FOREST FIRE DESTROYS COVER IN NORTH LAMJUNG

SUPREME COURT JUDGES DISCUSS CONSTITUTIONAL COURT

Kathmandu, 16 March: Chief Justice Ram Prasad Shrestha and six apex court justices Wednesday discussed with an empowered sub-committee under a main constitution drafting committee a decision to establish a constitutional court at the center with final judicial review power t in a new judicial structure.
Coordinator of the sub-committee Maoist Chairman Prachanda was present.
Two courts- supreme court and constitutional court—have been mooted at the center.
Chief Justise Shrestha opposed the sub-committee decision saying democracy will be weakened and a rift will be created between the proposed two courts.
Shrestha said constitutional courts have failed in countries like South Africa and Russia and such courts don’t exist in South Asia.
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FOREST FIRE CONTNUES UNABATED IN NORTH LAMJUNG

Kathmandu, 16 March: Hundreds of ropanis of forests have been destroyed by a fir that continued unabated for the sixth day Thursday in north Lamjung.
The fire has hindered the movement of hundreds of foreign trekkers and locals in a Annapurna Conservation area.
Wild animals and birds have been killed and flora destroyed, locals said.
The dry spell is the time for fires and storms in the hills and terai.
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KATHMANDU/ TERAI ROAD PROJECT MAY BE DELAYED





Kathmandu, March 16 - The most awaited ‘Kathmandu-Terai Fast Track’ project is likely to face new complexities and consume more time in finalizing the Expression of Interest (EOI) following the latest directions of the Public Accounts Committee (PAC) under the Legislative Parliament, C.K. Lal reports in The Rising Nepal.
The PAC directed the government to assure at least 10 per cent local investment in works or cost in the construction of the fast track.
Similarly, the PAC instructed the project to extend time to submit the EOI and remove its terms of conditions to insure the involvement of Nepalese investors.
Saroj Man Shrestha, project manager of the Fast Track Project, informed that the project needed a new document of EOI to include the directions of the Public Accounts Committee (PAC).
"The directions of PAC could not be included in the old document of EOI only by making corrections," he said.
If the terms and conditions were removed as per the decision of PAC, Nepalese investors without experiences in Build, Operate and Transfer (BOT) system and having no construction experiences could get involved in the construction process.
The project has already sent the document to the Ministry of Physical Planning and Works including additional provisions as per the instruction of the PAC for its approval, he informed.
Talking to The Rising Nepal, Shrestha said that those companies that had submitted their EOI earlier as per the demand of the project could withdraw from the process due to the complex situations created by the new provisions.
Two Indian companies, Reliance India and L& T Infrastructure Development and one Korean-LMW- had submitted their EOI so far for the construction of the fast track road.
The possible bargaining of Nepalese investors, interested to take part in the construction process with foreign companies, could cause problems in EOI of the foreign companies, he suspected.
The 76 km long fast track joining Kathmandu to eastern Terai is the first project exercised to construct through Public Private Partnership (PPP) on Build, Operate and Transfer (BOT) model.
According to Shrestha, six companies which submit their EOI would be short listed as per their profile. One proposal from the short listed companies would be selected for the construction of the project, he said.
If the process of EOI and other goes smoothly, it will take more than one and a half years to give license to the construction company, he said.

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STUDENTS RETURN FROM CHINA WTHWASTED YEAR

Kathmandu, 17 March: When they landed in Xinhua City of China on December 27, 2010 to enrol at the staff nurse programme at the Xinhua Private College, 10 Nepali girls had no inkling of the troubles that lay ahead, Uday GM reports in The Himalayan Times from Dang.

Over a year later, with a year gone waste, the girls returned home yesterday to narrate the troubles they went through.

According to Pratiksha GM of Ghorahi, Dang, Little Doctors’ Programme had sent seven girls from Dang, one from Butwal, Rupandehi district, and one from another district to the Chinese private college with a prnomise to enrol them at the programme for Rs 2.5 lakh under scholarship.

“We suffered much. So much so, we were even forced to spend days without food,” she recalled, adding that the college denied them admission because the agents had not paid it the required sum.

The girls said they were even asked to pay for accommodation and food in the college. They had to face much hardships as there was no girls’ hostel.

“We were told there are separate hostels for girls and boys, but there was just one hostel for both the boys and the girls,” the victims lamented. We were sent there with a month’s tourist visa instead of a three-year student visa, the according to the girls. After much trouble, Nepali Embassy in China came to the girls’ rescue. “Though the college admits students, who have passed higher secondary level and are above 19 years, even 16-year-olds, who had just passed SLC, were sent with us.”

Acting on guardians’ complaints, police held LDP chief Kalpana Sharma and director Hum Bahadur Bohara in February. Despite the plaints, police have not arrested LDP’s Dang coordinator Dirgha Narayan Pande and principal of Little Angels’ Boarding School in Dang, Yadav Giri. Pande and Giri have accused Sharma and Bohara of cheating them.
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FNCCI OPPOSES MIXED ECONOMY PROPOSAL
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Kathmandu, 17 March: It was meant to strengthen, professionalise and prepare the domestic banking sector for future challenges, but the proposed amendment to the proposed Banks and Financial Institution Act (BAFIA), which seeks to replace the term ‘economic liberalisation’, Mukul Humagain and Prithvi Man Shrestha write in The Kathmandu Post.

with ‘self-reliant mixed economy’, has caused jitters among the private sector.

The fact that Maoist lawmakers made this amendment proposal has made the private sector wary. Such is their apprehension that the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) on Wednesday issued a strongly-worded press statement.

The FNCCI in the statement expressed serious concern about the proposed amendments that sought to adopt a mixed economic system and limit promoters’ shares in banks and financial institutions at five percent.

“The federation has termed this attempt to abandon the liberal economy adopted by the democratic political system by adopting the controlled economic system that has already failed as unfortunate,” reads the FNCCI statement.

The private sector, over the last three-four years, has felt that they are being cornered by the state and the political parties. According to the private sector, the increasingly militant trade unionism, rising donation terror, deteriorating business environment and state’s inability to resolve the power crisis have made running business unviable and kept possible investments away.

“More uncertainties will arise if promoters of banks and financial institutions that have come into operation with existing rules and regulations are forced to offload their promoters’ shares,” reads the statement.

FNCCI President Kush Kumar Joshi said the private sector invested in banking sector due to worsening business climate in other sectors. “Discouraging the private sector from investing in the banking sector may lead to capital flight,” he said.

The private sector had a similar apprehension when a high-level task force headed by UCPN (Maoist) Chairman Puspa Kamal Dahal had agreed that the new constitution would adopt a three-pillar economic model — public, private and cooperatives. The private sector was also annoyed by the parties’ reluctance to accept the public-private partnership concept. Instead, they had agreed to state public-private participation.

A meeting of the FNCCI executive committee on Dec. 7, 2010 had said that the private sector would not endorse the new constitution if it does not ensure open and free economic policy.

The private sector still has concerns over the Maoists’ commitment to property rights, rights to do business and overall free market economy. They fear of the state intervention or control over sectors like education, health, financial services and infrastructure.

“The Nepali economy is in crisis with low economic growth, rising trade deficit and capital flight. The provisions being mulled at this point of time will demolish the economy,” said the FNCCI. “We want to draw the attention of policymakers that it will ruin the investment environment.” The FNCCI is scheduled to meet Deputy Prime Minister and Finance Minister Bharat Mohan Adhikari on Thursday on what type of economic policy the country is going to adopt.

Key proponents of the liberal economy also have strong reservations over the proposed amendments to the BAFIA. Former Finance Minister Ram Sharan Mahat said a reversal in free and liberal economic model would be counter-productive for the economy and the country. “It will discourage the private investment and entrepreneurship,” said Mahat.

The former minister said the liberal economic policy being adopted currently has not ignored the spirit of the mixed economy completely. He said a diversion from the liberal policy would destroy achievements made so far in the banking sector.

Bankers on Monday had expressed strong reservations over the proposed amendments to liberal economic model. They met Deputy Prime Minister Adhikari on Wednesday and sought clarification on whether the country would adopt a mixed economic model. “Given that the country is yet to draft the new constitution, how can the government formulate laws based on the mixed economic model,” asked Ashoke Rana, president of the Nepal Bankers’ Association.

Bankers also met leaders of Nepali Congress, UPCN (Maoist) and CPN (UML) to express their displeasure over the amendment proposal.

However, Lawmaker Hari Roka, who had proposed the mixed economic model in the proposed BAFIA, expressed surprise about the hue and cry over the amendment proposal. He said the proposal was aimed at ensuring proper regulation of banks and financial institutions.

“As banks and financial institutions are basically public institutions, the NRB should regulate them properly to protect the interests of ordinary depositors,” he added.
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BOGUS VAT TRANSACTIONS TOPS RS. 10B

Kathmandu, 17 March 17: In startling revelations, the Inland Revenue Department (IRD) has traced 460 large and medium-scale firms involved in a fake VAT bill racket, making a mockery of the tax administration, Milan Mani Sharma writes in Republica.

Worse still, investigations are continuing to unveil one firm after another involved in the racket, indicating that the racket is much wider and deeper than officials suspected.

"It´s pretty shocking. But the volume of fake VAT transactions we have traced so far is already as high as Rs 10 billion (over US$ 138 million)," said a source. This is estimated to have caused the state revenue losses of well over Rs 4 billion.


The involvement of so many firms in the racket was traced when the department in December, 2010 scooped down on 32 major firms using fake VAT bills. They included not just small traders but even leading corporate houses.

The firms had either bought genuine VAT bills from smaller firms or printed the bills of some other registered traders to create fake transactions in order to evade tax and also claim VAT refund, thus siphoning money from the national treasury.

IRD reckons that the efforts of the department alone will not be enough to deal with the mess that was detected as long as four years ago. On Wednesday it handed over the 460 cases involving fake VAT bills to the Inland Revenue Offices (IRO) for further investigations.

"We have instructed the IROs to deal with the cases with high priority," said Revenue Secretary Krishna Hari Baskota. IROs have been asked to complete the investigations and recoup the leaked revenue with fines, by the end of this fiscal year.

To facilitate investigations, IRD has identified high revenue risk areas and developed strict monitoring tools to track the activities of firms dodging tax as well as IROs investigating the cases.

"The tools suggest the types of firms and sectors to be monitored and also guides them on how to carry out investigations," said the source.

The department has instructed the offices to cross-match all procurements by wrongdoing firms over the past four years, tracing out vendors, size of the firms, PAN and volume of revenue evaded.

An internal committee formed at IRD has developed a format and software to track vendors and make sure that VAT refund claims and expenses shown to deduct from income are genuine.

These steps were taken to expedite reforms within the tax administration. The department is also working out policy responses to plug loopholes. It plans to incorporate these in the next budget.

Tax evaders seek amnesty

After being traced out, entrepreneurs involved in the fake bills racket have continued to approach political parties and influential leaders, including Deputy Prime Minister and Finance Minister Bharat Mohan Adhikari, to withdraw action against them.

"They are mainly pushing for amnesty as they claim they cannot afford the fines slapped in the current industrial gloom," said a highly-placed source.

Their initial approach was to influence senior officials at the Ministry of Finance. However, after that failed, they promised IRD not to repeat such mistakes. They also sought non-disclosure of their names to the public.

"They even brought to our notice a clause in the Income Tax Act guaranteeing taxpayers´ rights," said the source. Under the Act tax official concerned could face up to two years in jail.

The tax evaders have since stopped dealing with the bureaucracy. "But we are dead sure the wrongdoers are not keeping still," said an official.
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