Kathmandu (Pahichan) January 9 -The new industrial enterprises act should be oriented toward facilitating and promoting investments rather than regulating and controlling enterprises, stakeholders have said.

Speaking at a roundtable discussion on ‘Industrial Enterprises Bill (Draft)’ jointly organized by Society of Economic Journalists-Nepal (SEJON, Economic Policy Incubator and UKaid on Wednesday, economists, business leaders and former bureaucrats suggested that new industrial enterprises act should provide incentives to the enterprises in Nepal to help increase the industrial contribution in the gross domestic product.

Their call for provisions facilitating the industrial investments comes in the wake of the preparation of the Ministry of Industry, Commerce and Supplies to give a final touch to the new Industrial Enterprises Bill that will replace the existing the Industrial Enterprises Act that was enacted in 2016.

“The draft bill has proposed stricter provisions for fine and punishment even for committing a minor offence,” said Shekhar Golchha, senior vice president of Federation of Nepalese Chambers of Commerce and Industry (FNCCI), adding that the fine and punishment should be revised.

He also said that the provision related to corporate social responsibility and classification of industries, among others, should be revisited for the promotion of industrial sector in the country.

 Hari Bhakta Sharma, president of Confederation of Nepalese Industries, said that the law should be the most liberal law in the South Asia region to attract investment in the country.

“If we see other countries, including states of our neighboring country India, they are moving aggressively toward providing incentives to their industries. If our law does not take into consideration those developments, we cannot promote investment in industrial sector,” said Sharma.

He urged the government to change the provision that put restriction on selling the land bought by industrialist for setting up industry. He also said that it will be very onerous for industries, mostly small and medium level industries, to share their data with the Department of Industries in every six months as stated in the draft bill of the act.

Spending in the corporate social responsibility should be allowed for deduction for tax purpose, he said.

Dr Shankar Sharma, former vice chairperson of the National Planning Commission, underlined the need of strong coordination between various government agencies for the effective implementation of the act. “There are several good provisions in the draft bill despite some weaknesses. But, the key to the effective implementation is the strong coordination between government agencies,” added Sharma, who is also the team leader of EPI.

Yam Kumari Khatiwada, the secretary at the Ministry of Industry, Commerce and Supplies, said that the new draft bill focuses on further simplifying the process of entry, operation and exit of industrial enterprise in the country.