Finance Minister Rameshwar Khanal is moving ahead with restructuring Nepal Stock Exchange (NEPSE), following a report he himself prepared last year.
On Tuesday, the cabinet formed a five-member committee led by former Audit Board chairman Prakash Jung Thapa. The committee will oversee NEPSE’s institutional reform and strengthening. This move is seen as a push to speed up a process that has been delayed for years.
Supporters see growth, critics see bias
The government says NEPSE’s restructuring will help develop the capital market. Critics argue that some business groups are trying to make the finance minister the key decision-maker for NEPSE, raising concerns about favoritism.
The committee will include representatives from NEPSE, the Securities Board, Nepal Rastra Bank, and the finance ministry. The committee has 50 days to submit a detailed action plan.
Focus areas
The committee is expected to work on:
- Increasing NEPSE’s paid-up capital from 1 billion to at least 3 billion
- Issuing at least 30% of shares to the general public
- Bringing in strategic partners
- Strengthening institutional governance
Controversy Over IPOs
Previously, there was discussion about creating a second stock exchange in Nepal. Khanal’s report, however, focused on restructuring the existing NEPSE instead. Critics say some business groups influenced the report to favor existing players.
Although Khanal promised to follow his own report, he has been slow to implement recommendations that might limit certain groups’ influence. He has also pressured the Securities Board to allow financially weak companies to issue IPOs, despite warnings that this could harm the market.
This dual approach speeding up changes that favor some, while delaying others has led to debates about his true intentions.
