NRB autonomy concerns as Finance Committee retains government’s power to issue directives
Summary
The House of Representatives’ Finance Committee has endorsed amendments to the Nepal Rastra Bank Act while keeping the government’s power to issue directives to the central bank on monetary, banking and financial matters. Former governors have warned that the move could undermine NRB’s autonomy, even as the bill also revises the governor’s term, eligibility rules and regulatory scope.
Key Points
- The Finance Committee unanimously endorsed a report on the bill to amend the Nepal Rastra Bank Act, retaining the government’s authority to issue directives to NRB.
- Former governors Maha Prasad Adhikari and Dr Tilak Rawal said the provision could weaken the central bank’s autonomy.
- The committee proposed shortening the governor’s term from five years to three years, with a possible two-year reappointment based on performance.
- The amendments would also expand NRB’s regulatory reach to cover the Citizen Investment Trust, Employees Provident Fund and Social Security Fund.
