Share market on rise as govt positive to investor demand
The Nepal Stock Exchange (Nepse) has been witnessing substantial gains in the past few days as the government has hinted towards meeting the demands put forward by share investors for the development and expansion of the country’s sole secondary bourse.
Share investors have been staging protests at Nepse since December 9 to put pressure on the government to fulfil their demands.
“The government has assured us that it will do the needful to meet our demands to develop the secondary market,” said
Ambika Prasad Poudel, chairman of Nepal Investors’ Forum.
Earlier, the government and pressure groups formed by the share investors had held a meeting at the Ministry of
Finance on Friday where the government decided to address the demands raised by investors to increase margin landing. The government has also agreed to implement margin trading through brokers.
“After various stages of discussions with the government, it has agreed to raise margin lending as sought by investors,” informed Poudel.
Moreover, the government has also agreed to provide sharebroker licence to domestic commercial banks and also to new brokers across the country.
According to Poudel, it has also been agreed upon whereby the Securities Board of Nepal (SEBON) — share and commodities market regular — will introduce necessary provisions so as to allow non-resident Nepalis and other Nepali citizens living abroad to participate in the domestic securities market.
The Ministry of Finance had formed a committee under the chairmanship of Shivaraj Shrestha, deputy governor of Nepal Rastra Bank, and comprising share investors on Tuesday to identify the problems in the secondary market and provide necessary suggestions. The committee submitted its report to the government today.
Due to the continuous decline in the share market, share investors had also sought the resignation of Finance Minister Yubaraj Khatiwada and had submitted a 10-point demand to the government on December 9.
Various investor organisations like Nepal Investors’ Forum and Investors Association of Nepal, among others have voiced their support for the demands.
According to Poudel, the government has also been receptive to the idea of establishing market makers and dealership, which has been in the pipeline since the past three years. With regards to this the Citizen Investment Trust today said that it will establish a stock dealership worth Rs 10 billion to facilitate margin lending.
Meanwhile, as the government has been showing signs of meeting the demands raised by the investors, the Nepse index today increased by 1.64 per cent or 18.89 points to land at 1,167.67 points.
However, share investors have stated that they will not end their protest programmes unless the government meets their genuine demands in writing.
Source: The Himalayan Times