In a bid to save foreign exchange reserves, the government has further extended ban on the import of vehicles except for the import of electric vehicles.
The ban has impacted many motor dealers across the nation with many having to completely shut down their auto showrooms. According to the NADA Automobiles Association of Nepal, this has added to the financial problems of businesspeople and the increasing interest rates on loans by financial institutions have worsened the problem.
Last fiscal year, 2021/22, banks and financial institutions invested around Rs. 95 billion in motor dealers. In the latest data provided by the NADA, at least 58 motor dealers have closed their doors as a result of the ban. Likewise, 100 others are on the verge of closure. This has also resulted in the loss of 1000 jobs across the nation, according to NADA.
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.
According to the NADA, 1025 vehicle dealers are still in operation across the country. NADA General Secretary Surendra Kumar Upreti said the government has extended the ban further putting this business in difficulty.
Upreti further said that all dealers based in the Kathmandu valley will close if the ban extends after mid-November.
“We have been frequently urging the government to remove the ban. We only got assurance from the government,” he shared.
He said that “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.”
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, jeeps, cars, vans, and motorcycles with a capacity of more than 150 cc till December.
