Tourism entrepreneurs urge NRB for relief package through new monetary policy – myRepublica

POKHARA, July 3: Tourism entrepreneurs have urged the Nepal Rastra Bank (NRB) to provide a special relief package to save the tourism business that has been hit by the coronavirus infection.

The Pokhara Hotel Association organized a discussion with industrialists in Pokhara on Saturday to provide suggestions to the NRB on the new monetary policy to be released in a few days. On this occasion, association chairman Laxman Subedi sent written suggestions and demands to NRB Governor Maha Prasad Adhikari.

Stating that the budget presented on May 29 failed to address the problems of the tourism sector, Speaker Subedi said the monetary policy should address the problems of entrepreneurs. He also said that 30 percent of businessmen and a large number of employees have fled due to Covid-19. “Entrepreneurs were displaced, a large number of jobs were lost,” Subedi said.

He also said that some small entrepreneurs have survived thanks to the life-saving fund introduced by the Gandaki provincial government. Subedi said that NRB should come out with a policy to save the entrepreneurs as some of them survived last year when they got soft loans. Stating that the financial condition of the hotel and tourism industry is not comfortable so far, the association requested the NRB to take measures to keep a separate account for the interest due till mid-July 2081 and not to impose any sanctions.

Similarly, the association has proposed to make concessions on the loan processing fee by providing additional loans required by hotels at a low interest rate. “Although the coronavirus infection has decreased, the tourism sector has not had a chance to flourish. Business is still weak,” Subedi said. “So it will be easier for financial institutions to provide loans.”

The association also demanded that the hospitality industry be given an “incentive to repatriate” just like companies that bring in foreign exchange through exports. The association also suggested the NRB to increase the concessional loan limit from Rs 200 million to Rs 500 million and form a committee involving the private sector to monitor whether all hotels get such loans.

“Existing loans must be rescheduled for at least three more years and arrangements must be made to pay and repay the capitalized interest in pro rata long-term installments,” said the demand letter sent by the association. Similarly, the association demanded that the service charge charged by banks for using a credit card should be reduced to one percent from three percent and Indian notes of 500 rupees and 2000 rupees should be accepted in Nepal and any currency of SAARC countries should be accepted by banks here. “Right now, Indian tourists have to carry money in their bags,” he said. “It needs to improve.”

The association also proposed that the 100 percent letter of credit surcharge imposed by the state on imports be reduced to 10 percent. Stating that the tourism business is going through a difficult situation, the association also asked the NRB to take measures to prevent banks and financial institutions from charging fines, repaying the loan and auctioning the entrepreneurs’ collateral.

In the discussion with the entrepreneurs, Governor Adhikari said that the economy of Nepal has gone through a challenging situation and the huge gap between imports and exports has hampered the economy.

As investment in tourism is a long-term investment, the entrepreneurs raised issues such as the need for banks to treat loans and interest collections accordingly, banks should not torture businessmen for repayment of loans and interest, bankers and businessmen should be distinguished, the refinancing period should be extended, duties on manufacturing and luxury items should be different, bank interest should be in single digits.