KATHMANDU, Nov 10: The government has banned the import of vehicles in a bid to save foreign exchange reserves. However, the import of electric vehicles is allowed. The import of light vehicles like cars, vans and jeeps for personal use has been banned.
But, the ban has resulted in the shutting down of many motor dealers across the country, adding financial burdens to businesspersons, according to the NADA Automobiles Association of Nepal. Similarly, increasing interest rates on loans by banks and financial institutions have also added to their problems.
In the previous fiscal year, 2021\22, banks and financial institutions invested approximately Rs 95 billion in motor dealers. According to the latest data with NADA, as a result of the ban, at least 58 motor dealers across the country have shut down.
Likewise, 100 others are on the verge of closure. The closed motor dealers include nine in Province 1, 11 in Madhes Province, 18 in Bagmati Province, seven in Gandaki Province, three in Lumbini Province, seven in Karnali Province and three in Sudurpaschim Province.
Motor vehicle imports fall after rise in interest rates on loan...
A total of 1,025 vehicle dealers are in operation across the country, said the NADA. Out of them, 145 are in Province 1, 95 in Madhes Province, 378 in Bagmati Province, 182 in Gandaki Province, 105 in Lumbini Province, 62 in Karnali Province and 58 in Sudurpaschim Province.
NADA General-Secretary Surendra Kumar Upreti said the government has extended the ban further putting this business in difficulty.
"We have been frequently urging the government to remove the ban. We only got assurance from the government," he shared.
Upreti further said all dealers based in the Kathmandu Valley would be closed if the ban continues even after mid-November.
"We have been running our offices and providing salaries to our staff by taking loans from banks as the business is considerably down. Motor dealers have been closed after they could not afford expenses. Dealers of heavy vehicles will be closed if such a situation persists," he mentioned.
With the closure of motor dealers, more than 1,000 staff across the country lost jobs, according to NADA.
Issuing a notice in the Nepal Gazette, the Ministry of Industry, Commerce and Supplies had on April 26 banned the imports of 10 different types of items citing depleting foreign exchange reserves in the country.
Although the ban on some of them has been lifted, the government has extended the ban on the import of smartphones priced over 300 USD, jeep, car, van and motorcycle with capacity of more than 150 cc till December.
