R&D_NewsBrief_19thJul

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Date: July 19, 2010

Highlights

Expressing deep concerns over the lingering liquidity shortage, Nepal´s apex

consortium of industrialists has urged the central bank to lower the Cash

Reserve Ratio (CRR) by 50 basis points to five percent in order to ease

ongoing liquidity shortage that has choked the much-needed investments to

the industrial sector.

Amid complaints of overcrowding of the banks and financial institutions

(BFIs) in the country, an upcoming bank under process of getting license from

Nepal Rastra Bank (NRB) has decided not to open. The promoters of the

proposed State Bank of Nepal last week applied to the central for withdrawal

from licensing process although they already deposited 5 percent of paid up

capital as per the licensing policy.

The Confederation of Nepalese Industries (CNI) on Sunday suggested to

Nepal Rastra Bank to formulate policies to enable venture capital and private

equity funds to be set up in Nepal which is a means of funding high risk and

Greenfield projects.

The Extreme Everest Expedition 2010 has successfully completed its goal of

clearing garbage from the ―Death Zone‖ above 8,000 m on Mt. Everest. A

team of 20 Sherpas led by Namgyal Sherpa under the coordination of Chakra

Karki set out to Everest Base Camp on April 25 and cleared out 1,800 kg of

garbage, equally divided between degradable and non-degradable waste. The

trash was piled onto a symbolic mountain at Everest Base Camp.

China is expanding its engagement with Nepal by building what is being billed

as the biggest land port connecting it with the South Asian region as a whole.

This is seen by observers as part of a larger move to connect Xigaze with

Nepal by rail.

Amlekhgunj depot of Nepal Oil Corporation (NOC), which is infamous for

series of irregularities, has been once again marked as the highest loss-making

depots among operation in Nepal.

Two new four-star hotels are beginning operation in Kathmandu Valley right

on the eve of Nepal Tourism Year 2011. Implementing Expert Group (IEG) -

the investment group of businessmen and professionals involved in

international trade - is preparing for the grand opening of the new hotels - Red

Rose Apartment Hotel at Pulchowk and Airport Hotel near Tribhuvan

International Airport - in December.

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Nepal Stock Exchange (NEPSE) began the new fiscal year on a dismal note on

Sunday. The secondary market dropped 9.2 points when the market closed for

the day. Except for the hotel groups’ index; a fall in the indices of all other

groups listed in NEPSE led the secondary market to come down to 468.53

points.

The price of gold declined by Rs 215 per 10 grams in the local market on

Sunday. The yellow metal was traded at Rs 30,090 that day against last week’s

price of Rs. 30,305 per 10 grams. ―The price of the yellow metal has gone

down due to low demand in the international market as the European economy

has improved,‖ Tej Ratna Shakya, president of Nepal Gold and Silver Dealers’

Association, told the Post.

Ruling CPN-UML standing committee on Sunday begun discussion on new

government leadership just three days before the parliament votes to elect a

new prime minister.

The alliance of 10 fringe political parties has decided to back the Maoists to

lead the new government saying that only the Maoists can institutionalize

federalism, secularism and republicanism.

A day after the Nepali Congress chose the party´s Parliamentary Party Leader

Ram Chandra Poudel as its prime ministerial candidate, the party on Sunday

expedited talks with other political parties to court their support for

government formation.

Four Madhes-based and 18 fringe parties Sunday expressed their serious

disagreement over the recent decision of three major parties – Nepali

Congress, UML and UCPN (Maoist) – to form the State Reconstructing

Commission (SRC).

Senior Vice Chairman of the UCPN (Maoist) Mohan Baidhya on Sunday said

the country would face a disaster if a majority government was formed by

bypassing his party.

Foreign Secretary Madan Kumar Bhattarai on Sunday upheld his ministry´s

previous decision to award the tender for printing machine readable passports

(MRPs) to France-based Oberthur Technologies. Taking up two separate pleas

filed by Indonesian Perum Peruri and British De La Rue to review the earlier

decision, Bhattarai took the decision after the ministry could not verify the

charge against the French security printer through diplomatic channels.

The Constituent Assembly (CA) amended its calendar of events for the

eleventh time on Sunday to continue the task of constitution drafting on

schedule.

The government has initiated process to amend the Industrial Enterprises Act,

2049 for the second time. The amendment process has been taken ahead in

line with the Industrial Act, 2067.

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Due to the non-cooperation from political parties, District Development

Committee (DDC), Kailali, was uncertain where or how to invest budget

during the fiscal year of 2009/10.

Manakamana Cable Car recorded the highest number of passengers - over

800,000 - during the current fiscal year, Karobar daily reported. According to

Manakamana Darshan Pvt. Ltd, the number of passengers has increased by

around 200,000 this current fiscal year compared to last year. It has also

collected around Rs. 250 million from the operations of the cable car.

Koshi River has begun breaching an embankment at Pulthegauda of Sunsari

district, putting human settlements nearby at flood risk. Rising water in the

river has devoured a large section of the eastern embankment, said officials of

Water Induced Disaster Control Office in Biratnagar. Efforts to control the

swollen river have failed.

BANKING:

Take steps to ease liquidity shortage: CNI

July 18: Expressing deep concerns over the lingering liquidity shortage, Nepal´s apex

consortium of industrialists has urged the central bank to lower the Cash Reserve

Ratio (CRR) by 50 basis points to five percent in order to ease ongoing liquidity

shortage that has choked the much-needed investments to the industrial sector.

In a set of suggestions forwarded to Nepal Rastra Bank for its upcoming Monetary

Policy for the current fiscal year, Confederation of Nepalese Industries (CNI) has

argued that the proposed reduction of CRR will help inject additional liquidity in the

banking system, thereby helping the banks lower the rising lending rates.

In a press statement issued on Sunday, CNI urged the central bank to defer the

implementation of Statutory Liquidity Ratio (SLR) in view of the liquidity shortage

and recognize vault cash maintained by the bank as part of SLR.

"This will help increase funds available for lending by the banks for its borrowers,

which remains a major impediment for the growth of the business sectors," said the

statement.

The statement has also asked NRB to permit domestic banks and corporate to have

access to abroad financial resources, considering the current liquidity problems in the

country and also to fund larger projects in Nepal.

The government should seriously consider facilitating institutional investors as well as

NRNs from outside Nepal to invest through Nepal Stock Exchange (Nepse) and it

should also initiate preparations for integrating Nepalese capital market with the

international capital market, probably India, the statement added.

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Regarding the long-running confusion over the polices adopted by NRB and

Securities Board of Nepal (SEBON) regarding the dilution of promoters´ share at the

financial institutions, CNI has urged both the regulators to facilitate sale of promoter

shares in a more practical manner.

CNI has also advised the central bank to start working on formulating polices for

initiation of venture capitals and private equity fund with due regulatory mechanism.

It had also sought permission to allow regular Nepalese taxpayers to invest reasonable

amounts overseas in foreign currency in line with the examples set by our neighboring

countries.

"This will help the Nepalese investors create wealth outside the country which will

eventually be brought back to the country," the statement added.

In order to effectively manage the NPA of financial institutions, the government and

the central bank should be serious in setting up Asset Management Company, CNI

said. It further urged NRB to initiate a strong lobby with the government for the

implementation of the Secured Transaction Act and effectiveness of the Debt

Recovery Tribunal.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21182

Buddding bank gets pre-debut cold feet

JUL 18 –

Amid complaints of overcrowding of the banks and financial institutions (BFIs) in the

country, an upcoming bank under process of getting license from Nepal Rastra Bank

(NRB) has decided not to open.

The promoters of the proposed State Bank of Nepal last week applied to the central

for withdrawal from licensing process although they already deposited 5 percent of

paid up capital as per the licensing policy. ―The promoters have also asked the NRB

to withdraw the deposited amount that they can get back,‖ said a senior NRB official.

As per the bank licensing policy, the promoters should deposit 5 percent of paid up

capital in the central bank before they get principle nod to establish a bank. The new

bank’s promoters had applied to NRB in 2008 to open the new bank. One of the

promoters of the proposed bank also confirmed their withdrawal decision saying that

they didn’t see the viability of additional bank amid current economic situation of the

country. ―With cost of fund of the banking going up, we didn’t see viability to

establishing the bank,‖ said one of the promoters.

The proposed bank has 141 promoters inlcuding businessmen Kamal Kumar Begani,

Karma Ghale, Kumud Dugar, Naresh Dugar, Shekhar Golchha, Pashupati Murarka

and Prakash Mundada. There are already 27 commercial banks under operation and

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other three Century Bank, Commerze and Trust and Civil Bank have already received

letter of intent to open the banks and fourth under process was this bank.

The NRB has been holding up the new licensing until new decision is taken and the

new monetary policy to be released soon is expected make certain new provisions

regarding the bank license.

The NRB official has termed the decision of the promoters of the proposed State Bank

of Nepal as bold and correct one, saying that they could not expect profits at for initial

five years and the profits also would not be as big as big they could earn from other

businesses. ―The decision of a professional group to backtrack from opening new

bank will also discourage those seeking to open new BFI,‖ said the NRB official.

The NRB is under pressure from international institutions such as International

Monetary Fund (IMF) to adopt stringent provisions while awarding bank license.

―The larger number of financial institutions is straining the NRB’s regulatory capacity

that contributes to excessive risk taking,‖ latest report of the IMF said.

http://www.ekantipur.com/the-kathmandu-post/2010/07/18/business/buddding-bank-

gets-pre-debut-cold-feet/210610/

CNI presents wish list to central bank

JUL 18 -

The Confederation of Nepalese Industries (CNI) on Sunday suggested to Nepal Rastra

Bank to formulate policies to enable venture capital and private equity funds to be set

up in Nepal which is a means of funding high risk and Greenfield projects.

There are currently no such institutions, and the CNI says it will also help strengthen

corporate management. The apex body of the industrial sector also asked in its

recommendation that the central bank make it a priority to establish asset management

companies to manage non-banking assets effectively. Establishing such a company

was part of managing the NBA of the two biggest banks Rastriya Banijya Bank and

Nepal Bank Limited under the financial reform programme which is yet to be

opened.

In another recommendation, the CNI has asked to allow corporate houses, banks and

financial institutions to raise resources directly from abroad under external

commercial borrowings.

―Considering the current liquidity problem in the country and also to fund larger

projects in Nepal, corporate houses and banks need to have access to foreign financial

resources through various forms including borrowing from foreign banks and

corporations,‖ it said. The CNI also demanded that the NRB consider allowing regular

Nepali taxpayers to invest reasonable amounts overseas in foreign currency.

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―This will help Nepali investors to create wealth outside the country which will

eventually be brought back to the country and will also help build skill and develop

the risk-taking ability of entrepreneurs.‖ it said.

However, government officials recently said that it would not allow investment

abroad at the moment when the country was facing an acute balance of payments

deficit.

Regarding the capital market, the CNI said that appropriate rules and regulations that

would support and assist private and listed companies in the stock market to raise

resources in the domestic market through instruments such as bonds and debentures

should be formulated and implemented.

The CNI has also spoken for the issuance of municipal bonds to allow municipalities

to finance their infrastructure projects.

http://www.ekantipur.com/the-kathmandu-post/2010/07/18/business/cni-presents-

wish-list-to-central-bank/210611/

BUSINESS & ECONOMY:

Trash hashed from Everest Death Zone

JUL 18 –

The Extreme Everest Expedition 2010 has successfully completed its goal of clearing

garbage from the ―Death Zone‖ above 8,000 m on Mt. Everest.

A team of 20 Sherpas led by Namgyal Sherpa under the coordination of Chakra Karki

set out to Everest Base Camp on April 25 and cleared out 1,800 kg of garbage,

equally divided between degradable and non-degradable waste. The trash was piled

onto a symbolic mountain at Everest Base Camp.

The degradable waste was brought to Namche Bazaar and handed over to the

Sagarmatha Pollution Control Committee. The non-disposable garbage was carried by

yaks and jopkyos to Lukla airport and flown to Kathmandu, said a press statement

issued by Nepal Investment Bank, the major sponsor of the programme.

The team also retrieved two bodies — of Swiss climber Gianni Goltz, who died last

year, and of Russian climber Sergey Duganov.

―We are very happy to see our dream materialize, something that we never thought

would happen. The volunteers carried almost 200 kg of garbage down with them.

Everyone was so sincere about their contribution,‖ said Namgyal Sherpa.Immediate

past president of the Nepal Mountaineering Association, said, ―The snow-capped

Himalaya of Nepal is gradually shrinking due to global warming, exposing the threat

of a tsunami among the people living below the mountains.

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Sherpa added that the threat was to 1.3 billion people whose source of water directly

and indirectly depends on the water flowing down from the Himalaya.

http://www.ekantipur.com/the-kathmandu-post/2010/07/18/business/trash-hashed-

from-everest-death-zone/210613/

China building 'biggest' land port to connect with South Asia via Nepal

BEIJING: China is expanding its engagement with Nepal by building what is being

billed as the biggest land port connecting it with the South Asian region as a whole.

This is seen by observers as part of a larger move to connect Xigaze with Nepal by

rail.

The local government of the Tibet Autonomous Region has said that the Gyirong Port

located in TAR's Xigaze Prefecture will begin operations in 2011 although some

portion of the construction work will continue even after it is opened to public.

The construction of the land port began in 2009 and the local government has now

given instructions to speed up the process.

The purpose is to make Gyirong, the "biggest land trade channel of TAR to South

Asia" over the next three to five years, the local government said.

The idea is to apparently build it as a border post larger than Nathula on the India-

China border and the existing border post connecting the Chinese town of Zhanmu

and the Nepali town of Dram.

There are five other minor points for overland trade on the China-Nepal border, which

are Kodari-Nyalam; Rasua-Kerung; Yari (Humla)-Purang; Olangchunggola-Riyo;

Kimathanka-Riwo, and Nechung (Mustang)-Legze.

Nepal has offered to import petroleum products from China is it is connected with

rail. "Our Government sincerely urges China to consider further extend and upgrade

the existing linkages up to the border of Nepal.

An expanded and enhanced connectivity between the two countries also open the

avenues for Nepal being a transit country between the two giant economies, China

and India," a Nepali government statement said.

http://timesofindia.indiatimes.com/world/china/China-building-biggest-land-port-to-

connect-with-South-Asia-via-Nepal/articleshow/6163712.cms

Amlekhgunj depot loss scales to record high

July 19: Amlekhgunj depot of Nepal Oil Corporation (NOC), which is infamous for

series of irregularities, has been once again marked as the highest loss-making depots

among operation in Nepal.

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A source at NOC has disclosed that the depot has recently reported a loss of 0.91

percent, which is not only higher than the acceptable limit set by the NOC itself but

even higher than last year´s loss, which attracted the constitutional anti-graft body to

launch a full-fledged investigation.

NOC sources said that the latest loss recorded by the depot is 0.34 percent points

higher than the acceptable limit of 0.57 percent in petrol storage.

"Loss recorded this time is far higher than what was found earlier in that depot.

However, no action has been taken against the officials for the irregularities so far,"

said the source, adding, "NOC management is trying to cover up the case with the

intention of protecting the culprits as in the past.‖

Currently, Bijaya Parbat is heading the Amlekhgunj depot, which is the largest depot

in term of transaction of petroleum products and the most lucrative for its employees

in terms of extra financial benefits.

Because of this, many believe that employees for major depots like the one in

Amlekhgunj are selected and deputed by the top officials of NOC under secret deal to

fulfill financial interests of the both parties.

NOC source said depots in Bhairahawa, Pokhara, Nepalgunj and Dhangadhi are

maintaining the loss within the limit set by NOC with the Bhairahawa depot reporting

the lowest volume of loss.

Bhairahawa depot recorded only half of the limit of the loss limit with the loss loss

rate of 0.26 percent, 0.20 percent and 0.15 percent in petrol, diesel and kerosene

respectively. NOC has fixed loss limit at 0.57 percent, 0.32 percent and 0.32 percent

for petrol, diesel and kerosene respectively for this depot.

NOC was compelled to suspend all employees of Amlekhgunj depot a few months

back after an investigation unearthed a huge corruption in the name of excessive

leakage beyond the acceptable limit.

Commission for the Investigation of Abuse of Authority (CIAA) -- the constitutional

anti-graft body -- is still investigating the corruption charges. An NOC investigation

had reckoned that the level of loss at that time was 0.80 percent, which inflicted a loss

of Rs 29 million to the stated-owned fuel monopolist.

Customers are compelled to pay the ever-growing price of petroleum products due to

mismanagement of NOC, which has been adjusting market price as per the

international prices.

Meanwhile, NOC has stated that depots reporting lowest rate of loss would be

awarded in an effort to discourage corruption in the depots in the name of loss in the

quantity of petroleum products.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21187

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Two four-star hotels coming up in the Valley

July 18: Two new four-star hotels are beginning operation in Kathmandu Valley right

on the eve of Nepal Tourism Year 2011.

Implementing Expert Group (IEG) - the investment group of businessmen and

professionals involved in international trade - is preparing for the grand opening of

the new hotels - Red Rose Apartment Hotel at Pulchowk and Airport Hotel near

Tribhuvan International Airport - in December.

The group is spending more than Rs 2 billion in the two projects. Binayak Shah,

active member of IEG and executive director of both the hotels, said the hotels would

focus on upmarket clientele and that they will not compromise on quality.

This is the biggest investment in Nepali hotel industry after the opening of Hotel

Hyatt Regency about a decade ago.

―We are introducing the best of the international hotel industry in Nepali hospitality

sector with opening of our hotels,‖ Shah told myrepublica.com. He added that they

group will organize soft opening of the both the hotels in 2010 and aggressively

promote them in both national and international markets in the beginning of 2011.

―The construction works have already been completed. We are just giving finishing

touches to the hotels,‖ he added.

Airport Hotel, which is located just in front the Golden Gate of Tribhuvan

International Airport, will have 55 rooms in five floors. The hotel will target people

traveling to and from Tribhuvan International Airport, according to Shah.

―Air passengers traveling to and from different parts of the world and those who have

missed flights can enjoy our hospitality with state of the art infrastructure and

services,‖ Shah added.

Airport Hotel is also the allied member of Hotel Association of Nepal.

Though the hotel will not have swimming pool, the promoters are hopeful of getting

four-star standard for the hotel. IEG has already spent Rs 600 million on the project

and the total investment is expected to touch Rs 750 million upon completion.

Similarly, the group has already invested Rs 400 million in Red Rose Apartment

Hotel, which will have 11 apartments and 30 rooms upon completion. People needing

accommodation for more than seven days are the targeted clients of this hotel,

according to Shah.

IEG is also planning to build shopping complexes and restaurants in both the

buildings.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21176

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MARKET:

NEPSE’s FY hits bad note

JUL 19 - Nepal Stock Exchange (NEPSE) began the new fiscal year on a dismal note

on Sunday.

The secondary market dropped 9.2 points when the market closed for the day. Except

for the hotel groups’ index; a fall in the indices of all other groups listed in NEPSE

led the secondary market to come down to 468.53 points.

According to stock experts, the secondary market, which had surged on the last

trading day of the last fiscal year, could not sustain the unexpected growth. They

attributed this to the fact that the upswing mode last Thursday was due to investors’

desire to see an increase in the NEPSE index to avoid margin calls from financing

banks. The market had witnessed a double digit growth of 10.4 points on Thursday.

N. K. Mundada, president of Nepal Stock Brokers’ Association, said investors’

tendency to sell their stocks as a reaction to Thursday’s upsurge exceeded the actual

demand, resulting in the tumble of the secondary market on Sunday.

Birendra Raj Kharel, chief of Pragyan Securitites, echoed Mundada’s words and ssaid

the market could have sustained the growth if Thursday’s growth was a ―real one.‖

The index of commercial banks’ group led the loser’s list, as it went down by 15.66

points. Hydropower groups and others witnessing a decline of 2.84 points and 2.35

points respectively followed the commercial banks’ group.

Similarly, groups including development banks and finance companies equally shed

0.94 point on Sunday. However, the hotels’ group did not see a change in its index.

Among the 54 companies on the trading floor, share prices of 12 companies went up

while those of eight companies remained constant.

The 34 companies pulled the secondary market to the red zone.

The stock market witnessed a transaction of Rs 13.19 million through trading of

43,042 shares in 580 transactions.

Unlike on Thursday, shares of Standard Chartered Bank suffered the most, losing Rs

326 per share, while Rastriya Beema Sansthan posted the highest gain with Rs 29 per

share.

http://www.ekantipur.com/2010/07/19/business/nepses-fy-hits-bad-note/318744/

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Gold price slips

JUL 18 - The price of gold declined by Rs 215 per 10 grams in the local market on

Sunday. The yellow metal was traded at Rs 30,090 that day against last week’s price

of Rs. 30,305 per 10 grams.

―The price of the yellow metal has gone down due to low demand in the international

market as the European economy has improved,‖ Tej Ratna Shakya, president of

Nepal Gold and Silver Dealers’ Association, told the Post. He said the demand for

gold in the local market has also gone down to an average of 15 kg per day as

compared to the demand for 20-30 kg per day last week.

The price of silver, however, remained stable at Rs. 480 per 10 grams.

Just two days ago, Nepal Rastra Bank had limited the quota system for interested

commercial banks to import gold to 10 kg per day from the earlier 20 kg.

―Though the demand is low compared to previous weeks, the current quota will not be

able to suffice the local demand,‖ said Shakya. He hoped that the government would

come up with a solution in this regard after bringing in the monitory policy.

http://www.ekantipur.com/the-kathmandu-post/2010/07/18/business/gold-price-

slips/210608/

POLITICS:

UML CC committee to discuss PM candidate on Monday

July 18: Ruling CPN-UML standing committee on Sunday begun discussion on new

government leadership just three days before the parliament votes to elect a new

prime minister.

The meeting decided to forward the matter to the central committee (CC), which

could finalize party´s candidate for the prime ministerial post. The CC meeting is

scheduled for Monday.

"At today´s meeting, we decided to forward the issue to the central committee,"

General Secretary, Ishwar Pokharel, told reporters after the meeting.

The party´s vice chairman Bamdev Gautam said they discussed making Chairman

Jhala Nath Khanal as party´s candidate for the post. "Everyone knows that party

chairman Khanal is the candidate from the UML. However, a formal decision wasn´t

taken today. We decided to discuss this at CC meeting," he said.

The parliament will vote for prime minister on July 21. The deadline to file candidacy

expires on July 20.

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Khanal and leaders close to him have intensified lobbying in and outside the party in

his favor while the party´s heavyweights Prime Minister Madhav Kumar Nepal and

KP Sharma Oli are reportedly not in favor of Khanal´s candidacy.

Oli held separate talks with Khanal and Nepal in the afternoon. He also held one-on-

one dialogue with Pokharel after the end of the standing committee meeting.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21183

10 parties to back Maoists

July 18: The alliance of 10 fringe political parties has decided to back the Maoists to

lead the new government saying that only the Maoists can institutionalize federalism,

secularism and republicanism.

―The demand for republicanism, secularism and federalism was raised by the Maoists

and it is extremely important to let the Maoists to lead the government for the

institutionalization of these issues,‖ leader of Nepa Party Keshabman Shakya said.

After the meeting, Maoist Vice-chairman Dr Baburam Bhattarai told media persons

that the fringe political parties asked the Maoists to lead the new government. All the

leaders of the 10-party alliance including those from CPN (United) and Sanghiya

Loktantrik Manch were present during the meeting.

The Maoists also held a meeting with the leaders of the Madhesi front. During the

meeting, Madhesi leaders argued that they would lend support to any party supporting

autonomous Madhes province, peace and constitution-drafting.

―We will support the party that addresses the issues of Madhes,‖ said Chairman of

Madhesi People´s Rights Forum (MPRF) Upendra Yadav.

After the meeting, Maoist Vice-chairman Narayankaji Shrestha said that his party´s

views are close to that of Madhesi parties. He said the Maoists would hold further

talks with the Madhes-based parties to garner support for a Maoist-led government.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21184

NC ups govt formation parleys

July 18: A day after the Nepali Congress chose the party´s Parliamentary Party

Leader Ram Chandra Poudel as its prime ministerial candidate, the party on Sunday

expedited talks with other political parties to court their support for government

formation.

While Poudel held separate parleys with influential CPN-UML leader KP Sharma Oli

and Chairman of Nepal Workers and Peasants Party (NWPP) Narayan Man Bijukchhe

in the morning, there were separate meetings of NC leaders with four Madhes-based

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parties -- Madhesi People´s Rights Forum-Democratic (MPRF-D), MPRF, Tarai

Madhes Democratic Party and Sadbhawana Party -- and Rastriya Prajatantra Party

(RPP) Chairman Pashupati SJB Rana later in the afternoon.

Talking to myrepublica.com, Oli said it was natural for the NC to seek support of

other parties as the party has already picked Poudel as its prime ministerial candidate.

He said he told Poudel that UML will support him after passing a decision through the

party´s Central Working Committee (CWC) meeting.

Bijukchhe told Poudel that NWPP would take a decision whether to support him or

not only after seeing plan and policies of the the proposed NC-led government. The

NWPP has five seats in parliament.

In a meeting held at the NC´s Parliamentary Party Office in Singha Durbar in the

afternoon, the four Madhesi political parties asked the NC to first clear its view on

three different issues related to peace process, constitution drafting and Madhes

agenda.

"The NC sought our support for a government under their leadership," Chairman of

Madhesi People´s Rights Forum (MPRF) Upendra Yadav told reporters after the

meeting.

"We asked them how they plan to ensure timely constitution writing, conclude peace

process and address the Madhesi agenda, which, among others, includes creation of

autonomous provinces," he said.

Almost all top leaders of the four Madhesi parties were present in the meeting that

lasted for more than an hour from 2.15 pm. Besides Yadav, TMDP Chief Mahantha

Thakur and SP chairman Rajendra Mahato were present in the talks. MPRF

(Democratic) Chairman Bijay Gachchhadar was represented by Rameshwar Raya

Yadav and Jitendra Dev.

MPRF Chief Yadav said the Madhesi parties would hold further talks among

themselves before announcing their support.

NC Spokesperson Arjun Narsingh KC told media persons that the talks were

"positive". He declined to divulge further details.

According to an NC leader present in the meeting, the Madhesi parties asked the NC

to first seek support of the UML as it plays a determining role in the formation of an

NC-led government. ―First garner support from the UML,‖ the leader quoted Madhesi

parties as saying. ―We will then talk to you about it.‖

With the Big Three -- UCPN (Maoist), the NC and CPN-UML -- still unable to forge

consensus and exploring all options for government formation under their leadership,

the support of the four Madhesi parties, which have revived their practically defunct

united front, could tilt the balance. Madhesi parties have 82 seats in parliament.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21174

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22 parties express their 'disagreement' on formation of SRC

18 July 2010 : Four Madhes-based and 18 fringe parties Sunday expressed their

serious disagreement over the recent decision of three major parties – Nepali

Congress, UML and UCPN (Maoist) – to form the State Reconstructing Commission

(SRC).

In a meeting of all 25 parties represented in the CA called by CA chairman Subash

Chandra Nemwang at the CA hall in New Baneshowr Sunday, the 22 parties made it

clear to the big three that they were not consulted when the SRC was formed, and

such a commission is against the sentiments of Madhesi people.

Chairman of MJF Upendra Yadav expressed that Madhesi people have objection to

the recent decision of three major parties to form seven-member State Restructuring

Commission (SRC) without consulting them.

There is no need for such a commission when Constituent Assembly is working for

state restructuring," Yadav expressed. He also criticised big three parties for taking

state restructuring task as their 'sole responsibility'. "We do have equal roles to play,"

he stated.

The smaller parties argued that the SRC is not necessary when there is the Committee

of State Reconstructing and Devolution of State Power as a legislature body.

Speaker of the CA, Subash Chandra Nemwang, summoned today's meet to inform

about the decision of forming the SRC and the new timeframe of statue writing,

before presenting it at CA session taking place Sunday afternoon after 3

pm.nepalnews.com

‘Govt sans us! Unthinkable...’

JUL 18 - Senior Vice Chairman of the UCPN (Maoist) Mohan Baidhya on Sunday

said the country would face a disaster if a majority government was formed by

bypassing his party.

Releasing the Hindi edition of the autobiography of jail-breaker Uma Bhujel in the

Capital, the Maoist second-in-command said a coalition formed without the largest

party in it would merely be a ―formal government‖ and would be unable to address

the challenges facing the country.

―The country won’t get a new constitution and the peace process will not reach a

logical conclusion if a majority government is formed,‖ he said, adding that the

mainstream parties, especially the Nepali Congress, were trying to corner the Maoists.

Reiterating that the Maoist party would never surrender, Baidhya said it would rather

struggle if there was no national unity government in place.

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He said the integration and rehabilitation of the Maoist fighters living in UN-

monitored camps cannot gain momentum without a unity government. Baidhya

claimed attempts were being made to besiege the Maoist party by

preventing the formation of a unity government, adding reluctance of non-Maoist

parties to give any powerful position to the single largest party was an indication.

http://www.ekantipur.com/the-kathmandu-post/2010/07/18/nation/govt-sans-us-

unthinkable.../210589/

CA calendar amended for 11th time

July 18: The Constituent Assembly (CA) amended its calendar of events for the

eleventh time on Sunday to continue the task of constitution drafting on schedule.

This is the first time that the CA calendar was amended after extension of the CA

term on May 28.

The amended calendar, prepared by the CA´s Business Advisory Committee (BAC)

and tabled by CA Chairman Subas Nembang, was approved by the CA´s full meeting.

As per the newly amended calendar, all reports of the thematic committees would be

transferred to the Constitution Committee (CC) for preparation of an integrated draft

of the constitution by October 16.

Similarly, the CC would begin its work to prepare the integrated draft of the

constitution from October 18 and complete its work within a month. Rest of the work

would be conducted as per the decision of the BAC.

The calendar plans to complete all works related to constitution-drafting by mid-April

2011.

After the proposal to amend the calendar was approved, CA Chairman Nembang

explained why the CA failed to draft the new constitution within two years.

According to him, the constitution-drafting and integration and rehabilitation of the

Maoist combatants are inter-related, but the integration process fell under the

jurisdiction of the executive and that posed hurdle to constitution-drafting.

Nembang also argued that the promulgation of the new constitution is the culmination

of the peace process, but the peace process itself did not move ahead, as expected, to

its logical conclusion.

Among other factors, Nembang argued, are the lack of consensus on the basic

principles of the constitution and serious differences among the political parties.

The CA chairman postponed the CA meeting until further notice.

Earlier in the morning, Nembang had called a meeting of 25 political parties to inform

them about the amendment.

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During the meeting, Madhesi parties had objected to the decision of the UCPN

(Maoist), Nepali Congress (NC) and CPN-UML to form State Restructuring

Commission (SRC) at this point of time. Consequently, the working schedule of SRC

was not inserted in the CA calendar due to the objection.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21164

GENERAL:

Foreign Secy upholds MRP tender to Oberthur

July 18: Foreign Secretary Madan Kumar Bhattarai on Sunday upheld his ministry´s

previous decision to award the tender for printing machine readable passports (MRPs)

to France-based Oberthur Technologies.

Taking up two separate pleas filed by Indonesian Perum Peruri and British De La Rue

to review the earlier decision, Bhattarai took the decision after the ministry could not

verify the charge against the French security printer through diplomatic channels.

The Indonesian and British security printers had filed the complaints against the July

7 decision under the Public Procurement Act, accusing the French security printer of

furnishing fake user certificate of personalized printer from PARK and OPC.

They had alleged that the PARK and OPC personalized printers were not used in

Korea and Ghana, something contrary to the claim of Oberthur.

―We inquired to find out the authenticity of the issues raised in the complaints through

our embassies in Seoul and New Delhi. We also contacted Korean Embassy and

Japanese Embassy. But no one has replied to us to date,‖ said Mukti Nath Bhatta, the

chief of protocol.

The ministry had contacted Korean government, government of Ghana and Libya

through its missions in Seoul and Delhi to find out fact.

―As we could not get information for and against the previous decision, there is no

need to cancel it (to award the tender to Oberthur),‖ Bhatta added.

The ministry had selected Oberthur among four bidders after it found the offer of the

French printer most competitive. It has offered to supply per MRP at US$ 3.59.

According to Bhatta, the Indonesian and British security printers can lodge complaint

against the ministry´s decision at the Office of the Public Procurement Monitoring.

The MRP tender has already landed in the Public Accounts Committee of parliament.

The ministry on Sunday sent all the documents related to the tender to the committee

for investigation.

http://www.myrepublica.com/portal/index.php?action=news_details&news_id=21167

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Govt set to amend Industrial Enterprises Act

18 July 2010 : The government has initiated process to amend the Industrial

Enterprises Act, 2049 for the second time.

The amendment process has been taken ahead in line with the Industrial Act, 2067.

The ministry of industry has formed a task force to chalk out a draft of the

amendment. The task force constitutes members representing ministries pertaining to

industry, law, labour, finance, commerce and supply.

The task force is planning to accomplish the amendment process within three months

for fiscal year (FY) 2067/68.

The industry ministry is also consulting with concerned stakeholders to incorporate

their suggestions in the draft paper.

The Industrial Enterprises Act, 2049 saw the first amendment in 2054 B.S.

The draft paper incorporates special policy level arrangements related to 'no work, no

pay’, industrial security force, special economic zone, export increment, mobilisation

of local resources, protection of intellectual property and additional privileges and

facilities for small and cottage industries, among others. nepalnews.com

Manakamana Cable Car records highest number of passengers

18 July 2010 : Manakamana Cable Car recorded the highest number of passengers -

over 800,000 - during the current fiscal year, Karobar daily reported.

According to Manakamana Darshan Pvt. Ltd, the number of passengers has increased

by around 200,000 this current fiscal year compared to last year. It has also collected

around Rs. 250 million from the operations of the cable car.

―Both national and international visitors have increased this year‖, said Sunil

Karmacharya, in charge of the cable car operation. Of the total visitors, 60 percent

were Nepalese while 40 percent were international, he added.

679,185 passengers used the cable car during the fiscal year 2065/66 while the

number has increased to 835,000 passengers in this current fiscal year. The number of

passenger was recorded at 592,605 in the fiscal year 2064/65.

Karmacharya also said that the numbers has increased to stand at about 2,500

passengers a day which used to be about 2,000 passengers daily.

During the mid-July to mid-August period, there are many visitors from India to

Pashupatinath whom also visit the Manakamana temple on the same trip, and this has

contributed to increase the cable car passengers, he added.

Manakamana Cable Car has ferried 5,800,000 passengers till date since the beginning

of its operations. nepalnews.com

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Sunsari embankment on Koshi target

JUL 19 - Koshi River has begun breaching an embankment at Pulthegauda of Sunsari

district, putting human settlements nearby at flood risk.

Rising water in the river has devoured a large section of the eastern embankment, said

officials of Water Induced Disaster Control Office in Biratnagar. Efforts to control the

swollen river have failed.

Engineer Mohan Bhattarai said the embankment may burst anytime and devastation

would be unprecedented if immediate steps are not taken. Continious rainfall also

has affected repair work at the embankment.

Experts had recommended repair and maintenance of the Pulthegauda section of the

eastern embankment before the monsoon, but things failed to take off due to lack of

budget.

Sunday afternoon’s reading showed that the water flow rate in the Koshi Barrage was

132,000 cu.sec. A week earlier, the measurement had showed this year’s highest at

175,000 cu.sec.

Chief District Officer of Sunsari Ram Prasad Thapaliya said a team led by his deputy

was at Pulthegauda to take stock of the situation.

http://www.ekantipur.com/2010/07/19/national/sunsari-embankment-on-koshi-

target/318756/