How do you see the current state of industries?
Although industries and businesses have started to roll gradually, they will take a long time to come back to their previous or pre-April 25 stage. Although we are still assessing the damage in the industrial and business sector, the early indication has shown that they have suffered huge losses.
What do you suggest now?
The government needs to come up with a program for Business Recovery. CNI has been working in this direction. There is also the need to have short-term and long-term infrastructure rebuilding programs. After the completion of relief and rescue, the time is for reconstruction now. The government must launch this.
What role has CNI played?
With its Social Corporate Responsibility, CNI actively took part in distribution of relief materials to the victims of earthquake. CNI distributed blankets, food items, noodles, lentil, beaten rice and tarpaulin.
What should be the priority now?
The first priority should be immediate relief and rehabilitation of earthquake victims. Similarly, the government needs to announce immediate and long term strategy to bring stability in economy. If we are unable to bring change, there is a possibility of more problems in case of depression and de-growth of our economy. We have already handed over our suggestions to finance minister, vice chairman of National Planning Commission and governor of Nepal Rastra Bank.
How do you see the implications to the economy?
The economy has slowed down and will continue to slow for coming weeks and months. Thus, we are stressing the need for stabilizing the economy and getting some semblance of growth and control is of equal importance in medium and long term. The risk otherwise is to get into a vicious cycle of depression and growth, further compounding the challenges of relief for the country.
How do you see the relief and rehabilitation work?
Relief and rehabilitation are going on but there is a lot more to be done. Many have lost life and savings and are without insurance cover. Getting them somehow back on their feet is vital to revival of economy.
What does the government need to do as immediate steps?
The government needs to encourage teamwork between the government, non-profit sector and private parties. Similarly, there is the need to have a business recovery plan for small and medium enterprises. There is need of reform in fiscal and monetary policies by bringing down the current interest rates to avoid the danger of reverse cycle of depression. Similarly, corporate tax must be reduced by 5 percent across the board for three years. The government should also consider reducing the VAT rate to 10 percent for one year period to help stimulate demand. Another equally important aspect is strengthening institutions. To ensure the insurance sector remains stable in this crucial period, the government should extend a line of credit to each insurance company (possibly as a % of the premium they collect- average of 25 crores per company. This line of credit should be available for a period of 5 years at the interest rate of 3 percent. Along with the policy measures, the government also needs to look at tax and customs and other areas.
Have you talked about these aspects with the government?
CNI has already handed over its suggestions to the government.