The government has finally decided to declare 10 industries of private ones to revive through providing tax waiver and other incentives.
Wednesdays’ cabinet´s Economic and Infrastructure Committee meeting decided to this effect. Yam Kumari Khatiwada, joint secretary of Ministry of Industry (MoI) confirmed that the committee has agreed to declare them the sick industries however she maintained that minutes of the meeting are yet to be finalized.
According the Industrial Enterprise Act the sick industries can enjoy the tax or fee waiver of any kind in the import of machineries and equipments to diversify and expand the listed industry.
MoI had collected application from the interested industries to be listed in the ‘sick category’ and a technical committee had assessed their status on some five indicators.
The decision of the committee also says that the sick industries can enjoy facilities as per laws of their concerned sectors. In addition to the mandatory directives of Nepal Rastra Bank all the Banks and Financial Institutions has to set up a separate desk to deal with the cases of the sick industries for monitoring and problem solving of those sick industries.
There are different incentives provisioned in the policies, circulars and directives of the Nepal Rastra Bank to enable industries to gain its previous status.
Indicators includes of the industries operating below the capacity of 20 percent and in loss for the last consecutive five years, with the 150 percent ratio of loan amount without compound interest, black-listed by the banks, industry faced natural calamities or the situation of beyond its control and have a record of contributing in the country’s Gross Domestic Product and job creation.
NRB INCENTIVES FOR SICK INDUSTRIES
- Refinancing on collateral of the industry at 1.5 percent interest rate
- Loan restructuring depending on industry’s business plan
- Waive the fine on interest and keep simple interest separately from the capital and recover later.
- If the BFIs not interested in refinancing, they should permit debtors at the base rate and continue in credit facility
- If the industry pays loan regularly for two years from loan restructuring date, the loan loss provisioning should be at only one percent
Nepal Boards Limited, Bara
Birat Leather Industries, Hetauda
Birat Shoe Industries, Kathmandu
Basulinga Sugar and General Industries, Kailali
Sumi Pharmacueuticals, Mukundapur , Nawalparasi
Fluer Himalayan Pvt Limited
Shree Antu Tea Industries
Gaida Wildlife Camp , Chitwan
The Fulbari Resort Pokhara
Dophins Manners Hotel Bardiya