Kathmandu: In response to the persisting economic challenges, the government is actively exploring measures to rectify the ongoing economic crisis, which has yet to regain momentum despite various reformative endeavors.

Prime Minister Pushpa Kamal Dahal 'Prachanda' convened discussions with representatives from diverse ministries, including the National Planning Commission, Nepal Rastra Bank, and other stakeholders, to assess the current state of the country's economy and explore strategies to address the crisis.

In a meeting of ruling Nepali Congress office-bearers held on the same day, Finance Minister Dr. Prakash Sharan Mahat presented a briefing on the economic situation of the country. Participants emphasized the need for immediate steps to revitalize the national economy, with particular attention to post-quake relief and reconstruction efforts in Jajarkot and Rukum Paschim.

Several factors contribute to the existing economic challenges, including the lax implementation of government policies, programs, and budgets, along with low capital expenditure. Reduced credit flow, high-interest rates, diminished consumer demand, declining morale in the private sector, and the failure to boost domestic productivity are among the issues plaguing the economy.

The Federation of Nepalese Chambers of Commerce and Industry (FNCCI), representing the private sector, has been vocal about the need for prompt government initiatives to address the country's economic problems. Following the FNCCI's 'National Economic Talks' on October 12, Prime Minister Dahal expressed the possibility of forming a high-level mechanism for economic reforms.

Despite the government's initiation of policy and procedural reforms in the current fiscal year's budget, there is a perceived lack of robust implementation. The government aims to host an international investment summit in the third week of April 2024, pending cabinet approval.

The current economic indicators highlight challenges, with government expenditure at only 20% of the annual target in the first quarter of the fiscal year. Revenue collection is also notably below target, standing at 20.08% of the annual goal. Inflation has surpassed the government's 6.5% target, reaching 7.5% in the first quarter. Meanwhile, bank and financial institutions face challenges in expanding their loan portfolios.

The external sector, however, shows improvement, with a 30% growth in remittance inflow and a surplus of Rs 99.7 billion in the balance of payments. Import increased by 1.7%, while exports decreased by 2.3% in the first quarter.

In response to the economic situation, the government, in a meeting at the Prime Minister's residence Baluwatar, decided to collect feedback and suggestions from the private sector. Finance Minister Dr. Mahat stated that the discussion would take place at the Prime Minister's Office in Singh Durbar on Tuesday, seeking private sector input on revitalizing the country's economy.