Nepal-India financial integration is crucial due to largest trading partner: Finance Minister Mahat

By Ajay Chhetri, Kathmandu, Dec 22: Minister for Finance (MoF) Dr Prakash Sharan Mahat has said that financial integration among the countries at the regional level is crucial.

While speaking at Nepal BFSI Summit 2023, at Kathmandu, Dr Mahat said that cooperation between India and Nepal is specifically vital as India is the largest trading partner of Nepal.

Similarly, Nepal has been enhancing trade relations with Bangladesh.

He further added that the integration of capital and financial markets of India, Nepal, Sri Lanka, Bangladesh, Malaysia should be enhanced. 

MoF Mahat informed that Nepal will host an investment summit in April with the main motive of encouraging investment in Nepal.

Addressing the summit, Governor of Nepal Rastra Bank (NRB) Maha Prasad Adhikari, informed that NRB is moving forward for the introduction of central bank digital currency targeting 2026.

Governer Adhikari said that the recent agreement between NPCI International Payments Limited (NIPL) and Nepal Clearing House Limited (NCHL) for the collaboration of the Unified Payments Interface(UPI)of India and National Payments Interface (NPI) of Nepal has been a crucial step transaction settlement of cross-border transaction between Nepal and India.

He emphatically pointed out that to enhance regional collaboration in the financial sector, it is essential to develop and substantiate a common framework among financial sector regulators in the first place and develop a mechanism of information sharing among regulatory bodies and financial institutions across the region to deal collectively with emerging risk and challenges.

In this summit, the ambassador of India to Nepal Naveen Srivastava said that NPCI and NCHL payment systems are likely to start operating from February next year allowing cross-border payment in an instant basis.

He said that our focus should be on making cross-border financial services simpler for ordinary citizens. 

He also said that if we move forward for making digital ID between on India and Nepal operable it will help smoothening the movement of people, boost payment services, seamless transaction of trade and business.

The other key speakers were former Ambassador of India to Nepal Mr Manjeev Singh Puri, India's Former Ambassador to Nepal & Chair, India-Nepal Centre; Dr Binod Atreya, Managing Director, BFIN; Dr Ranjeet Mehta, Executive Director, PHDCCI; Dr Atiur Rahman, Former Governor, Central Bank of Bangladesh, Mr Atul K Thakur, Secretary, India-Nepal Centre, PHDCCI; Mr Rajesh Agrawal, President, Confederation of Nepalese Industries (CNI); Mr Rajendra Malla, President, Nepal Chamber of Commerce (NCC); Mr Anil Kumar Agrawal, President, Birgunj Chamber of Commerce & Industries (BICCI).

The Banking, Finance and Insurance Institute of Nepal (BFIN) and “India-Nepal Centre” of PHD Chamber of Commerce and Industry (PHDCCI) Summit was organized to share the best practices in banking innovations and collaboration in the financial sector for strengthening economic relations between two countries (India and Nepal) besides exploring the emerging regional and subregional collaboration opportunities.