Kathmandu. Last week, the stock market plunged after some businessmen were detained for investigation, spreading panic among investors. However, policy clarity and positive messages after the formation of the new government indicate that the market will improve in the coming days.
Addressing the first meeting of the House of Representatives after the formation of the government, Rastriya Swatantra Party (RSS) Chairman Rabi Lamichhane has claimed that Nepal would now become a safe destination for investment. He urged the domestic and foreign investors to invest confidently as it was formed under the leadership of RSP. He pledged to ensure political stability, legal security and transparent administration. These things are expected to boost investor confidence.
Meanwhile, there are indications that action has been taken against high-level influential people and corruption control has been tightened. According to analysts, such steps will send a message of strengthening good governance and move the economic environment in a positive direction.
On the other hand, there are indications that Nepal may soon be out of the gray list of the Financial Action Task Force (FATF). Former Finance Minister Rameshwor Khanal has also hinted at such a possibility through social media.
If Nepal is removed from the grey list, it is believed that Nepal’s financial image at the international level will improve and attract more foreign investment.
According to market analysts, such messages on policy clarity, good governance and investment safety have gradually reduced the confusion seen in the capital market and increased the possibility of new investment coming in. In particular, the psychological pressure seen in NEPSE in recent times is likely to ease and the market may be heading towards correction.
Overall, the recent policy commitments, tightening of corruption control and signs of increasing international credibility have created a positive environment in Nepal’s stock market and the basis for restoring investor confidence seems to be strengthened.
