Finance Minister Wagle released Economic White Paper: Emphasis on transparency and stability in the capital market

Finance Minister Dr. In the 'Current Economic Status Paper of Nepal' (White Paper) published by Swarnim Wagle, a clear policy has been presented to link the capital market reform of Nepal with the wider economic transformation. The white paper seems to aim to take the capital market out of the limited scope of stock trading and directly link it to production, investment and job creation. As mentioned in the white paper, the economy has become more dependent on the service sector as the contribution of the manufacturing sector remains weak in the current economic structure. In such a situation, it has been pointed out that it is essential to increase the flow of investment in sectors like industry, hydropower, production and infrastructure by using the capital market. For this, the government has introduced a policy to encourage manufacturing companies to list in the stock market.

In this context, the White Paper has also given high priority to the issue of bringing in investment from Non-Resident Nepali (NRN). Pointing out that Nepalis abroad have great capital, skills and experience, it is pointed out the need for legal and policy reforms to connect them with Nepal's capital market and production sector. It is expected to expand the sources of long-term investment within the country and contribute positively to foreign exchange earnings and economic stability.

The white paper has emphasized the need to widen the scope of the capital market. While the market is currently focused on limited companies and investors, the entry of new companies, regional diversification and the need to develop new investment tools are pointed out. For this, it has been mentioned that the bond market should also be strengthened by developing financial instruments such as government bonds, corporate bonds, mutual funds. Similarly, the government is committed to maintain transparency, reliability and stability to solve the problems seen in the secondary market. The white paper points out the need to empower the regulatory body to control distortions such as abnormal fluctuations in the market, information asymmetry, and insider trading. It is expected to help in building a long-term stable market while increasing investor confidence.

The white paper has also given equal importance to the aspects of legal and institutional reforms. For the development of the capital market, it has been pointed out that the existing laws should be revised in time, the capacity of the regulatory bodies should be enhanced and the enforcement side should be strictly enforced. It is believed to help make the market orderly, safe and investment friendly. In addition, it is emphasized that the capital market should be coordinated with the overall financial system and the interconnection with the banking sector, insurance sector and other financial institutions should be strengthened. It is expected to contribute to economic growth and job creation through effective mobilization of financial resources.

Overall, the white paper released by Finance Minister Wagle has laid out a clear strategy to structurally reform Nepal's capital market to make it productive, transparent and stable. If the plan to bring in NRN investment, give priority to the productive sector and strengthen the market through legal reform is implemented, it is expected that an important foundation will be prepared to advance Nepal's economy in a sustainable and independent direction.