R&D Economic Research & Business Development
Date: May 9, 2010
Highlights
Normal life throughout the country that was badly hit by the prolonged general strike of the Unified CPN (Maoist) is returning to from Saturday after the withdrawal of the strike. Nepal's Maoists have lifted a general strike that crippled commerce for a week in the Himalayan nation. Life on the streets began returning to normal Saturday, but the political crisis enveloping the country is far from over. A day after the withdrawal of the indefinite general strike, UCPN (Maoist) Chairman Pushpa Kamal Dahal said they would sit for dialogue only after ruling parties respond to the Maoists‟ move. The Maoist chief said that the upcoming Standing Committee meeting would take decisions about holding dialogue with the ruling parties and also about the future protest programme. Unified CPN-Maoist vice chairman Dr Baburam Bhattarai on Saturday demanded an immediate ouster of the Madhav Kumar Nepal-led government. Speaking to media persons at Party headquarters, Paris Danda, Bhattarai said, "The government should resign immediately if it has morality and accountable to the people." After suspending the indefinite general strike, the UCPN (Maoist) has adopted a „wait and watch‟ strategy for a week. The Maoists, who are expecting the resignation of Prime Minister Madahv Kumar Nepal, will now focus on the government‟s response to their demands and start preparations for another indefinite strike. A senior US State Department official has said that the concerns of India, China, and the US on Nepal are the same. Stating that India, China, and the US have a convergence of views on Nepal, US Assistant Secretary of State for South and Central Asia Robert Blake asked stakeholders not to upset the balance in the Himalayan nation. Prime Minister Madhav Nepal has thanked the agitating Maoists for withdrawing their indefinite general strike. Deputy Prime Minister and Minister for Foreign Affairs Sujata Koirala on Saturday claimed that the incumbent government would successfully complete the integration and rehabilitation process of Maoist combatants at any cost. Speaking with ambassadors from Asian countries at her residence in Mandikhatar on Saturday morning, Koirala said, “People accuse the government of not working. The fact is we are not given the opportunity to perform but will show everyone now.”
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The ruling parties have hailed the Maoists‟ strike withdrawal as a “positive development” which paves the way for “expediting dialogue to form a national consensus government”. Verly likely, Nepal Rastra Bank (NRB) will provide refinancing to banks and financial institutions (BFIS) against collateral of their good loans from this week. A senior NRB official said the procedure of providing loans has already been prepared. With the banking system facing a liquidity crunch, the NRB opened the door for refinancing to ease the crisis. The BFIs are very little into new lending and struggling to provide credit even to ongoing projects in the absence of liquidity. The business community on Saturday welcomed the UCPN (Maoist) withdrawal of the nationwide indefinite general strike. On Friday evening, faced with mounting presure from different business organization, civil society, professionals and people from various walks of life the main opposition party decided to call off the strike after six consecutive days. Despite being a public holiday, banks and financial institutions in Pokhara opened on Saturday to provide services to its cash-strapped customers. Banks and financial institutions had remained closed throughout the week due to the nationwide indefinite strike called by the Maoists. Nepal Airlines Corporation (NAC) has withheld its direct flights in two hill destinations -- Nepalgunj-Salle and Nepalgunj-Chaurjahari -- where it was operating with full occupancy, citing inadequate planes and pilots. Like other sectors, the movie industry also bore the brunt of the Maoist strike that kicked in all across the country for six consecutive days. The strike caused a loss of “about Rs. 27 million” to the movie industry. There are around 250 cinema halls operating across the country, including 35 in the Kathmandu Valley. A day after the UCPN (Maoist) called off their indefinite strike, arrivals of vegetables in the capital touched a new high on Saturday. Gold price in the domestic market may go up this week as gold‟s international price is on the rise. The price of the precious yellow metal reached a fivemonth high of US$ 1211.9 per ounce on Friday at the COMEX Division of the New York Merc. According to the website www.livetradingnews.com, gold price may go up further. As Nepal‟s gold price is chiefly determined by the international price, the domestic market also may see a rise in gold price in the coming days. The inflow of remittance has witnessed a slower growth in the first eight months of the current fiscal year. According to Nepal Rastra Bank (NRB), the remittance increased by a mere 12.6 percent during the review period while it had a saw an impressive growth of 65.3 percent during the same period last year. 2
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Even after the withdrawal of their general strike, Maoist cadres have continued to shelter in schools. Hundreds of Maoist cadres returned to shelter at various schools Friday evening after dispersing from an assembly organized at Khulamanch. Industries based in the Sunsari-Morang corridor said today that they will not pay workers wages of six days, during which the industries remained shut due to the Maoist-imposed strike.
POLICY:
Situation returning to normal throughout the country Normal life throughout the country that was badly hit by the prolonged general strike of the Unified CPN (Maoist) is returning to from Saturday after the withdrawal of the strike. Vehicles are back on the street and markets have started to open. People who were stranded in various places due to lack of transportation have started heading out to their destinations. Fresh vegetables and fruits have been transported to Kathmandu and other cities in large quantities. The price of vegetables has seen a sharp decline following the extra supply. Although, government offices, most private offices and banking institutions and academic institutions and whole-sale market have remained closed today being Saturday, people are seen relieved in the hope of resuming their official works from Sunday. Most people were confined in their residences and forced to postpone their work, while many others were forced to walk to their destinations due to the bandh. Some Maoist cadres who had come from various districts to the capital and other cities for the party's general strike have started to return on their own, while others have stayed back for the mass assemblies to be organised Saturday. \ The UCPN (Maoist) has said, it will vacate schools and colleges that it has been using as temporary camps to house its cadres to allow the academic institutions run. nepalnews.com
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Despite End of Maoist Strike Nepal's Crisis Continues Nepal's Maoists have lifted a general strike that crippled commerce for a week in the Himalayan nation. Life on the streets began returning to normal Saturday, but the political crisis enveloping the country is far from over. The shutters came up on street-front shops of Nepal's capital Saturday. Nepal's business community estimates the forced shutdown cost the country's already weak economy about one quarter of a billion dollars. Tourism is the country's major industry, heavily dependent on the stream of foreign visitors. That stream has been reduced to a trickle. Airport officials say during the strike period, about 400 visitors arrived each day, while 1,500 departed. And tour bookings stopped completely when word of the strike spread internationally. Mary Pant runs a crafts shop 50 meters in front of a first-rate hotel. The area is usually crammed with tourists. After the week-long hiatus, the foot traffic is still scant. "It was a big problem. It was a tough time staying at home. It depends on the political situation. If it's nice, we'll get the tourists. If not, it'll stay on like this," she said. Traveler Fred Nolte, from the U.S. state of Maine, arrived overland from India with an adventure tour group, which, he says, is taking in stride the unusual experience. The visitors rode across Nepal as the Maoist strike began to turn violent. "They were allowing the tourist vehicles to get through. So we really didn't have any problem although another one of the trucks with another party did get one of their windows broke," he said. At the Sagarmatha Tea House on the main Lazimpat road, proprietor Ganga Rai laments what he regards as selfishness across the political spectrum for plunging his country back into crisis. "They're thinking about taking over power, taking over positions. That's not good for them, that's not good for us too, for the Nepali people, for Nepal, also," said Rai. The Maoists say their street protests will continue until Prime Minister Madhav Kumar Nepal resigns and a list of other demands are met. Some of Mr. Nepal's political allies, in a joint statement, are calling the former rebels' demands "unconstitutional and ludicrous." Local news reports quote the embattled leader as expressing his appreciation to the Maoists for ending the strike, but giving no indication he will quickly heed their demand to resign. http://www1.voanews.com/english/news/-Despite-End-of-Maoist-Strike-NepalsCrisis-Continues--93186149.html?refresh=1
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R&D Economic Research & Business Development Stir won’t stop: Dahal A day after the withdrawal of the indefinite general strike, UCPN (Maoist) Chairman Pushpa Kamal Dahal said they would sit for dialogue only after ruling parties respond to the Maoists‟ move. The Maoist chief said that the upcoming Standing Committee meeting would take decisions about holding dialogue with the ruling parties and also about the future protest programme. “The ball is in the ruling parties‟ court, and if our demands are not fulfiled within a couple of days, the agitation will take a new turn,” said Dahal addressing a mass gathering of the party at Khula Manch on Saturday. “We did not withdraw the strike bowing down to pressure, we just demonstrated our responsibility towards the people.” He assured the cadres that the party would not stop its movement until its goals are attained. “We are preparing for a new mode of agitation. The six-day-long general strike was just a rehearsal; the real drama will be staged if the peace and constitution are not ensured.” He threatened that another general strike would automatically turn into revolt if the ruling parties make any blunder or miscalculate the Maoists‟ strength. “We are preparing for a historical revolt,” warned Dahal. Flaying the intellectuals, elite and aristocrats of Kathmandu, Chairman Dahal warned them not to undermine the poor people who are participating in the movement. He said, “A handful of people who have earned some money and call themselves intellectuals are writing and speaking against the people‟s movement. People have recorded in their minds what they wrote and spoke.” The Maoist supremo said that some “monarchists and petty kings” of Kathmandu Valley were conspiring against the people. Dahal also warned the urban elite of the flame of war emanating from the villages. He censured the media saying they did not report the people‟s movement fairly. He said, “Some gangsters infiltrated our movement with knifes and weapons but the media went on reporting that the locals retaliated against the Maoist movement. How can criminal gangs‟ misdeeds be described as reprisals by the locals ?” The Maoist chief also requested the international community to advise the government to find solutions to the problems. “We know the international community wants peace and a constitution, so they have to give suggestions to the government about what should be done,” Dahal said. http://www.ekantipur.com/the-kathmandu-post/2010/05/08/nation/stir-wont-stopdahal/208051/
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R&D Economic Research & Business Development Maoists in wait ‘n’ watch mode After suspending the indefinite general strike, the UCPN (Maoist) has adopted a 'wait and watch' strategy for a week. The Maoists, who are expecting the resignation of Prime Minister Madhav Kumar Nepal, will now focus on the government's response to its demands and start preparations for another indefinite strike. "The prime minister's resignation is not the precondition for dialogue, but the ruling parties had assured us that he would quit if we withdrew the strike. We are now waiting for the ruling parties to react," Maoist leader Barshaman Pun said on Saturday. The Maoists have called a Standing Committee meeting for Sunday to prepare plans for dialogue as well as the streets. The Maoists are picketing Singha Durbar on Sunday and demonstrating in all district headquarters across the country. "We will call another indefinite strike after seven days if our demands are not met," Pun said. http://www.ekantipur.com/2010/05/08/headlines/Maoists-in-wait-n-watchmode/313917/
US, China and India ''on same boat on Nepal'' A top US State Department official has said that the concerns of India, China, and the US on Nepal are the same. Stating that India, China, and the US have a convergence of views on Nepal, US Assistant Secretary of State for South and Central Asia Robert Blake asked stakeholders not to upset the balance in the Himalayan nation. He made the statement in an interview with Press Trust of India (PTI) on Saturday. This is a first-time revelation that three power centres of the globe are engaging with one another and, more interestingly, converging and exchanging views regularly. Earlier in most of the cases, it was predicted that the US makes its perspective on Nepal through the Indian eyeglass. In the case of China, it was believed that it has a 'quiet and non-interfering' diplomatic approach to its neighbours. "There is broad convergence of views on Nepal. China, like the United States and India, wants to see stability and prosperity in this important country (Nepal)," he said. "Nepal is facing difficult issues," Blake said. "We have expressed our concern about the strikes there and the need to ensure that all parties work together to reach agreement on issues important to them so that the peace process can be concluded and stability enhanced," said Blake.
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Blake said he would give some credit to the Maoists because during the strike period they largely kept their word to keep it peaceful. "I think they made a significant effort to do so. At the same time, the best way to arrive at a solution to this is not by pressure. That is why, I issued a statement on Friday urging the Maoist to end the strike and engage in a more peaceful way with other parties," Blake said. http://www.ekantipur.com/2010/05/08/headlines/US-China-and-India-on-same-boaton-Nepal/313913/
PM thanks Maoists for strike call-off Prime Minister Madhav Nepal has thanked the agitating Maoists for withdrawing their indefinite general strike. Issuing a press statement, the prime minister expressed hope that the Maoist move will positively contribute to political parties to move ahead in the path of dialogue, consensus and cooperation. The prime minister said it is impossible to take the peace process to a logical end and promulgate new constitution without consensus and cooperation among all political parties. “There is no alternative to arriving at consensus acceptable to all by relieving unnecessary rigidity,� he said. He expressed hope that there will be national consensus for conclusion of peace process as well as promulgation of new constitution and accomplishing various tasks related to peace process including transformation of the Maoist party as a civilian party, returning of the seized properties and disbanding paramilitary structure of the Young Communist League. The prime minister also urged the agitating Maoists to seek solution to the problems through consensus among the political parties and established constitutional and democratic norms and values. He also thanked all those standing spontaneously in favor of peace and constitution drafting and expressed appreciation to entire security personnel for exercising restraint and fulfilling their duty with utmost honesty during the Maoist general strike. EU, US hail strike withdrawal Meanwhile, athe heads of missions of the European Union, as well as the Ambassadors of Norway, Switzerland and the United States, welcomed the decision of the UCPN (Maoist) to postpone their indefinite general strike.
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Issuing a press statement on Saturday, they hoped this will prove to be a decisive step in the pursuit of a solution to the protracted political deadlock. They also urged all political parties to make renewed efforts to negotiate in good faith and make necessary concessions to bring about a successful conclusion to the present crisis to the mutual benefit of all. http://www.myrepublica.com/portal/index.php?action=news_details&news_id=18370
Sujata claims govt survival Deputy Prime Minister and Minister for Foreign Affairs Sujata Koirala on Saturday claimed that the incumbent government would successfully complete the integration and rehabilitation process of Maoist combatants at any cost. Speaking with ambassadors from Asian countries at her residence in Mandikhatar on Saturday morning, Koirala said, "People accuse the government of not working. The fact is we are not given opportunity to perform but will show it now." During a breakfast meeting among human rights defenders, senior advocates, constitution experts and Kathmandu-based South- and Central-Asian ambassadors, the envoys inquired about the possibility of consensus among major political parties and a likely scenario post May 28, the deadline for the promulgation of the new constitution. Indian ambassador to Nepal, Rakesh Sood said the Nepali people are capable enough to solve the problems facing them. "All political engagement, including the formation of national unity government, should be based on consensus," he said. Chinese ambassador, Qiu Guohong expressed optimism about political stability in Nepal that the UCPN (Maoist) had rolled back its general strike. Japanese ambassador to Nepal, Tatsuo Mizuno, keen to know about a possible scenario post May 28, urged parties to forge consensus at the earliest. "Envoys stressed peace, stability and an early political consensus. It was exploring a way out of the present political problem," Minister Koirala told the Post. "The government has prioritised integration and rehabilitation of the Maoist combatants and it will not collapse until the accomplishment of these tasks." "Legal pundits differed in their opinion about the future constitutional and political course of the country. We are, however, capable enough to handle it safely," Koirala said. She also criticised the Maoist party for maintaining a paramilitary structure of its youth wing, Young Communist League. The envoys welcomed the Maoist postponement of general strike, hoping that the move would help end the political deadlock. http://www.ekantipur.com/2010/05/08/top-story/sujata-claims-govt-survival/313920/
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Consensus road open The ruling parties have hailed the Maoists‟ strike withdrawal as a “positive development” which paves the way for “expediting dialogue to form a national consensus government”. The statement came after a meeting of 15 ruling parties called by Prime Minister Madhav Kumar Nepal at his residence in Baluwatar on Saturday. The parties also said the Maoists should “withdraw all protests to make the environment conducive to consensus”. “Constitution writing and peace process can be taken to completion only through dialogue, consensus and coalition,” read a statement issued after the meeting. While the parties did not seem optimistic about any breakthrough given the conditions, individual party leaders were somewhat upbeat. “The Maoists‟ decision to call off the strike is a step towards creating an atmosphere of consensus,” CPN-UML Chairman Jhala Nath Khanal told the Post. “The ruling parties should come up with concrete steps for the formation of a national consensus government to take the peace process and constitution drafting to their logical end.” Sources said the prime minister was mulling stepping down on “moral grounds” within a week if there is agreement among parties on this score. He has been saying time and again that he will step down when consensus is forged. “The UML has already taken a decision to this effect and he will not pose any obstacle,” added Khanal. The largest ruling partner Nepali Congress (NC) has said it is ready to consider the formation of a national consensus government should the UCPN (Maoist) meet NC‟s “six conditions and completely transform itself into a civilian party.” The conditions include agreement on the modality and number of Maoist combatants to be integrated in security agencies, disbanding the paramilitary structure of Young Communist League and return of property seized by the Maoists during the conflict period, said NC General Secretary Bimalendra Nidhi. “The Maoists should give up agitation programmes and negotiate for a package deal,” said Nidhi. “We will talk about a national consensus government once there is agreement over the package.” The package deal envisages the formation of a national consensus government, numbers and modality for integration and rehabilitation of Maoist combatants, settling differences over the new constitution, transformation of the YCL and return of confiscated property. “We have agreed in principle to form a national consensus government,” said UML leader Pradip Gyawali. “We will reach an agreement very soon.” ‘PM to stay’ KATHMANDU: CPN-UML standing committee member KP Sharma Oli on Saturday said Prime Minister Madhav Kumar Nepal will not resign unless the UCPN (Maoist) proves its majority in the Constituent Assembly (CA). Oli‟s remarks come at a time when the parties have intensified groundwork to form a national consensus government incorporating the Maoists. 9
R&D Economic Research & Business Development “The Maoists want to topple the government through street pressure. It is completely illegal and unconstitutional,” Oli told an interaction in the Capital. He asked the Maoist leadership to join the incumbent government if it is concerned about constitution writing in capacity of the largest political party in the CA. “If the constitution writing process is derailed, the blame will certainly go to the Maoists,” he said. Oli said talk of a new power equation under the Maoist leadership is merely “hypothetical.” http://www.ekantipur.com/the-kathmandu-post/2010/05/08/top-story/Consensus-roadopen/208045/
BANKING: NRB may refinance banks this week Verly likely, Nepal Rastra Bank (NRB) will provide refinancing to banks and financial institutions (BFIS) against collateral of their good loans from this week. A senior NRB official said the procedure of providing loans has already been prepared. With the banking system facing a liquidity crunch, the NRB opened the door for refinancing to ease the crisis. The BFIs are very little into new lending and struggling to provide credit even to ongoing projects in the absence of liquidity. Three BFIs including Citizens‟ Bank International, DCBL and Clean Energy Development Bank have applied to NRB seeking a total refinancing of Rs. 1.19 billion. The three BFIs have sought Rs. 550 million, Rs. 500 million and Rs 140 million, respectively, according to NRB officials. As per the refinancing criteria, the BFIs can get up to 40 percent of their core capital. “All three have demanded refinancing up to 40 percent of their core capital,” said an NRB official. They will get the fund from NRB at 7.5 percent interest rate which the BFIs will have to lend to their customer at not more than 10.5 percent interest. They have sought refinancing for providing credit to sectors like hydropower, schools, hospitals, hotels and manufacturing units, according to NRB officials. Sudhir Khatri, president and chief executive officer of DCBL said he applied for refinancing in the areas of tourism and hydropower sectors, among others. “I hope refinancing will help ease the existing liquidity shortage in my bank,” he said. NRB sources said the central bank has decided to provide refinancing from its Banking Development Fund initially in which there is Rs.3 to 4 billion reserves. “We are also discussing other sources of fund within the central bank for refinancing,‟ said sources. The NRB expects it may have to provide refinancing between Rs. 10 to 12 billion. The BFIs will have to repay the loan along with interest to NRB within six
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months. Bankers expect that the liquidity crunch to end in the coming months as increased government expenditure especially in the development sector will bring cash into the banking system. Bank ATMs resume KATHMANDU: With the withdrawal of the general strike by the UCPN (Maoist), banks running 365-day services opened their branches on Saturday. The ATM counters reopened from Friday evening. President of Nepal Bankers‟ Association Sasin Joshi said the bank branches witnessed a rise of 15-20 percent more withdrawal of cash than usual. “It is natural as people had been unable to withdraw money due to the strike,” he said. Contrary to expectations, the ATM counters were not so crowded on Saturday. Joshi said the banks have enough cash for withdrawal as they had arranged for maximum cash before the general strike. http://www.ekantipur.com/the-kathmandu-post/2010/05/08/business/nrb-mayrefinance-banks-this-week/208075/
Banks avail services on Saturday Despite being a public holiday, banks and financial institutions in Pokhara opened on Saturday to provide services to its cash-strapped customers. Banks and financial institutions had remained closed throughout the week due to the nationwide indefinite strike called by the Maoists. The agitating Maoists had even prohibited their employees from going to their offices since Tuesday, while automated teller machines (ATM) were not in operation. Standard Chartered Bank, Himalayan Bank, Global Bank, DCBL Bank, Viswa Bikas Bank, Shangri-La Development Bank, City Development Bank and Om Finance resumed their services on Saturday. Their staffs had even telephoned their customers to inform that their services were available on the day. “We called up our regular customers to inform them of our services and a lot of them who were not able to withdraw and deposit money for the last several days turned up,” said Buddhi Malla, general manager of Om Finance. The finance company, which had never availed its services public holidays, had opened four of its branches, including the central office, for the service. Among them, most of the remittance transactions took place in Besi Sahar, Lamjung branch, according to Malla. Because the closure of banking services had rendered many people broke, the rush to withdraw cash was bigger than those who wanted to deposit, said bankers. They 11
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opined that this trend will go on for a week. Customers, who suffered from the lack of hard cash, expressed happiness that they were able to get banking and financial services even on Saturday. Banks that provide services 365 days a year operated for the whole day, instead of the regular Saturday schedule of 10 am to 1 pm. Those that do not regularly operate on a Saturday were open from 10 am to 2 pm. There was a big rush of people who came to get remittances sent to the banks and financial institutions over the week. “We were in trouble when we could not get the money our relatives sent us from abroad,” said a customer of Om Finance, adding “when we got a phone call that the finance company was open we came and received it.” Officials of Global bank said the bank witnessed four-fold rise in transactions on Saturday. However, as the central bank did not open ´clearance´ transaction, some customers returned their clearance check and took cash, said Mahendra Karki, operation in-charge of Global Bank. Those who had taken loans from banks and financial institutions also were able to pay their regular interest on Saturday. http://www.myrepublica.com/portal/index.php?action=news_details&news_id=18382
BUSINESS & ECONOMY:
Business sector hails strike withdrawal The business community on Saturday welcomed the UCPN (Maoist) withdrawal of the nationwide indefinite general strike. On Friday evening, faced with mounting presure from different business organization, civil society, professionals and people from various walks of life the main opposition party decided to call off the strike after six consecutive days. Issuing a press statement, Federation of Nepalese Chambers of Commerce and Industry (FNCCI) — the umbrella organisation of the private sector — said that the decision to withdraw the indefinite general strike was a positive move and that it had created an environment for forging consensus among the political parties. “Now that the strike has been called off, life has returned to normal,” said Surendra Bir Malakar, president of Nepal Chamber of Commerce. He said the ruling parties also should be flexible to form a national consensus government.
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The Confederation of Nepalese Industries (CNI) said that it welcomed the strike withdrawal decision of the Maoists. The CNI urged the political parties to end the ongoing political deadlock through cooperation and understanding and begin the process of addressing all issues in a sustainable manner. “Due to deteriorating environment, capital flight and low investment, the country is bearing the brunt of trade deficit, balance of payment deficit, labour disputes, liquidity crunch and prolonged load-shedding. Al this has disheartened the entire business sector,” the CNI statement read. Meanwhile, Hotel Association of Nepal (HAN) - the umbrella organisation of the hotel sector in Nepal — said the strike withdrawal was a welcome move. In a statement, the HAN said that the hotel industry had been suffering intensely due to rapid cancellation of bookings as well as tourists cutting short their stay and leaving Nepal. It said the recent commitment made by 19 political parties not to hinder the upcoming Nepal Tourism Year 2011 had provided respite to the tourism sector and that these parties should abide by their commitment. The Lalitpur Chamber of Commerce and Industry also welcomed the strike withdrawal decision of the Maoist party and urged it to take the peace process to its logical conclusion. Likewise the Federation of Nepal Cottage and Small Industries (FNCSI) which said that the industrial sector has had to suffer huge losses due to frequent strikes called by different parties. “We welcome the move of the Maoists to withdraw the strike and urge them to provide an environment for forming a national unity government,” said FNCSI in a statement. http://www.ekantipur.com/the-kathmandu-post/2010/05/08/business/business-sectorhails-strike-withdrawal/208072/
NAC stops flights to midwestern hill districts Nepal Airlines Corporation (NAC) has withheld its direct flights in two hill destinations -- Nepalgunj-Salle and Nepalgunj-Chaurjahari -- where it was operating with full occupancy, citing inadequate planes and pilots. The state-owned airline company was operating two flights from Nepalgunj per week to Salle in Rukum and one flight to Chaurjahari, which serves as gateway to Jajorkot.
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"The head office´s decision to stop direct flights in those sectors reached us three days ago," said Mahesh Kumar Moktan, the chief of NAC regional office in Nepalgunj. He told Republica that Nepalgunj station has stopped the flights instantly. The decision has created new difficulty for the people living in hill districts in midwestern region who were largely dependent on those flights for travel and emergency supply of goods and services. They have flayed the decision and demanded resumption of flights. "The flights have been withheld at a time when we were facing problems getting hold of tickets. This has affected us severely," said Birbal Oli, a resident of Chaurjahari. Even though Rukum is linked with the national roads network, regular passenger and cargo services are still not available in the district. Likewise, there is no bus service to Jajarkot. "NAC´s decision has cut us off from the markets and key services," said Oli. NAC official Moktan, meanwhile, said that the corporation was forced to stop the flights due to the lack of adequate number of planes and pilots. "That has forced us to cut flights across the country, not just in Jajorkot and Salle," said he. Citing similar reasons, the corporation had slashed its flights on Nepalgunj-Salle route also two years ago. Prior to that, NAC was operating four flights per week on the route. All the flights would be packed. Currently, NAC is operating flights in hill districts with four Twin otters. NAC officials further said that the corporation slashed the flights because the Ministry of Tourism and Civil Aviation (MoTCA) did not heed its request to jack up fares. NAC still operates two flights on Nepalgunj-Salle-Kathmandu route and one flight on Nepalgunj-Chaurjahari-Kathmandu route per week. But because these flights are operated as ´transit flights´, locals complained the corporation sells tickets to them only when it does not find passengers to Kathmandu. "The corporation does not sell us tickets until it finds passengers to Kathmandu. So, these transit flights are effectively not meant for us," said Oli. NAC staffs too admit this. NAC was operating flights to eight far- and midwestern hill districts, including Humla, Jumla, Rara, Bajura, Bajhang, Salle, Chaurjahari and Dolpa from Nepalgunj. The demand for flights has only grown over the years. But the corporation, citing its limitations has continued to slash and suspend flights. http://www.myrepublica.com/portal/index.php?action=news_details&news_id=18395
Movie industry incurs Rs 27m loss Like other sectors, the movie industry also bore the brunt of the Maoist strike that kicked in all across the country for six consecutive days.
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R&D Economic Research & Business Development The strike caused a loss of “about Rs. 27 million” to the movie industry. There are around 250 cinema halls operating across the country, including 35 in the Kathmandu Valley. It has been estimated that theatres nationwide failed to collect around Rs. 4-4.5 million in a day and the cumulative loss reached around Rs. 27 million in six days. The daily sales turnover of film halls in the Capital stands at around Rs. 2 to Rs. 2.5 million and outside the valley is around Rs. 2 million, according to film distributors. The strike also postponed the screening of around half a dozen Nepali movies in queue, including „Hifajat‟, „Dosti‟, „Daag‟, and „Buba Aama‟. Similarly, Bollywood releases such as „Apartment‟, „Prince‟ and „Phook-2‟ and Hollywood‟s „Avatar‟ in 3D version were halted. Nakim Udin, a promoter of Quest Entertainment Pvt. Ltd. runing Kumari and Jai Nepal film halls in Kathmandu, said his company incurred a loss of Rs. 200,000 daily during the strike. “We could not screen the much-awaited Bolly-wood release „Houseful‟,” he said. The shooting and post-production work of many movies were also postponed. Shooting of Sovith Basnet‟s „Kanyadan‟ came to a virtual halt. His movie was in mixing phase. “By this time, we would have already completed mixing, but now we are starting it from tomorrow,” Basnet said. Chabi Raaj Ojha‟s „Hifajat‟ had to halt the screening of his movie. “Our production house suffered a loss of Rs.1.6 million during the banda,” he said. Manoj Rathi, who distributes Nepali cinema outside Kathmandu, said the release of „Hifajat‟ and „Dosti‟ was severely hit. http://www.ekantipur.com/2010/05/09/business/movie-industry-incurs-rs-27mloss/313939/
Vegetable arrivals all time high in capital, fruits still scarce A day after the UCPN (Maoist) called off their indefinite strike, arrivals of vegetables in the capital touched a new high on Saturday. Bharat Khatiwada, president of Vegetables Wholesalers Association ia Kalimati, said around 2,000 tons of vegetables arrived at the Kalimati wholesale market. “Huge pile of vegetables stuck at farms for last six days have arrived in the capital after the withdrawal of the strike,” Khatiwadi told Republica. The Maoists have since Friday allowed the transport of fresh vegetables and dairy products, considering the huge loss being suffered by farmers. However, only a nominal volume of vegetables has entered the valley from other districts.
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R&D Economic Research & Business Development “Most of the vegetable products have come from the districts around the capital. Vegetables from tarai districts haven´t entered the capital as most of the traders aren´t still confident to ferry the vegetables,” said Khatiwada. Vegetables such as cauliflowers, smooth gourds, cabbages, tomatoes, better gourd, green chilly are coming in mainly from Chitwan, Dhading, Nuwakot, Kavre, Dolakha, and Makawanpur. “More than 400 tons of vegetables has arrived from Dhading alone,” said Khatiwada. Traders said with the huge arrivals in the capital, price of vegetables has gone down in the market. Fresh vegetables such as cowpeas, potatoes, smooth gourds, squash, better gourds and cauliflowers have dropped as compared the prices before the strike. Though the resumption of supplies of vegetables brought relief to the residents of capital, the farmers aren´t upbeat. Farmers are compelled to sell their products at cheaper prices due to abundant supplies on Saturday. However, fruits wholesale market in Kuleshwar, the largest fruit market of the country, is still to see the resumption of supplies as most of the fruits to be imported from China and India. “It takes at least two days to arrive fresh fruits in the capital. Highly perishable fruits such as watermelon and papaya have been exhausted.We are selling fruits whatever available in our stocks,” said Deependra Shrestha, treasurer of Fruits Wholesalers Association in Kuleshwar wholesale market. http://www.myrepublica.com/portal/index.php?action=news_details&news_id=18381
MARKET: Gold price likely to rise Gold price in the domestic market may go up this week as gold‟s international price is on the rise. The price of the precious yellow metal reached a five-month high of US$ 1211.9 per ounce on Friday at the COMEX Division of the New York Merc. According to the website www.livetradingnews.com, gold price may go up further. As Nepal‟s gold price is chiefly determined by the international price, the domestic market also may see a rise in gold price in the coming days. The price of gold in the international market rose as people chose gold as a safe haven amid worries over Europe‟s debt woes, according to the report.
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Tej Ratna Shakya, president of Nepal Gold and Silver Dealers Association, said the rise in price at the international level and political problems could contribute to a rise in gold price here. The price of gold rose in the domestic market to Rs. 34,130 per tola on Friday from Rs. 32,612 per tola the preceding Friday. On the other hand, permission to import a limited quantity of gold in order to address the current balance of payment deficit is also contributing to the rise in gold price at the domestic level. However, Shayka insisted they were not facing the pressure of increased demand at the moment due to the recent banda and also because there is no auspicious day for weddings during April-May this year although it is traditionally the matrimonial season. According to him, they have already received 200 kg of gold from the banks and additional 150 kg is in the pipeline. Only banks can import gold and they are entitled to import up to 10 kg a day as per the latest provision of the Nepal Rastra Bank. During the wedding season, there is a demand for 30 kg of gold per day. http://www.ekantipur.com/the-kathmandu-post/2010/05/08/business/gold-pricelikely-to-rise/208074/
Inflow of remittance sees slower growth The inflow of remittance has witnessed a slower growth in the first eight months of the current fiscal year. According to Nepal Rastra Bank (NRB), the remittance increased by a mere 12.6 percent during the review period while it had a saw an impressive growth of 65.3 percent during the same period last year. The adverse repercussions of the last year's economic meltdown have been ascribed to a slower growth of the inflow of money sent by Nepali laborers working abroad. Primarily, the reduction in working hours in the major labour destination countries for Nepalese laborers contributed in the slackness in remittance growth. The country has received Rs 209.69 billion as remittance in the last fiscal year. The remittance, which has been helping the shaky economy afloat, contributed 21 per cent to the gross domestic product (GDP) in the last fiscal year. According to some experts, the country's excessive reliance on the export of manpower to run its economy will prove counterproductive in the long run. They have also been demanding the government to come up with concentrated plans and programmes to leverage the potentials of a large chunk of Nepali youths in home for sustainable socio-economic development. nepalnews.com
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GENERAL:
Maoists to keep sheltering at schools Even after the withdrawal of their general strike, Maoist cadres have continued to shelter in schools. Hundreds of Maoist cadres returned to shelter at various schools Friday evening after dispersing from an assembly organized at Khulamanch. Even as all public and private schools, which were forced to shut down for almost one week, prepare to reopen from Sunday, the Maoists have not stopped using them to house their cadres ferried into Kathmandu Valley from across the country. The Maoist cadres have been sheltering mainly at schools in the vicinity of the 26-km Ring Road to facilitate hitting the streets for their ´decisive battle´. "Yes, our cadres are still in the schools," Mangal BK, president of All Nepal Public Health Workers Association (ANPHWA), said. "And we will continue to shelter in the schools. But we are sincere not to hamper classes." According to BK, the number of Maoist cadres, who flocked to the capital to enforce their strike, has dwindled as some of them have returned home to rest. "The number of remaining cadres is not unmanageable," he said. "So we can easily accommodate them [in schools] without hampering classes." BK said that the Newa State Committee of the Maoists, which has been entrusted with the responsibility for room and board for their cadres, would not use any of the classrooms. Instead, the committee would occupy empty spaces such as under-construction buildings or abandoned halls, to accommodate their cadres, BK said. "More importantly, our cadres would be on the streets during the daytime," he said. "They will return to the shelters only by evening. Therefore, there is no possibility of our cadres´ presence affecting classes." However, Rajesh Khadka, president of Private and Boarding Schools´ Organization of Nepal (PABSON), stated that the Maoists must drive their cadres out of the schools. "I hope the Maoists would stop using our schools as shelters as their strike has already been called off," Khadka said. He did not buy BK´s argument about using schools as shelters without hampering regular classes. "Of course, the Maoists sheltering in schools will affect classes," Khadka summed up. "They must stop this." Earlier, in the lead up to their general strike, the Maoist student union had called an educational strike on the pretext of a fee-hike row, closing down over 8,000 private schools across the country. After forcing around 1.5 million students to stay away from classes, the Maoists used the closed schools as shelter for their cadres. "With the ending of the fee-hike row, the Maoists have no justification for using the schools as shelters any more," said Bhoj Bahadur Shah, former PABSON president. http://www.myrepublica.com/portal/index.php?action=news_details&news_id=18400 18