Kathmandu. The Finance Committee has discussed the bill designed to amend the Nepal Rastra Bank Act, 2058.
On the occasion, Finance Minister Dr Swarnim Wagle said extensive consultations were held with experts and stakeholders in course of formulating monetary policy.
According to him, the NRB’s research department presents evidence and facts on the state of the monetary and overall economy while formulating the monetary policy, and in consultation with the experts and stakeholders including the chief executive officer of the banks and financial sector.
He said that although such a process of monetary policy making can be mentioned in the Act itself, it should not be understood in a way that affects the complete independence of the NRB.
“It does not mean that the concerned body will have a say in the formulation of the monetary policy,” he said, “Therefore, this issue can be addressed in the Act to some extent.” ’
Minister Wagle said although it is not a big change issue to legally incorporate experts’ advice in monetary policy formulation, there would be no problem in incorporating it.
According to him, the governor and deputy governors of the Nepal Rastra Bank are in the board of directors, so they are directly involved in the monetary policy-making process.
He said that there is also a practice of taking opinion of experts related to loan, exchange rate and balance of payment as per the need.
Minister Wagle said that along with the Nepal Rastra Bank, the International Monetary Fund (IMF) will also play an important role in the formulation of monetary policy. He said that the monetary and economic situation of Nepal will be discussed regularly in the process of Article Four consultation with the IMF.
He also said that attention should be paid to include external and independent experts in the board of directors of the NRB. He said that while determining the structure of the board of directors, a person with expertise and experience in monetary economics and who can take the NRB forward in a new direction can be selected.
“The structure of the Board of Directors can be improved by looking at the expertise and experience of external experts,” Minister Wagle said, “A space can be created to accommodate people with real expertise and experience in the monetary sector.” ’
