Don't Fear the Derivatives
Apropos the article on Credit Derivatives (Nubiz Management Oct. 08) by Sujit Mundul, let me add a few observations.
As the current global financial turmoil is blamed on the financial instruments called Derivatives, it may deter the Nepali officials from going ahead with their stated plan of starting derivatives market in Nepal Stock Exchange.
But they have to keep in mind that the US crisis was not caused simply by derivatives but by the overspeculation on the back of this fantastic financial instrument. The US regulators had failed to sufficiently regulate the market on this instrument.
Therefore, Nepali officials should go ahead with the introduction of derivatives in Nepali market though they should also learn from the US experience to avoid the possible negative developments in this market.
Remember that it is only an instrument and its benefits will depend on how you use it.
- Manoj Pia
Narayangarh
On Floods &
Economics
Apropos your cover story (Nubiz Sept. 2008), let me add that are caused by human errors, either in the design and construction of river control infrastructure or in developing settlements.
Dr. Ghosh's suggestion to introduce an insurance system for relief to the people to be affected by such natural disasters is very timely. Delaying this will be perpetuation of a crime against the humanity.
- Mridul Shah
Rajbiraj
Restructuring of Fulbari Loan
It is good news that the new management in Nepal bank Ltd. was successful to recover some amount in the last fiscal year from Fulbari Hotel and Spa.
But at the same time there are doubts whether the company will actually honour its future obligations fixed under the rescheduling agreement.
In the context of the fact that this company was the most recalcitrant among all the NBL clients, it would be appreciated if NBL regularly informs the public as and when it makes the payment to the bank.
- Kaushal Gurung
Pokhara
Maoist Budget
Madhukar SJB Rana has very succinctly exposed the farce behind the so-called revolutionary budget of the government led by the Maoists.
This budget is completely against the concept of encouraging private sector entrepreneurship. It is clearly for establishing a system of crony capitalism, licence and permit raj and controlling the trade and commerce in the county by the Maoist party.
Though the budget's objective to achieve mass literacy is quite laudable, there is a fear that this literacy campaign may end up brainwashing campaign to convert the gullible Nepalis into Maoist cadres.
- Rupak Jangam
Bhaktapur
Sunsari-Morang is only an example
Thanks for reporting about the plight of the industries along the Sunsari-Morang Corridor in your September 2008 issue.
But the plight of the industries in this corridor is not unique. Similar is the experience of the industrial units everywhere across the country. Lack of power, difficulty to move good to the markets due to bandhas and unmaintained roads and unreasonable labour strikes are problems common to the industries everywhere.
- Suranjan Agrawal
Bhairahawa
