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Writ filed against provision aimed at easing credit crunch

2018-07-16

The Supreme Court (SC) has called Nepal Rastra Bank (NRB) and Swagat Nepal — a petitioner who has filed a writ against the central bank’s decision to allow banks and financial institutions (BFIs) to borrow money from Indian financial institutions in Indian currency — to present their respective arguments.

The full bench of Acting Chief Justice Deepak Raj Joshi and Justices Om Prakash Mishra, Cholendra Sumsher JBR, Deepak Kumar Karki and Kedar Prasad Chalise today summoned both parties on July 27 for their comments on the given issue.

The central bank, through the Monetary Policy for 2018-19, has allowed BFIs to bring in loans from Indian BFIs in Indian currency in a bid to ease the credit crunch situation plaguing the market.

However, Swagat Nepal had filed a writ at the apex court on Thursday against the very provision of the Monetary Policy citing that allowing BFIs to bring in loans in Indian currency is against the country’s monetary sovereignty. “NRB’s decision is also contrary to different policies of the government that aims at increasing the use of local currency,” Nepal, who is a lawyer by profession, told The Himalayan Times.

Source: The Himalayan Times