KATHMANDU, April 10: The commercial banks in the country have agreed not to open the letter of credit (LC) for the import of non-essential goods, in line with the instruction issued by Nepal Rastra Bank (NRB) last week.
A meeting of Nepal Bankers’ Association, the umbrella organization of commercial banks, on Sunday, decided to implement the instructions of the central bank. With the provision in effect, banks will not be opening LCs to import private vehicles, cigarettes and alcohol, dry fruits, furniture, decorative items and cosmetic products, among others.
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Citing the depleting foreign currency reserves, NRB last week summoned CEOs and representatives of commercial banks and instructed them not to open LCs for the goods other than essential items.
The NRB records show that Nepal imported vehicles and spare parts worth Rs 70 billion in the first seven months of the current fiscal year. The country is left with foreign currency reserves sufficient to import goods and services for only 6.5 months.
