Economic rehabilitation fund to be established

Kathmandu December 16- As promised in the current fiscal year budget and recently introduced White Paper on economy, the government is working to set up a multi-billion economic rehabilitation fund, aiming to help enterprises hit hard by the April 25 earthquake, Tarai unrest and Indian blockade.

 Senior officials at the Finance Ministry, however, said the size of the fund and kind of facilities to be provided are still being discussed. Although Nepal Rastra Bank (NRB) has proposed Rs 100 billion for refinancing, officials at the Ministry of Finance have been tight-lipped about the fund size.

With revenue collection expected to decline by Rs 50 billion by mid-December, the government is in touch with donors for injecting resource into the proposed fund.

The NRB has insisted on giving priority to refinancing instead of interest subsidy since the government is struggling to collect revenue however, the business community has sought 50 percent exemption of interest on loans.