5 days ago
Nepal Says Balen Shah’s First Foreign Visit Will Be India
Nepal’s finance minister said Prime Minister Balen Shah plans to make India his first foreign visit.
The trip is hoped to happen before the end of the year, but no date has been chosen.
Shah spent his first months in office working on a domestic 100-point plan.
Nepal’s government wants to attract more investment and improve its rules for businesses.
It identified clean energy, tourism, manufacturing, agriculture, and digital services as important areas for growth.
Nepal also uses a fixed exchange rate between its rupee and India’s rupee.
The finance minister said Nepal will study whether that arrangement should change someday, but not immediately.
He said Nepal depends heavily on India, with about 70 percent of its trade involving India.
The government also aims to grow Nepal’s economy to $100 billion within five to seven years.
Nepal Finance Minister Swarnim Wagle said Prime Minister Balendra Shah’s first foreign visit is expected to be to India before the end of the year.
Wagle said the government rated its performance during Shah’s first 100 days at 87.2 percent.
Nepal plans reforms covering contracts, private property, and equal treatment for domestic, diaspora, and foreign investors.
Wagle said Nepal will study its currency peg to the Indian rupee but does not currently plan to change it.
The government is targeting a $100-billion economy within five to seven years, requiring growth of at least 7 percent.
- Who
- Nepal Prime Minister Balendra ‘Balen’ Shah and Finance Minister Swarnim Wagle; Indian BJP MP Ravi Shankar Prasad also commented.
- What
- Wagle announced that Shah’s first foreign visit is expected to be to India and discussed Nepal’s economic plans and currency peg.
- Where
- The announcement was made at NDTV’s Anviksha summit in Kathmandu, Nepal; the planned destination is India.
- When
- The announcement was made on Thursday; the visit is hoped to occur before the end of the year.
- Why
- No specific purpose for the visit was stated, although the strength and importance of Nepal-India relations were emphasized.
Review the currency peg
Keep the peg for now
Timing of a possible change
Review the currency peg
Shashi Tharoor questioned whether Nepal might be better off without the peg, citing Sri Lanka’s unpegged currency.
Keep the peg for now
Wagle said the manifesto promised only a study, not a change, and argued that Nepal’s current conditions are not suitable for devaluation or an immediate adjustment.
Long-term currency policy
Review the currency peg
Wagle acknowledged that Nepal’s productivity gap with India has widened and said the arrangement could be reconsidered over a five-, 10-, or 15-year horizon.
Keep the peg for now
Wagle also described the peg as a stable nominal anchor and said Nepal remains too dependent on India to change it easily.
Key facts
- Prime minister
- Balendra ‘Balen’ Shah, sworn in on March 27 according to the article
- Expected first visit
- India, with dates still being arranged
- Government performance rating
- 87.2 percent for the first 100 days
- Currency peg
- The Nepali rupee is pegged to the Indian rupee at 1.6 to 1
- Trade dependence
- Wagle said 70 percent of Nepal’s trade is with India
- Economic target
- A $100-billion economy in five to seven years, requiring at least 7 percent growth
- Growth sectors
- Clean energy, tourism, border manufacturing, high-value agriculture, and digitalisation
Quotes
Balendra 'Balen' Shah
Nepal's prime minister
“The whole foundation of Nepal-India relations is so strong. You cannot segregate them through passports or through geographical boundaries... And if today [Wagle] has firmly stated that the first visit of the honourable Prime Minister Balen Shah will be to India, that shows the way as to what is going to be the relationship - that's quite remarkable.”
NDTV
“I am pretty confident that his first visit abroad will be to India, and the dates will need to be worked out, but I am very hopeful that this will happen before the end of the year.”
NDTV
Sources
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