Parliamentary Committee Passes Bill Weakening Nepal Rastra Bank Autonomy
Summary
A parliamentary committee has passed a bill that critics say weakens Nepal Rastra Bank’s autonomy by cutting the governor’s term from five years to three, with a possible two-year extension at the government’s discretion. Former finance minister Yubaraj Khatiwada and former governor Chiranjibi Nepal warned that the move could politicize the central bank and threaten financial stability.
Key Points
- The Finance Committee of the House of Representatives passed the Nepal Rastra Bank (Third Amendment) Bill, 2083, reducing the governor, deputy governor and directors’ tenure to three years with a possible two-year extension.
- Former Finance Minister and former Governor Dr. Yubaraj Khatiwada and former Governor Dr. Chiranjibi Nepal strongly criticized the bill, saying it undermines central bank autonomy and could turn the institution into a government puppet.
- Some MPs, including Dr. Pushparaj Kandel and Parshuram Tamang, registered written dissent against the provision on shortening the governor’s term.
- The bill also adds new appointment, conflict-of-interest, and supervisory provisions, and will next go to the House of Representatives and then the National Assembly.
