Kathmandu. The Insurance Board has instructed all insurance companies not to buy any new vehicles at this time as much as possible. The regulatory authority has also directed all the insurers not to buy any expensive vehicles. Such instruction has been issued over the low foreign currency reserve with the Central Bank, Nepal Rastra Bank.
Rajuraman Poudel, executive director of the IB, said that the instruction has been issued amid foreign exchange reserves are declining and the balance of payments deficit is increasing. He said that NRB is taking various steps to discourage increasing imports. We have also asked the insurance companies not to buy new vehicles except for the essential ones.’
Till last year, an insurer was obliged to get pre consent from the IB before purchasing any four wheeler. But such provision was revoked by the IB and delegated the authority to the Board of Directors of Insurers for such purchase decision.
As the price of fuel skyrockets in the world market, Nepal’s foreign exchange reserves are gradually declining. NRB has proposed two days off a week to control fuel consumption, indicating that Nepal may not be able to procure even the most basic necessities if we continue to do so.