Biz News March 2015

  21 min 4 sec to read

New Hotels in Biratnagar, Dolakha
Lately, new hotels are coming up in the city of Biratnagar. One of such hotels is a four-star hotel being constructed by entrepreneur Punya Bhattarai who has invested Rs 200 million in the project. The six-story hotel which is located at the Airport Mod is in the final stage of construction and is expected to come into operation by April this year. The hotel which has been named Hotel Purvanchal Pvt Ltd will have one VIP room, seven suiets, 32 deluxe rooms and remaining standard rooms. 
The hotel will have a banquet hall with accommodation capacity of 1,000 persons and a restaurant and bar to accommodate 100 persons. The hotel will have separate kitchens for vegetarian and non-vegetarian customers. The hotel will also have as swimming pool. 
Thirty new hotels have opened up in Biratnagar area over the last three years. More than Rs 500 million has been spent in the renovation of the existing hotels in the area. Hotel Panchali which has an investment of Rs 50 million came into operation only a couple of months ago.
Similarly, a new hotel named Hotel Kuber with an investment of Rs 150 million has come into operation at Charikot, the headquarters of Dolakha district. Owner of the six-story hotel, Kuber Thapa claimed that it is the best hotel in the district in terms of facilities and services. The hotel will have 30 rooms including suiets, deluxe, luxury and general rooms, according to Nawaraj Khatiwada, manager of the hotel. These rooms are priced at Rs 2,500, Rs 2,000, Rs 1,500 and Rs 1,200, respectively. 
Khatiwada added that the hotel will have a bar with accommodation capacity of 50 persons, a programme hall with accommodation capacity of 70 persons and a party palace with accommodation capacity of 500 persons.
Mai Hydropower Connected to National Grid
The electricity generated by the 22MW Mai Hydropower Project (MHP) was connected to the national grid on February 3 through a 33kva temporary transmission line, according to Dr Subarna Das Shrestha, chief executive officer of the project. Currently, the project generates only 6MW of hydroelectricity. “Since it is a run-of-the-river project, it will generate 6 MW only in the dry season. However, it will generate electricity to its full capacity in the wet season,” said Shrestha.
The construction cost of the project is around Rs 3.10 billion. Non-Resident Nepalis Dr Upendra Mahato, Jiba Lamichhane and Arun Ojha have invested in the project. The project hadn’t been able to start commercial production because the Jaguar Aster Joint Venture Company, India which was selected by Nepal Electricity Authority (NEA) to construct the Kabeli Corridor Transmission Line delayed the construction of the transmission line.
Similarly, preparations are being made to connect the electricity generated by Aandhikhola Hydroelectricity Project to the national grid. According to Vishnu Bahadur Singh, chief of the project, the capacity of the project has been increased to 9.4MW and test-runs are underway. Butwal Power Company is the promoter of the project. The power generated by the project will be connected to NEA’s Rangkhola substation at Syangja through a 30-kilometre 33kva transmission line con-structed by the company itself. The project has used, for the first time in Nepal, a rubber dam.
Lords Hotel & Resorts Increases Investment in Nepal
Lords Hotel & Resorts, an Indian chain of hotels, is poised to run a second hotel in Nepal. It is learnt that the hotel chain will upgrade the Hilltake Health Spa and Resort (HHSR) at Bhaktapur’s Sanga into a modern resort, rebranding it as Hilltake Lords Resort, according to Sumit Goyal, manager of the resort which boasts of the tallest Shiva statue (143 feet) in the world.
“Lords is carrying out a study regarding running the resort,” he said, “Most probably, the resort will be given a new look, with change in its interior design.”
HHSR is mainly famous among religious tourists. But lately, the number of vacationers, too, has increased. It is learnt that Lords has decided to run a modern resort at Sanga as the Shiva temple there is quite popular among the Indian tourists as well. The hotel chain already runs a hotel named Mirage Lords Inn at Battisputali of Kathmandu. This is the only hotel run by Lords outside India so far.
It is learnt that Rishi Puri, vice-president of Lords Hotel & Resorts, and industrialist and builder of the Shiva statue, Kamal Jain have already reached an agreement to run a resort on the temple premises. According to Goyal, discussions are underway to decide the new investment to be made by Lords in the 38-room HHSR. “Several things are still in the study phase,” he said, “Lords will upgrade the resort as per their standards.”
According to Indian media, Lords has planned to add more than 50 rooms to the current resort. It has been said that the new upgraded resort will have facilities and services such as cottages, swimming pool, health club and spa, restaurant, bar, banquet hall and outdoor Jacuzzi.
ADB President’s 8-Point Formula for Nepal’s Development
Asian Development Bank (ADB) President Takehiko Nakao who paid a three-day visit to Nepal in the first week of February has suggested to the government an eight-point formula for the country’s rapid development. Nakao’s suggestions have come at a time when Nepal has not been able to make effective plans to meet the target of graduating from LDC status to the status of a developing country over the next eight years.
During an interaction with journalist on February 3, Nakao said that Nepal should increase investment in education and health sectors for long-term development. He added that this would make the general public capable, skilled and committed to development. He also said that Nepalis of all classes and regions should feel equally treated by the state.
According to Nakao, overall economic stability, investment climate and guarantee of security are the fundamental elements for increasing domestic as well as foreign investment in the country. “However, other formulas won’t work if there is no good governance, “ he said, “Therefore, the government should take strong initiatives to eradicate corruption.”
Nakao also emphasized on public-private partnership (PPP) for the development of hydropower sector, which, according to him, has the highest potential among all sectors. “The private sector should be encouraged as much as possible to investment in hydropower. For this, the PPP model can be used,” said Nakao.
Telecoms Invested Rs 22 Billion in Previous Fiscal
The telecommunications companies operating in the country made an investment of Rs 22 billion to expand services and build infrastructure in fiscal year 2013/14, thanks to the growing number of customers and increasing demand for data services. As per the unaudited annual reports of last fiscal year submitted by various telecommunication companies to Nepal Telecommunication Authority (NTA), Nepal Telecom (NT) leads the list. The state-owned company made a profit of more than Rs 39.26 billion and invested more than Rs 14.43 billion in 2013/14. Ncell is at number two, investing Rs 7.84 billion. However, its profit is higher than that of NT – Rs 48.47 billion.
Similarly, Smart Telecom made an investment of Rs 80.7 million and a profit of Rs 940.69 million in FY 2013/14. It has made a profit of Rs 946.9 million in the period. However, according to the statistic provided by companies such as United Telecom Limited (UTL), STM Telecom and Nepal Satellite Telecom, they have not made any new investment in FY 2013/14.
NT, Ncell, Smart Telecom, UTL, STM Telecom and Nepal Satellite have deposited Rs 682.2 million, Rs 775.2 million, Rs 12.6 million, Rs 10.9 million, Rs 3.36 million and Rs 3.1 million in the Rural Telecommunication Development Fund (RTDF). The Telecommunications Act 1997 requires companies receiving license from NTA to deposit two percent of their annual profits in the RTDF.
Bangladesh Ready to Sign AADT with Nepal
Bangladesh has expressed readiness to sign the Agreement for the Avoidance of Double Taxation (AADT) with Nepal. Nepal had proposed to Bangladesh to ink AADT way back in 1998. However, the agreement couldn’t materialize as Bangladesh didn’t agree, among other issues, to provide tax concessions to Nepali students studying there. According to officials at the Inland Revenue Department (IRD), the two countries agreed on January 29 to sign the AADT in the next two months. “After two months, the finance ministers of the two countries will sign the agreement,” said Chudamani Sharma, director general of IRD. Nepal has already signed AADT with 10 countries. Once the AADT is signed with Bangladesh, the Nepali students studying there would benefit. Bangladesh has been investing in Nepal’s civil aviation, hydropower and banking sectors.
Clinker Import up, Cement Export to Start
The import of steel and clinker, two crucial construction materials, through Birgunj has sharply increased in the first six months (mid-July 2014 to mid-January 2015) of the current fiscal year, compared to the same period of the previous fiscal year. Government statistics show that 113,018 metric ton of mild steel billets (MS billets) worth Rs 6.069 billion was imported during the first half of the current fiscal year. In the same period of the previous fiscal year, 63,363 tons of MS billets worth Rs 3.13 billion were imported.
Similarly, 233,972 metric ton of clinker has been imported in the first half of the current fiscal year. The import of clinker in the first half of the previous fiscal year stood at 184,030 tons.
There are nearly two dozen construction material manufacturing industries in the Bara-Parsa corridor that import their raw material through Birgunj. Most of the steel imported has come through the Birgunj Dry Port while clinker has entered thr country through the Birgunj Customs Office. No clinker is imported through the Dry Port.
Meanwhile, a Nepali cement company is planning to export its product to India. Satish Chachan, managing director of Narayani Cement Udyog Pvt Ltd located at Lipanimal of Bara district says the company is planning to export cement to India. “The process to receive the BIS (Bureau of Indian Standards) Certificate is in the final stage in order for us to be able to export cement to India,” he said while speaking at a Dealers’ Meet organized on the industry premises a month ago.
Narayani Cement Udyog, which is owned by the Chachan Group, produces Trishakti brand of cements. The factory has been producing 1,050 metric ton of cement a day. Chachan also unveiled a plan to run another cement factory named Jaybageshwari Cements Pvt Ltd at Ganapur of Nepalgunj.
Subisu CAN InfoTech 2015 Concluded
The Subisu CAN InfoTech 2015 was successfully concluded in the capital. According to the Computer Association of Nepal (CAN) Federation, organizer of the event, the event was successful in disseminating information about the latest technologies and products in the information, communication and technology (ICT) sector to the visitors.
This was the 21st edition of the annual event and received 331,000 visitors. On February 2, the last day of the event, some 39,500 persons visited the event. There were nearly 200 stalls showcasing various ICT products and services in the event.
Similarly, the ICT summit 2015, organized by CAN Federation, also concluded successfully in the capital on February 1-2.
Nepal Participates in 2nd JWG Meetings
Nepal has participated in the second meetings of the Joint Working Groups (JWGs) held in New Delhi on January 30-31. The meetings were focused on sub-regional cooperation among Bangladesh, Bhutan, India and Nepal (BBIN) on water resources management, power/hydropower and on connectivity and transit facilities. Nepal hadn’t participated in the first meetings of the Group initially formed by India, Bangladesh and Bhutan.
According to Madhu Kumar Bhetwal, deputy executive director at the Department of Electricity Development, members of the Group discussed, electricity transmission network, energy trade, railway network, road network and transit issues among themselves during the meetings.
“As Nepal participated in the meetings for the first time, we decided to listen and understand the issues more than putting forward our views,” said Bhetwal.
The Bangladesh delegation was led by Mr. Tareq Md. Ariful Islam, Director General (South Asia), Ministry of Foreign Affairs; the Bhutanese delegation by Dasho Yeshi Wangdi, Director General, Department of Hydropower and Power Systems, Ministry of Economic Affairs; the Nepali delegation by Mr. Prakash Kumar Suvedi, Joint Secretary (South Asia), Ministry of Foreign Affairs; and the Indian delegation respectively by Mr. Abhay Thakur, Joint Secretary (North) and Ms. Sripriya Ranganathan, Joint Secretary (BM), Ministry of External Affairs, according to a press statement by India’s Ministry of External Affairs.
The next JWG meetings will be held in Bangladesh some time after mid-2015.
Two Companies Selected for KVISWM Project DPR
The Investment Board Nepal (IBN) has issued work order to two joint venture companies on February 11 to prepares a detailed project report (DPR) of the Kathmandu Valley Integrated Solid Waste Management (KVISWM) project. The IBN move has set the KVISWM Project in motion. 
According to the monthly newsletter of IBN (Feb-March 2015 isue), the work orders were handed to the two selected bidders- Nepwaste Pvt Ltd (Joint Venture of Communication OY and The Organic Village) and Clean Valley Company Pvt Ltd (Joint Venture of BVG, Greenfield Waste Management and KRYSS International). 
Nepwaste will prepare the DPR of Kathmandu Metropolitan City and surrounding Village Development Committees (VDCs) under Package 1 of the project, while Clean Valley will prepare the DPR of Lalitpur Sub-metropolitan City, Kirtipur Municipality and adjoining VDCs under Package 2 and DPR of Bhaktapur Municipality, Madhyapur Thimi Municipality and nearby VDCs Package 3, the newsletter says. IBN CEO Radhesh Pant termed the hand-over of work orders a significant step forward in the process of resolving the long-standing problem of solid waste management in the capital valley.
Sumitra Amatya, Executive Director of the Solid Waste Management Technical Support Center, Ministry of Urban Devel¬opment, said conflicts with the locals of the landfill site and environment related problems will be reduced once the project gets implemented. The selected companies have to complete the DPRs within six to 11 months from the date of issuance of the work order.
Trader Mali Passes Away
Petroleum trader and singer Hikmat Bahadur Mali passed away on Friday 20th at the age of 61. Mali who was suffering from cancer took his last breathe on Friday morning at Om Hospital, Chabahil where he was admitted for the treatment of the disease. The cancer which started from his arm in 2012 had spread to his lungs. 
The notable trader was known for his involvement in various petroleum related trading activities. Mali, who was the owner of Mali Oil Store at Kalimati, is credited for commercializing the engine oil and lubricants business in Nepal. His firm is the authorised distributor for BP engine oils and lubricants in Nepal. Mali was also known for his vocal talents. The song 'kun desh ki chari hau timi…' was quite popular in 1980s'. Similarly, he also lent his voice to about a dozen Newari songs. He was also involved in various social activities.  
NCC Fusion Fest 2015 Concludes
NCC Fusion Fest 2015 organized by Nepal Commerce Campus concluded on 2nd February. The event was organized by students of Masters of Business Management faculty (MBM) faculty the Campus. The Fest was a part of Golden Jubilee Celebration of the Campus, and also was the concluding event. Director of the Campus Bihari Binod Pokhrel informed that the event was organized to assist the students in the practical application of the acquired knowledge.  He also said that the fest also helped in popularizing the relatively new MBM degree. The Fest had events like cultural program, bold donation and health camp, band competition, DJ session and food festival among others.  Cobweb and other local bands and musicians gave their performances in the Fest.
Mid-Term Budget Review - Govt's Development Assistance Evpenditure Very Low
The government’s ability to spend the assistance provided by Nepal’s development partners is very low, as shown by the mid-term review of the budget for the current fiscal year. The review shows that the government has been able to spend only 8.41 per cent of the grants and 4.9 per cent of the loans received from donors in the first half of FY 2014/15.
It is noteworthy that foreign assistance commitment to Nepal has increased four folds to about Rs 217 billion in the first half of the current fiscal year, from Rs 55.29 billion in the same period of the last fiscal year. The government had set the targets of spending more than Rs 73.38 billion of foreign grants and Rs 49.52 billion of foreign loans in the current fiscal year. 
In the mid-term budget review programme organized at the Ministry of Finance on February 23, Finance Minister Dr Ram Sharan Mahat accepted the government’s inability to mobilize foreign assistance. “The foreign assistance spending is seen low also because the direct payments to projects and expenditure of grants are not included in the statistics mentioned in the review,” explained Dr Mahat. He also said that the government would adopt the policy of encouraging monetary assistance and discouraging non-monetary assistance.
Though the finance ministry has been urging other ministries and government  line agencies to increase expenditure, the review shows that the government was able to spend only Rs 161.84 billion or 26.20 percent of the total budget of Rs 618.10 billion.   
The government’s capital expenditure in the review period, too, has not been impressive, though the first half of the current fiscal year witnessed a 28.3 per cent increase in capital expenditure, compared to the same period of the previous fiscal year. In the first six months of the last fiscal year, the government was able to spend only 13.46 per cent of  the total capital expenditure of Rs 85.10 billion.
However, the government has exceeded its revenue mobilization target of Rs 185.48 billion by more than Rs 5 billion in the review period. The government has also projected that the GDP growth rate will be limited to five per cent this fiscal year. Dr Mahat blamed this on low cereal harvest owing to unfavourable climatic conditions. The government had targeted to achieve a growth rate of six percent this fiscal year.
Similarly, the review has projected the inflation rate to be limited to 7.3 per cent for the current fiscal year, compared to 9.1 percent in the previous fiscal year.  
Gionee Electronics Expo 2015 Concludes
Gionee Electronics Expo 2015 organized in Bhaktapur has concluded doing a business of 80 million rupees. The five-day Expo was organized by Bhaktapur Electronics Entrepreneur Organization. “We expected a business of around 30 million rupees, but the transactions surpassed our expectations. We are very excited about this,” said Expo Coordinator Nhuchhe Ratna Manandhar. He informed that the Expo was held with an intention to develop Bhaktapur as a hub for electronics, and also to promote culture and tourism.   According to the organizers, the Expo saw 85,000 footfalls. There were more than 100 stalls of electronic goods, IT, mobiles, and other commodities produced in Bhaktapur district. There were stalls offering traditional delicacies like bara, samayabaji, chhoila and others. There were other attractions like motorbike stunt show, cultural and musical programs, and Children Park. 
Now Nepal Can Use Visakhapatanam Port, Rohanpur-Singhbad Rail Route for Trade and Transit
Nepal will now be able to use India’s Visakhapatnam Port, which also receives mother vessels, for international trade and the Rohanpur-Singhbad railway transit point between Bangladesh and India for trade with Bangladesh. This has been possible as India has agreed to five Letters of Exchange (LOEs) forwarded by Nepal.  These LOEs had been waiting for India’s approval for the past five years.
Nepal had forwarded six transit and trade related LOEs to India following the Nepal-India Joint Commission in August last year. India has agreed to five of those LOEs and sent them back to Nepal with some suggestions, according to a highly-placed official at the Ministry of Commerce and Supplies.
“Preparations are being made to finalise the LOEs by including India’s suggestions and forward them to the Cabinet for approval,” said the official.
As Nepali authorities could not agree on certain provisions of the draft LOEs, the documents were stuck at the Ministry of Foreign Affairs for five years.
Nepal is currently using one Indian port, the Kolkata Port, for its third country trade. Once Nepal starts using the Visakhapatnam port, transportation cost as well as risks of its international trade will come down, according to Nepali traders.
The LoEs agreed upon by India are for the  operationalization of rail transit through Singhbad to Rohanpur, simplification in modality for traffic movement between Nepal and Bangladesh through Kakarvitta to Banglabandha, amendment to treaty of transit for the movement of traffic from/to Visakhapatnam Port to Nepal (by road/by rail), and LOE for railway service agreement.
India has, however, said that it needs to further study the LOE for traffic in transit via Nepal to India. 
The LOEs agreed upon by India will play a crucial role in enhancing Nepal’s international trade, according to Rajan Sharma, president of Nepal freight Forwarder’s Association. “These LOEs have opened doors for new possibilities of trade with third countries,” he said. Launched Officially, a social networking website designed and developed by a Nepali is launched on 25th February 1015. The website was made public in Nepal, India and in USA at once. According to the company, the social networking website is different from other popular ones like Facebook and Twitter as at offers financial rewards to its users. Rewards are offered upon signing up for the website, messaging, making friends and other actions. The website is developed by Sagoon Inc, a company owned by Govinda Giri, a Nepali residing in USA. Giri has worked as System Engineer in the Pentagon in the past. 
Users who first sign up will get a USD 5 reward which can be redeemed at the website’s listed vendors. The website features Social Smart Card and Me (professional and personal information) page. According to the company, the Social Smart Card in the website is a digital card solution uniquely designed for users and customized to enhance their online shopping, buying and gifting experience. The Social Smart Card will offer a wide selection of options to be used at the website’s certified retail partners. It has a simple-to-use interface, which connects to users’ social profile on Sagoon, and is a one-stop shop for all digital gifting needs. Similarly, the Me page personalizes all the content, tailor-made to fit the users taste in an exclusive and accessible way. The page is also a professional overview of users’ achievements and a personal impression of their social life. It also allows users to check their mails in networks like Yahoo and Gmail, which frees the users from having to logging in to these accounts separately. 
An investment of Rs 50 million has been made in the website till date, and there are 116,000 users at present. The company has informed that it will also launch the mobile version of the website in the near future. Actress Manisha Koirala is the brand ambassador of the social network site.

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