the shared goals of price stability, economic equilibrium, and the promotion of production and employment.
He clarified that while international factors, such as the conditions of the IMF’s Extended Credit Facility, play a role, the primary motivation for the bill is to modernize the NRB’s internal structure, the qualifications of its leadership, and its institutional relationship with the government to meet contemporary standards.
Highlighting the rapid pace of global change, the Finance Minister stressed that the legal framework must evolve to keep up with technological advancements, particularly with the emergence of digital currency. He stated that the proposed amendments are crucial for making older laws time-relevant and technologically sound.
The overarching goal of this legislative reform is to refine the board’s composition and update the eligibility criteria for its officials, thereby creating a more robust and modern central bank capable of navigating the complexities of a shifting financial world.
Comment Here